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VMworld

Ajit Deshpande - - 0 Comments

Last week, VMware hosted its annual conference, VMworld, over three days between August 27th and August 29th. Coming just a few weeks after the company’s acquisition of software defined networking pioneer Nicira (as well as of Opus portfolio company Wanova), this year’s VMworld was all about driving home VMware’s strategic vision of becoming an end-to-end virtualization solutions provider for the datacenter. To that end, a couple of key integrated virtualization solution stacks were announced by the company. The first one was vCloud 5.1, an integrated bundle consisting of server, network and storage virtualization products, as well as management and extensibility offerings. The second one was Horizon Suite which is a solution for centralized management of files, data and privileges across multiple devices and platforms in the enterprise (with Wanova Mirage technologybeing a key component of this suite).

As we move towards a virtualized world with optimally shared IT resources, a couple of interesting virtualization-related trends seem to be gaining steam. First, innovation on the hardware side might be becoming less lucrative, driven down by lower exit multiples in the face of capital efficient software defined solutions. Second, even for software plays, significant sales and platform barriers from VMware’s integrated suite (and potentially very soon from Microsoft as well, since they will be expected to build out their own solution stack) imply that future M&A exits in virtualization might actually be for application / feature plays that broaden out the virtualization suite as opposed to creating new markets. A VMworld where the major announcements are about vertical integration as opposed to cool new technologies may be a sign that the industry is maturing, and so early stage startups will probably need to be extremely strategic and farsighted as they scale up and grow.

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