VMware’s all-in-one line boosts push into data centre market

VMware is boosting its push into the $440bn (€333bn) data centre market long dominated by the likes of Microsoft, Cisco Systems, and IBM. 

The California-based company, is unveiling a new line of all-in-one products and related partnerships, aiming to become a bigger player.

The initiatives announced at the VMworld conference in San Francisco, position VMware as a provider of cloud-computing software for running all the hardware — servers, data networks, and storage — needed to operate data centres.

If successful, the strategy would move VMware further away from parent EMC, which owns 80% of VMware and is the world’s biggest provider of storage computers. That could bolster the case made by Elliott Management — which last month said it amassed an active stake of more than $1bn in EMC — that VMware should be spun off.

At stake is a piece of the data- centre industry, which Gartner projects will climb 11% to $488bn in 2015. VMware’s main virtualisation market, where it is the biggest developer of software used to make server systems run more efficiently, is much smaller, with revenue predicted to climb to $7.42bn in 2018 from $4.37bn this year, according to researcher IDC.

Jeremy Burton, president of products and marketing at EMC, said that any threat to the company’s storage business is overblown.

“The idea that because VMware builds out a little bit of functionality will have a massive negative impact on EMC’s storage business is just speculation at best,” he said.

“And at the end of the day, VMware is part of EMC, so all of their revenue goes to us.”

About 75% of VMware’s sales are from virtualisation software, according to Noland. Revenues at the company are projected to grow 16% to $6.03bn this year.

“VMware and EMC share a common vision for software-defined storage,” Raghu Raghuram, VMware’s executive vice president of Cloud Infrastructure and Management, said.

“VMware is working with EMC to provide customers with choice and complete end-to-end solutions.”

EMC, Dell, Fujitsu. and other hardware makers will partner with VMware for the all-in-one data-centre software, which is called EVO: RAIL.

While EMC would benefit from sales of the product, VMware’s broader strategy is aimed at letting other companies reduce the total amount of storage they need.