Dangerous: VMware underestimates OpenStack

August 19, 2013 |

Slowly we should seriously be worried who dictated VMware executives, what they have to say. In early March this year, COO Carl Eschenbach says, that he finds it really hard to believe that VMware and their partners cannot collectively beat a company that sells books (Note: Amazon). Well, the current reality looks different. Then in late March, a VMware employee from Germany comes to the conclusion, that VMware is the technology enabler of the cloud, and he currently see no other. That this is far from it, we all know, too. Lastly, CEO Pat Gelsinger puts another one on top and claims that OpenStack is not for the enterprise. Time for an enlightenment.

Grit your teeth and get to it!

In an interview with Network World, VMware CEO Pat Gelsinger spoke on OpenStack and does not expect that the open source project will have a significant reach in enterprise environments. Instead, he considered it as a framework service providers can use to build public clouds. In contrast, VMware has a very wide spread with extremely large VMware environment. The cost of switching and other topics are therefore not particularly effective. However, Gelsinger sees for cloud and service providers, in areas where VMware has not successfully done business in the past, a lot of potential for OpenStack.

Furthermore, Gelsinger considered OpenStack as a strategic initiative for VMware, which they are happy to support. VMware will ensure that its products and services work within cloud environments based on the open source solution. In this context OpenStack also opens new opportunities for VMware to enter the market for service providers, an area that VMware has neglected in the past. Therefore, VMware and Gelsinger see OpenStack as a way to line up wider.

Pride comes before a fall

Pat Gelsinger is right when he says that OpenStack is designed for service providers. VMware also remains to the leading virtualization vendors in the enterprise environment. However, this type of stereotypical thinking is dangerous for VMware. Because the tide can turn very quickly. Although Gelsinger like to see the high switching costs as a reason why companies should continue to rely on VMware. However, there is one thing to consider. VMware has its strengthen only(!) in virtualization – with the hypervisor. In relation to cloud computing, where OpenStack has its center of gravity, it does not look as rosy as it might look. To be honest, VMware has missed the trend to offer early solutions that make it possible to enable the virtualized infrastructure for the cloud, and serve with higher quality services and self-service capabilities to allow the IT department to become a service broker. Meanwhile, solutions are available, but the competition, not only from the open source environment, grows steadily.

This is also seen by IT buyers and decision makers. I’ve spoken with more than one IT manager who plans to exchange its VMware infrastructure against something open, in most cases KVM was named, and more cost-effective. This is just the virtualization layer which can break away. Furthermore, there are already some use cases of large companies (see on-premise private cloud) that use OpenStack to build a private cloud infrastructure. What also must not be forgotten is that more and more companies change in the direction of a hosted hosted private cloud or public cloud provider and the own data center will become less important over time. In this context, the hybrid cloud plays an increasingly important role to make the transfer and migration of data and systems more convenient. This is where OpenStack due to its wide distribution in hosted private cloud and public cloud environments has a great advantage over VMware.

With such statements, of course, VMware tries to suppress OpenStack from their own territory – on-premise enterprise customers – to place their own solutions. Nevertheless, VMware should not make the mistake of underestimating OpenStack.

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About the Author ()

Rene Buest is Senior Analyst and Cloud Practice Lead at Crisp Research, covering cloud computing and IT infrastructure. He is member of the worldwide Gigaom Research Analyst Network, top cloud computing blogger in Germany and one of the worldwide top 50 bloggers in this area. In addition, he is one of the world’s top cloud computing influencers and belongs to the top 100 cloud computing experts on Twitter. For more than 16 years he is focused on the strategic use of information technology in businesses and the IT impact on our society as well as disruptive technologies. Rene Buest is the author of numerous professional cloud computing and technology articles, speaker and participant of experts rounds. On CloudUser.de he writes about topics from the fields of cloud computing, it-infrastructures, technologies, management and strategies. He holds a diploma in computer engineering from the Hochschule Bremen (Dipl.-Informatiker (FH)) as well as a M.Sc. in IT-Management and Information Systems from the FHDW Paderborn.

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