SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

   Technology StocksVMware, Inc. (VMW)


Previous 10 Next 10 
From: Glenn Petersen7/21/2016 4:36:38 PM
   of 345
 
VMware's Beat And Raise Ease Worries Over Management Changes

REINHARDT KRAUSE
IBD
7/19/2016

VMware
( VMW) stock jumped Tuesday as a beat-and-raise quarter eased worries over management changes, amid parent EMC's ( EMC) sale to privately held Dell.

EMC shareholders are meeting Tuesday to vote on Dell's $60 billion offer, and approval is expected.

VMware President Carl Eschenbach, CFO Jonathan Chadwick, and Martin Casado, a vice president, all recently left the company.

Late Monday, VMware reported Q2 earnings and sales that exceeded analysts' estimates, and it also raised its forecasts. VMware stock ended trading up 9.1% on the stock market today, at a nine-month high above 68.

"While it is logical to assume that all of the noise around VMW of late, including management departures and M&A-related concerns, will have a negative effect on the business, we believe that business is surprisingly resilient and that the company continues to sign deals," Jefferies analyst John DiFucci said in a research report.

VMware's virtualization software is widely used in corporate data centers. The software enables computer servers to run different operating systems and apps, increasing workloads and adding network flexibility. VMware aims to stay a leader in corporate computing as companies move to cloud-based technology -- sharing servers and data storage in remote data centers.

"While some skeptics may believe Q2's double-digit growth drained the pipeline, management sounded notably positive around the foundation the team has built for the back half of the year, which includes a big renewal opportunity and increasing contribution from the emerging product portfolio," UBS analyst Brent Thill said in a research report.

VMware said Q2 revenue rose 11% to $1.69 billion, while earnings minus items rose 4% to 97 cents per share. Analysts had modeled EPS of 95 cents on revenue of $1.68 billion.

For the current quarter, VMware forecasts EPS ex items of $1.10 on sales of about $1.76 billion, vs. consensus estimates of $1.05 and $1.72 billion.

investors.com

Share RecommendKeepReplyMark as Last Read


From: JakeStraw9/1/2016 8:37:43 AM
1 Recommendation   of 345
 
New Tracking Stock Offers Cheap Play on VMware
barrons.com

The VMware tracker to be issued by Dell next week as part of its EMC acquisition offers significant upside.

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: JakeStraw who wrote (304)9/3/2016 9:43:06 AM
From: Glenn Petersen
   of 345
 
The full article for those stymied by the Barron's paywall:

New Tracking Stock Offers Cheap Play on VMware

The VMware tracker to be issued by Dell next week as part of its EMC acquisition offers significant upside.

By Andrew Bary Biography
Barron's
August 31, 2016



VMWare CEO Patrick Gelsinger speaking at the 2015 Mobile World Congress Photo: Simon Dawson/Bloomberg
_______________________

The newly created tracking stock for VMware that will be issued by Dell as part of its $58 billion deal to buy EMC looks like a cheap way for investors to play VMware.

Shares of the tracking stock, Dell Technologies Class V (ticker: DVMTV), have been trading in the when-issued market for about two weeks and now changes hands at $44.68, roughly a 39% discount to VMware’s ( VMW ) common shares, now fetching $73.33. VMware is a software company best known for its virtualization products.

The VMware tracked shares are being issued to EMC holders as part of Dell’s cash-and-stock acquisition of EMC. Dell announced yesterday that the deal received Chinese regulatory approval, the last hurdle to the transaction, and will close on Wed. Sept. 7. The ticker on the tracker will change to DVMT after the deal closes. EMC holders will receive $24.05 in cash and 0.111 shares of the VMware tracker for each EMC share. EMC shares are fetching $28.99 today, unchanged on the day. Investors also can play the VMware tracker by purchasing EMC shares since they will get the tracker once the deal closes next week.

Dell offered the tracker as part of the consideration for the EMC deal in order to give EMC holders continued exposure to the company and reduce the cash outlay for the deal. EMC owns about 80% of VMware.

Tracking stocks, which are designed to reflect the economic performance of the underlying company, typically trade at some discount to the regular stock but the discount on the VMware tracker is unusually wide. Liberty Media’s tracking stock for SiriusXM Holding ( LSXMA) now trades at $33.51, an estimated 12% discount to Sirius stock (SIRI). Investors understandably prefer to directly own shares in a company rather than a tracker.




Barron’s wrote earlier this month that EMC was an attractive arbitrage situation because of the effective discount being applied to the VMware tracker. At that time, EMC traded at $28.20.

At a price of $44.68 on the tracker, investors effectively are purchasing VMware at just 10 times estimated 2016 earnings of about $4.30 a share, and that doesn’t reflect the company’s $16 a share in net cash.

Why such a steep discount on the tracker? The shares will be a class of Dell common stock and thus be exposed to the credit risk of Dell, which will be highly leveraged following its purchase of EMC. If Dell fails, the tracker could be wiped out. While Dell will be a junk-grade company following the EMC deal with estimated debt to annual cash flow of about six, it will have a sizable amount of annual cash flow and plans to deleverage. Another issue is that investors are wary about Dell CEO Michael Dell’s intentions. While Dell is bullish on VMware, it conceivably could let VMware languish under its control to repurchase the tracker stock or VMware itself more cheaply down the road.

One sizable EMC holder says he sees several reasons why the tracker discount to VMware could narrow. For starters, it’s rumored that some big institutional investors may be ready to purchase the tracker as an alternative to VMware once the deal closes.

The tracker apparently is more liquid than VMware and likely will get even more so once the deal closes. There will be about 223 million shares of the tracker outstanding, more than double the roughly 80 million shares of VMware. Dell will hold the remaining VMware stock, a roughly 28% stake. The higher liquidity in the tracker could narrow the discount.

While Dell is expected to focus initially on paying down debt, it could be a buyer of the tracking stock and indeed has stated publicly that it “may look for opportunities to repurchase shares” of the tracker, or Class V common.

What’s the upside in the tracker? If the tracker discount narrows to 25%, the shares would trade around $55 — about 23% above the current price — assuming no change in VMware.

A spinoff of Dell’s VMware stake to tracker holders in a one-for-one share swap isn’t likely for five years because of adverse tax consequences, according to New York tax expert Robert Willens. Such a move would collapse the tracker/VMware spread. Even without that event, tracker investors still could score if the discount narrows.

barrons.com

Share RecommendKeepReplyMark as Last Read


From: Glenn Petersen10/13/2016 6:17:32 PM
   of 345
 
VMware’s new cloud service will run on AWS

by Frederic Lardinois ( @fredericl)
TechCrunch
October 13, 2016



It’s been an open secret that Amazon’s AWS division and VMware were going to announce a partnership at a press conference in San Francisco later today. Thanks to VMware mistakenly posting its announcement early, we didn’t have to wait for the afternoon to know what the two companies will announce.

In what is surely a play to get more enterprises to move to AWS over its competitors — and to protect VMware’s leadership around virtual machines, VMware and AWS are bringing VMware’s software-defined data center software to AWS under the ‘ VMware Cloud on AWS‘ moniker.



This means that all of VMware’s infrastructure software like vSphere, VSAN and NSX will soon run on AWS. The service is currently in its technology preview phase and an invite-only beta will start in early 2017 and the service will likely come out of beta in mid-2017.

The service will be operated, sold and supported by VMware (not AWS) but integrate with the rest of AWS’ cloud portfolio (think storage, database, analytics and more).

“Our customers continue to ask us to make it easier for them to run their existing data center investments alongside AWS,” wrote Andy Jassy, CEO, AWS, in today’s announcement. “Most enterprises are already virtualized using VMware, and now with VMware Cloud on AWS, for the first time, it will be easy for customers to operate a consistent and seamless hybrid IT environment using their existing VMware tools on AWS, and without having to purchase custom hardware, rewrite their applications, or modify their operating model.”

At their event today, the two companies introduced a number of early customers. These include Western Digital and Sysco.

The companies stress that this is a jointly architected service that “represents a significant investment in engineering, operations, support and sales resources from both companies.” It will run on a dedicated AWS infrastructure that was “purpose-built for this offering.” VMware CEO Pat Gelsinger also today stressed the fact that AWS and VMware worked very closely together to create this service and stressed that this will become VMware’ primary public cloud solution.



“Currently in Technology Preview, VMware Cloud on AWS, will bring VMware’s enterprise class Software-Defined Data Center software to the AWS cloud, and will enable customers to run any application across vSphere-based private, public and hybrid cloud environments,” VMware’s Mark Lohmeyer writes in today’s (currently deleted) announcement. “It will be operated, managed and sold by VMware as an on-demand, elastically scalable service and customers will be able to leverage AWS services such as developer tools, analytics, databases, and more.”



While Microsoft, IBM and others have strongly focused on the idea of the “hybrid cloud” (that is, a setup where an enterprise uses both its own data centers and public cloud services like Azure, Google Cloud or AWS), Amazon has mostly ignored this market.

Given that VMware already dominates in many of these enterprise’s own on-premises data centers but doesn’t own a public cloud service to give these users a hybrid option — and that AWS doesn’t offer an on-premises version of its services — it makes sense for these two companies to team up now.

VMware also stressed in its announcement the hybrid capabilities this partnership enables and notes that it will bring “full VM compatibility and total workload portability between the datacenter and the AWS cloud.”



It’s worth noting that AWS already offered some support for VMware’s vCenter for managing virtual machines. Thanks to this, vCenter admins have long been able to manage their AWS EC2 cloud computing instances using the same software they use for managing their VMware virtual machines. That service, too, made it relatively easy to move existing virtual machines to EC2.

As IBM kindly pointed out in a series of emails meant to preempt today’s announcement, VMware and IBM already teamed up and announced a partnership back in February. This deal with AWS seems to go quite a bit further, though.

techcrunch.com

Share RecommendKeepReplyMark as Last Read


From: Glenn Petersen10/27/2016 9:38:50 AM
   of 345
 
VMware Rising on Q3 Earnings Beat, Raises Full-Year View

By Tiernan Ray
Barron's
October 26, 2016, 4:56 P.M. ET

Shares of virtualization software pioneer VMware ( VMW) are up $1.44, or 2%, at $74.75, after the company this afternoon reported Q3 revenue and profit that topped analysts’ expectations.

Revenue in the three months ended in September rose 6%, year over year, to $1.78 billion, yielding EPS of $1.14, excluding some costs.

Analysts had, on average, been modeling $1.76 billion in revenue and $1.10 per share.

License revenue was up 1%, year over year, at $691 million.

CFO Zane Rowe said the company was “pleased with our Q3 financial performance, which exceeded the midpoint of our revenue and operating margin guidance” adding that the company “continue to broaden our portfolio with a range of products that will drive growth for the company.”

VMware said it formed a new business unit today, “Products and Cloud Services,” that will “extend VMware’s leadership across compute, storage, networking, management and business mobility,” to be run by Raghu Raghuram and Rajiv Ramaswami, and the duo will jointly take the title Chief Operating Officers, Products and Cloud Services.

Among other personnel shifts,

Sanjay Poonen is also taking on an expanded role as Chief Operating Officer, Customer Operations responsible for Worldwide Sales and Services, Channels, Marketing, and Global Communications. With these changes, Sumit Dhawan has been promoted to General Manager and Senior Vice President, End-User Computing, replacing Poonen in that role and Jeff Jennings has been promoted to Vice President and General Manager of the Networking and Security BU as Ramaswami moves into his COO role.

VMware management will host a conference call with analysts at 5pm, Eastern time, this evening, and you can catch a webcast of it on the company’s investor relations home page.

Update: On the call, VMware forecast results this quarter above expectations, and raised its year outlook.

The company sees revenue this quarter of $1.965 to $2.015 billion, and EPS of $1.37 to $1.41. That is better than consensus for $1.956 billion and $1.37 per share.

For the full year, the company now sees revenue of $7.025 billion to $7.075 billion, and EPS of $4.34 to $4.38 per share. That is up from the company’s prior forecast for $6.785 billion to $6.935 billion in revenue and $4.07 to $4.16 per share. It is also above consensus for $6.999 billion and $4.29 per share.

The stock is now up $2.49, or 3.4%, at $75.80.

blogs.barrons.com

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: Glenn Petersen who wrote (307)11/24/2016 11:06:26 AM
From: Puru rama
   of 345
 
VMware is one of the cheap stock to buy in 2017.At the list of cheap stocks at the bottom of this article, naturally. But there’s more to cheap stocks for 2017 than just a list of stock symbols.In fact, when it comes to rising earnings and revenue (something that has become a rarity on Wall Street), the technology sector is leading the way. With earnings season winding down, it’s clear to see that technology stocks are helping support the long-in-the-tooth bull market.

VMware, Inc.
Infinera Corp.

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: Puru rama who wrote (308)4/28/2017 9:41:16 AM
From: Glenn Petersen
   of 345
 
Zacks: Analysts Expect VMware, Inc. (VMW) to Announce $0.65 EPS)

April 18th, 2017
By Amy Steele

Brokerages expect VMware, Inc. (NYSE:VMW) to report $0.65 earnings per share (EPS) for the current fiscal quarter, Zacks Investent Research reports. Four analysts have provided estimates for VMware’s earnings. The lowest EPS estimate is $0.63 and the highest is $0.67. VMware reported earnings of $0.57 per share in the same quarter last year, which would indicate a positive year-over-year growth rate of 14%. The firm is scheduled to report its next quarterly earnings report on Monday, January 1st.

According to Zacks, analysts expect that VMware will report full-year earnings of $3.57 per share for the current financial year, with EPS estimates ranging from $3.48 to $3.66. For the next fiscal year, analysts anticipate that the firm will post earnings of $4.05 per share, with EPS estimates ranging from $3.96 to $4.26. Zacks Investment Research’s EPS averages are an average based on a survey of research analysts that cover VMware.

VMware (NYSE:VMW) last announced its quarterly earnings data on Thursday, January 26th. The virtualization software provider reported $1.43 EPS for the quarter, beating analysts’ consensus estimates of $1.40 by $0.03. VMware had a return on equity of 16.31% and a net margin of 16.72%. The company earned $2.03 billion during the quarter, compared to the consensus estimate of $1.99 billion. During the same quarter in the prior year, the firm earned $1.26 EPS. The company’s quarterly revenue was up 8.7% compared to the same quarter last year.

A number of research analysts have commented on VMW shares. Drexel Hamilton raised their price target on shares of VMware to $105.00 in a research note on Friday, January 27th. Oppenheimer Holdings Inc. set a $94.00 price target on shares of VMware and gave the stock a “buy” rating in a research note on Thursday, January 26th. Jefferies Group LLC raised their price target on shares of VMware from $91.00 to $105.00 and gave the stock a “buy” rating in a research note on Friday, January 27th. MKM Partners restated a “buy” rating and set a $100.00 price target (up previously from $84.00) on shares of VMware in a research note on Tuesday, January 31st. Finally, Zacks Investment Research upgraded shares of VMware from a “hold” rating to a “buy” rating and set a $103.00 price target for the company in a research note on Monday, April 3rd. One investment analyst has rated the stock with a sell rating, twenty-one have given a hold rating and eighteen have issued a buy rating to the company’s stock. VMware presently has a consensus rating of “Hold” and an average target price of $86.39.

Shares of VMware ( NYSE:VMW) traded up 0.39% during midday trading on Thursday, hitting $91.69. The stock had a trading volume of 1,337,287 shares. VMware has a 52 week low of $51.23 and a 52 week high of $93.05. The stock has a 50-day moving average of $91.07 and a 200 day moving average of $83.37. The stock has a market cap of $37.47 billion, a PE ratio of 33.01 and a beta of 0.97.

In other news, COO Sanjay Poonen sold 1,889 shares of VMware stock in a transaction on Monday, March 6th. The shares were sold at an average price of $89.04, for a total transaction of $168,196.56. Following the transaction, the chief operating officer now directly owns 182,569 shares of the company’s stock, valued at $16,255,943.76. The sale was disclosed in a legal filing with the SEC, which is available at the SEC website. Company insiders own 0.52% of the company’s stock.

A number of large investors have recently bought and sold shares of the stock. Dodge & Cox bought a new stake in VMware during the fourth quarter valued at approximately $745,926,000. Investec Asset Management LTD boosted its stake in VMware by 70.1% in the fourth quarter. Investec Asset Management LTD now owns 2,625,594 shares of the virtualization software provider’s stock valued at $206,713,000 after buying an additional 1,082,314 shares in the last quarter. BlackRock Institutional Trust Company N.A. boosted its stake in VMware by 2.0% in the third quarter. BlackRock Institutional Trust Company N.A. now owns 2,120,509 shares of the virtualization software provider’s stock valued at $155,539,000 after buying an additional 41,121 shares in the last quarter. DnB Asset Management AS boosted its stake in VMware by 49.2% in the third quarter. DnB Asset Management AS now owns 1,146,076 shares of the virtualization software provider’s stock valued at $84,065,000 after buying an additional 377,839 shares in the last quarter. Finally, Panagora Asset Management Inc. boosted its stake in VMware by 31.5% in the third quarter. Panagora Asset Management Inc. now owns 1,098,317 shares of the virtualization software provider’s stock valued at $80,562,000 after buying an additional 263,069 shares in the last quarter. 21.88% of the stock is currently owned by institutional investors and hedge funds.

About VMware

VMware, Inc is an information technology (IT) company. The Company is engaged in development and application of virtualization technologies with x86 server-based computing, separating application software from the underlying hardware. The Company offers various products, which allow organizations to manage IT resources across private clouds and multi-cloud, multi-device environments by leveraging synergies across three product categories: Software-Defined Data Center (SDDC), Hybrid Cloud Computing and End-User Computing (EUC).



thecerbatgem.com

Share RecommendKeepReplyMark as Last Read


From: Glenn Petersen6/2/2017 10:18:22 AM
   of 345
 
VMware beats profit estimates, raises full-year forecast

Reuters
Thu Jun 1, 2017 | 6:38pm EDT

Virtualization software maker VMware Inc ( VMW.N) on Thursday reported a better-than-expected first-quarter profit and raised its full-year forecast, fueled by strong demand for its software used by companies to boost cloud computing efficiency.

Still, VMware shares fell as much as 6.6 percent in extended trading after the company released its results, but pulled back to trade down about 2 percent after VMware provided the forecast on a call with analysts.

Summit Redstone Partners analyst Srini Nandury said the initial drop in the stock could have been due to VMware's billings — the total revenue plus the change in deferred revenue — falling short of expectations. Billings are an indicator of future revenue.

VMware has benefited from strong demand from businesses for its virtualization software that allows one computer or server to perform the work of multiple machines by emulating them, which boosts efficiency and helps cut costs.

The company's net income rose 44.1 percent to $232 million, or 56 cents per share, in the first quarter ended May 5. Excluding one-time items, it earned 99 cents per share.

The company said revenue climbed 9.3 percent to $1.74 billion, with services revenue rising 10.7 percent to $1.13 billion.

Analysts had expected a profit of 95 cents per share and total revenue of $1.71 billion, according to Thomson Reuters I/B/E/S.

VMware's adjusted operating margin of 28.5 percent was lower than its margin of more than 30 percent in the past three quarters.

The company, which is majority-owned by Dell Technologies Inc ( DVMT.N), said research and development costs jumped 18.2 percent, while sales and marketing expenses rose 3.7 percent.

VMware's billings of $1.35 billion was below Wall Street's estimates of $1.6 billion, Summit Redstone's Nandury said.

Still, the company's revenue forecast for the current quarter was better than expected, while it raised its full-year revenue forecast.

VMware forecast current-quarter revenue of $1.84 billion-$1.89 billion, while analysts' were expecting $1.81 billion.

Its profit forecast of $1.11-$1.14 per share for the period edged past analysts' estimate of $1.09.

The company raised its full-year revenue forecast to $7.61 billion from a prior forecast of $7.57 billion.

Shares of Palo Alto, California-based VMware have risen about 58 percent in the last 12 months.

(Reporting by Laharee Chatterjee in Bengaluru; Editing by Sai Sachin Ravikumar)

reuters.com

Share RecommendKeepReplyMark as Last Read


From: Glenn Petersen7/17/2017 3:03:32 PM
   of 345
 
h/t JakeStraw

Amazon is teaming up with its one-time enemy VMware to go beyond the cloud, says report
cnbc.com

Share RecommendKeepReplyMark as Last Read


From: Glenn Petersen8/29/2017 10:57:33 AM
   of 345
 
What You Need To Know About VMware Cloud On Amazon Web Services

Janakiram MSV , Contributor
Forbes
August 29, 2017

Almost after a year of the announcement, VMware Cloud on AWS is finally available to customers. At VMWorld 2017, both the companies highlighted the benefits of the partnership. Existing businesses using VMware stack can easily extend their virtualized data center to Amazon’s public cloud.



Source: VMware
VMware and AWS Partnership
________________________________-

VMware’s decision to embrace AWS as its public cloud surprised industry analysts as well as customers. After all, AWS was an arch rival that continued to threaten the core business model of virtualization and private cloud.

Subsequently, VMware sold vCloud Air, the original public cloud offering that was launched with much fanfare in 2013. It gave the company the opportunity to stay focused on its bets.

Will this deal help VMware in the long term? What does it mean to AWS, who is already the leader in the public cloud market? How will this partnership influence Microsoft? Let's find out.

VMware has done the right thing by getting rid of its public cloud business. Developing the data center management software is very different from managing the data center in itself. While VMware has proven track record of developing the virtualization platform and management tools, it realized it cannot handle massive data centers spread across the globe. Having taken the crucial decision of moving away from the public cloud, VMware swallowed its pride when it approached its key competitor for partnership.

Pat Gelsinger, VMware’s CEO and his leadership team were fully aware of the long-term implications of the deal. When you consciously exit a market segment to protect the interest of the core business, the next logical step is to partner with the leader in that segment. VMware has done precisely that – partnering with the public cloud leader. This move would also checkmate Microsoft, which is a much bigger threat than the public cloud. So, VMware hit two birds with one shot.

VMware's customers were already making a move to AWS eroding the revenue opportunity around vSphere and vCenter. On the other hand, Amazon started to build tools for vSphere to lure enterprises to its public cloud. With the IT spend moving to public cloud, it would be extremely challenging for VMware to convince customers to continue investing in its flagship products. The partnership with AWS eases the tension by enabling customers to use VMware products while still moving to the public cloud. The super aggressive sales teams at VMware can continue to push the envelope without ever fearing the public cloud threat.

When it comes to infrastructure, VMware can ride on top of Amazon's global footprint. Customers across the globe can choose a region closer to their data center for public cloud migration. VMware would not have built the kind of infrastructure that AWS delivers. When Amazon announces a new region, VMware can piggyback on it without the CapEx and the management expertise. This comes as a huge win to VMware and its ecosystem.

Here comes the best thing about the deal – VMware gets to run its own stack in AWS. It is not giving up on Sphere for Xen or NSX for VPC. For all practical purposes, VMware Cloud is the best rollout of its Software Defined Data Center (SDDC) platform running in 10+ regions. Customers consuming VMware cloud will not even realize that they are dealing with AWS. The whole user experience, tooling, pricing, licensing, and workflow is so familiar that customers wouldn’t even need to know that their virtual machines are running on Amazon’s infrastructure.
Source: Janakiram MSV
VMware Stack on AWS
_____________________________

The most interesting aspect of this deal is that AWS has become a co-location provider for AWS. Except for the underlying physical infrastructure, VMware stack doesn’t have any dependencies on Amazon’s cloud services. The bottom line is that VMware has got the most reliable and widespread real estate provider to run its public cloud.

If this is a such a strategic move for VMware, what’s in it for AWS? Andy Jassy, CEO of AWS is considered to be an incredibly shrewd businessman. His consent to this partnership means that it is certainly valuable for AWS in the long term.

Private cloud to AWS is what public cloud was to VMware. It is simply not their strength. Though AWS executives deny the potential value of private cloud, it is a known fact that many workloads can never move to the public cloud. Customers who benefited from the public cloud want similar capabilities in their data centers. This is, of course, the sweet spot for Microsoft. If AWS doesn’t have a strong on-premises to cloud migration story, Microsoft’s Azure Stack is waiting in the wings to take over the opportunity. Amazon’s partnership with VMware will counter the Azure Stack threat. With one stroke, AWS gained the foothold over some of the largest enterprises running VMware stack. It is now confident that even if customers run a different software stack, their workloads will ultimately run on AWS infrastructure.

With VMware cloud co-located with Amazon’s cloud, there is a potential opportunity to cross-sell and up-sell the services. Large enterprises, that are customers of VMware can easily move their data warehouses to Amazon Redshift. When their enterprise agreements with Oracle or Microsoft come for renewal, they can choose to go with Amazon’s relational database service. They can also take advantage of the emerging services related to Internet of Things, Machine Learning and Artificial Intelligence, where VMware has no role to play. Once the cross-pollination of services takes place, customers will never leave AWS. This will transform into an ultimate win for AWS. Amazon just got a very compelling value proposition for its hybrid cloud.

Finally, AWS will leverage the massive salesforce of VMware to drive their cloud adoption. Every new deal to VMware Cloud indirectly fetches revenue to AWS. This would open up additional GTM opportunities for the partner ecosystem.

Let’s shift gears and analyze the impact of this deal on Microsoft.

Microsoft has taken time to ship Azure Stack, its private cloud platform, a competitor to VMware’s vCloud Suite. The delay was mainly due to the changing market dynamics. Microsoft has learned from the mistakes committed by VMware. Redmond is clear that its private cloud offering should closely resemble the public cloud capabilities delivered through Azure. The modular architecture, parity with the public cloud and partnership with OEMs make Azure Stack a very compelling private cloud offering in the market. Microsoft’s goal is to move every System Center customer to Azure by making the migration seamless. The company is counting on Azure Stack to make this happen.

VMware Cloud on AWS will indirectly help Microsoft is telling a cohesive story to customers about its unified hybrid cloud strategy. It will emphasize on the fact that Azure on-premises and Azure in the public cloud is a better combination than VMware in enterprise and AWS in the public cloud. It will be interesting to watch how Microsoft will respond in the coming months.

These dynamics left Google in a strange position. Google got to fix its weak hybrid story. With AWS and Microsoft strengthening their hybrid offerings, Google is looking for a partner. It recently announced a deal with Nutanix for the same reasons. But Nutanix’s presence in enterprise data centers is much smaller compared to VMware and Microsoft.

The changing market dynamics will benefit enterprise customers. The platform vendors are sorting out issues to make it easy for the customers to move to the cloud, which is certainly a welcome sign.

forbes.com

Share RecommendKeepReplyMark as Last Read
Previous 10 Next 10