We are not as fast as we need to be: VMware CEO

  • Size doesn’t matter as much anymore, it’s about speed
  • Sees strong traction in various emerging products and services
We are not as fast as we need to be: VMware CEO

CLOUD giant and virtualisation pioneer VMware Inc has been very active in the past year: It introduced a new hybrid cloud strategy, unveiled new products, upgraded existing solutions, formed partnerships, and more.
 
The new hybrid strategy, dubbed ‘One Cloud, Any App, Any Device,’ was unveiled earlier this year. It also announced a partnership with Google Inc, in which VMware would enable its vCloud Air public cloud service to work with the latter’s public cloud platform.
 
Just in the past week or so, VMware introduced a new version of its VMware NSX solution (Version 6.2), and unveiled vSphere Integrated Containers, the VMware Photon Platform, and VMware Evo SDDC.
 
Yet despite this frenzy, VMware chief executive officer Pat Gelsinger (pic above) wants more.
 
“Is VMware a slow company? No, I don’t think so. Do I think of us as being fast as we need to be? No, I don’t,” he said.
 
“Part of my job ... is to build more urgency into our activities. I think we need to go faster with that,” he told a media briefing after his keynote address at the company’s VMworld 2015 conference in San Francisco on Sept 1.
 
“Nevertheless, I feel like we are making progress in areas. We are moving more of our products to be ‘delivered products.’ I do feel good about increasing the heart rate of our products.
 
“But how we shift our go-to-market capabilities must also be faster in the face of these changes,” he added.
 
During his keynote address at the Moscone Centre, Gelsinger reminded the over 20,000 participants that in the world today, the benefits of being an incumbent are declining and that size does not matter as much as it used to – instead, speed matters.
 
“… mobile gives access, the Internet gives reach, and the cloud gives scale. It does change the competitive dynamics. It affects everybody in all industries, including VMware.
 
“We need to embrace and take advantage of those things as well,” he added.
 
Strong traction

We are not as fast as we need to be: VMware CEO

During the first half ended June 30, 2015, VMware’s revenue rose 8% to US$3.03 billion, while net profit increased marginally to US$368 million against US$366 million in the first half of last year.
 
The increase was partly driven by its services business, which grew 15% to hit US$1.89 billion in revenue.
 
The product and customer base story is just as strong. Take its network virtualisation product VMware NSX for example –in the first half of last year, it had a mere 150 customers; a year later, it has over 700 paying customers.
 
VMware now has over 2,000 virtual SAN (storage area network) customers, up from 1,000 early this year.
 
During the first half of 2015, its hybrid cloud – which includes its vCloud Air and vCloud Air Network – and Software-as-a-Service (SaaS) business contributed to over 6% of total revenue. It is aiming for that number to grow to more than 10% over the next few years.
 
VMware breaks down its revenue into two portions: Licences and services. Its licence revenue partly comes from its emerging product offerings, including AirWatch mobile solutions, as well as revenue from its vCloud Air, vCloud Air Network and vSphere. Its services revenue is made up of software maintenance revenues.
 
However, interestingly, its SaaS revenue, including vCloud Air and AirWatch, are included in both licence and services revenue figures.
 
“If you look at the announcements we made this week, we have made a leapfrog step forward ... I believe that the momentum will continue,” Gelsinger said.
 
“Over the next few years, we are expecting our hybrid cloud and SaaS [revenue contribution] to cross the 10% mark. We are taking steps to make all of our products available on-subscription or as cloud-based services, going forward.
 
“We see it as a fundamental delivery vehicle shift on how we reach our customers,” he added.
 
Competition from Amazon and Microsoft

We are not as fast as we need to be: VMware CEO

At the heart of its future lies the cloud. Today, VMware offers a public cloud service via vCloud Air, with data centres in Australia, Japan, the United Kingdom and the United States.
 
It also has more than 4,000 partners which offer vCloud Air Network. Among the notable partners in South-East Asia include Malaysia’s Maxis Bhd and Singapore Telecommunications (Singtel).
 
At VMworld 2015, VMware demonstrated how organisations can seamlessly and securely move workloads from one data centre to another, from the public cloud to a private cloud, in just a few clicks and in less than a few hours [depending on the size of the workloads].
 
But there are predators nipping at its heel in the cloud.
 
“It’s not like VMware has had its head in the sand and believes that it is only one cloud or it’s only VMware,” said VMware president Carl Eschenbach (pic above).
 
“We recognise people leverage multiple clouds and SaaS offerings, and we want to be the purveyor of the automated workloads across all of them,” he said.
 
Meanwhile, Gelsinger told the media that he sees Microsoft Corp and Amazon Inc as key competitors.
 
“If I think about the top players, those I see as the long-term players in the cloud (space) include Amazon, Microsoft, Google, VMware and perhaps IBM.
 
“If you think about their strategies, Microsoft is actually the most similar to VMware, [offering] on-premises and off-premises, delivering a high grade experience,” he said.
 
But Google is a partner, and Gelsinger said he expects the two companies to cooperate and partner more as they move forward.
 
“We have announced our Object Service ... we have three more services that we commit to making available.
 
“I really expect the Google-VMware partnership to become more significant as we move towards the future,” he added.
 
Goh Thean Eu reports from VMworld 2015 in San Francisco at the invitation of VMware. All editorials are independent.
 
Related Stories:

VMware targets Microsoft and AWS with OneCloud

Hedging its bets, VMware embraces brave new IT world
 
Challenging transition ahead for VMware
 
VMware wants to get you out of ‘Hotel California’
 
 
For more technology news and the latest updates, follow us on TwitterLinkedIn or Like us on Facebook.

 
Keyword(s) :
 
Author Name :
 

By commenting below, you agree to abide by our ground rules.

Subscribe to SNAP
Download Digerati50 2018-2019 PDF

Digerati50 2018-2019

Get and download a digital copy of Digerati50 2018-2019