New Visions for VMware

Customers anticipate advanced application models and software-defined datacenters from the cloud giant.

If you're VMware Inc., you're busy. Busy with virtualization. Busy with the cloud. Busy with apps. Busy with virtual datacenters. The list goes on and on, and the pressure builds, because staying on top in this industry is a 24x7 job with no breaks. So far, VMware has done its best work, but the future is nobody's friend, and there are no guarantees.

Yes, Pat Gelsinger, who is replacing Paul Maritz as CEO, seems like a perfect fit because he's tech-savvy and has worked with VMware for 10 years in his capacity as president and COO of the EMC Information Infrastructure Products division. And yes, Maritz is leaving Gelsinger with a company that's in great shape and hitting on all cylinders. Still, you just don't seamlessly subtract a force majeure like Maritz from a company that he has built into a juggernaut.

Under Maritz, VMware has stayed the course it started with server virtualization, and even though the cost and containment days are gone for many customers, VMware says the world is still only 50 percent virtualized. Plenty of opportunities remain to exploit server virtualization as it moves up the technology stack. Call it the first dimension.

The second server virtualization dimension, according to Cloud Infrastructure and Management Executive Vice President Raghu Raghuram, is all about applications that customers want to deploy on top of their virtualized platforms. These are apps that will dictate the kind of features and capabilities that these platforms will acquire -- apps that VMware hopes will define the future of the company's much-discussed journey to the cloud.

"There's a big transformation underway in how people build applications," Raghuram notes. "Applications that are built on the Web are highly distributed and built to a different architectural model than all those emerging applications such as Hadoop. They're built to different models, and they've become more mainstream. It's those kinds of applications that customers are going to want to run on virtualized platforms."

In the meantime, those customers want to know how they should virtualize their business-critical apps, and they're asking questions such as, "What should I do differently? What set of supporting tools will I need once my apps are up and running?"

It's not just about straightforward server virtualization, but increasingly about the peripheral areas surrounding that technology. Many of those areas -- including management, security and recovery processes -- have become hot market segments on their own, even as they remain in the gravitational field of server virtualization.

"We announced a software-defined datacenter vision, and that's a big part of what we're working toward. You'll see us delivering lots of the components of that software-defined datacenter over the coming months and year."

Raghu Raghuram, Executive VP, Cloud Infrastructure and Management, VMware Inc.

The Journey Continues
VMware's original journey to the private cloud, which started picking up serious steam around 2008, is built on its multiyear product vision. This vision has evolved from enabling IT infrastructures with the economic and operational characteristics of clouds by renting capacity from multiple services providers, and tying the infrastructures together in the form of Infrastructure as a Service (IaaS). This private cloud model extends core virtualization by introducing an enhanced operating environment that leads to more automated and standardized datacenters based on ubiquitous x86 infrastructures.

Raghuram describes how the initial VMware private cloud vision has now expanded to move beyond virtualizing servers to virtualizing entire datacenters. "We announced a software-defined datacenter vision, and that's a big part of what we're working toward," he says. "You'll see us delivering lots of the components of that software-defined datacenter over the coming months and year. That's the infrastructure side. The other parts are automation and management."

It's all part of a patient and deliberate overall strategy that includes infrastructure management, apps management and the management of IT as a whole, aka IT business management.

Although Raghuram says VMware is making solid progress in this portion of the journey, Mark Bowker, senior analyst at Enterprise Strategy Group, demurs. "I think it's still early days," he says. "What I'd say is it reminds me of the early days of server virtualization when people at first said, ‘No way. That's not going to work. I'm not moving my workload or application on that hypervisor, because it's going to present problems. There are performance and security issues.'"

Despite their differences on the state of VMware, Bowker and Raghuram see eye-to-eye when it comes to the idealized version of cloud computing that includes such elusive components as on-demand data access, rapid elasticity, self-service, usage measurement and rapid, bidirectional scaling.

"I'd say, in terms of customers actually doing this -- really scaling inside their IT shops -- it's still very, very immature," Raghuram says. "I'd say it's between 10 percent on the low end and 20 percent at the most."

Bowker looks at the situation more optimistically. "I think it says there's an opportunity there, right? If I'm VMware, I can move my customer base up the stack internally on-premises, and what I'm doing is providing more value from a management perspective," he explains. "My second option is providing my customers with alternative consumption models off-premises, so they can, for example, get Infrastructure as a Service from Amazon. However, managing across those two can be very difficult from a security perspective."

Welcome to the Virtual Datacenter
Not surprisingly, VMware is striving to keep customers close to home. That's where vCloud Director plays a critical role in the burgeoning rollout of private clouds that Raghuram says VMware has been experiencing during the past three quarters. All of those customers are starting with vCloud Director, which enables a new virtual server-based abstraction called the Virtual Datacenter. This offering is, in effect, a virtualized software representation of an entire datacenter -- including the requisite compute, storage, networking and security capabilities.

In this model, when business or application teams want datacenter capacity, IT can provision them with fully enabled virtual datacenters. These datacenters include many of those elusive cloud characteristics that are so attractive to organizations that are constantly implementing IT projects and production applications.

"Now, when each of these teams comes along, instead of giving them a bunch of servers, compute or hardware, and setting up the network, IT can set up these virtual datacenters, which are, if you will, datacenters fabricated entirely out of software. That aspect is resonating very well with customers," Raghuram says.

vFabric and Cloud Foundry: Open for Business
VMware made an open source commitment with vFabric (a suite of lightweight, scalable, integrated middleware for data-intensive custom applications) and Cloud Foundry, the company's Platform as a Service (PaaS) offering. This was done in the hope that the result would be a rich application-development architecture that encourages a wide range of diversity. Raghuram notes that neither of these two products is tied only to the VMware virtualization platform or its management products -- they run as well on competing systems as they do on vSphere. For example, Cloud Foundry also runs on top of OpenStack and Amazon Web Services.

"The roles that vFabric and Cloud Foundry play both in enterprise IT and the Web make it clear that application developers dictate everything in IT at the end of the day, because the applications they build are the ones that deliver business value, and the choice of their application architectures dictates what sort of infrastructure needs will be provided," Raghuram says.

Will VMware, as rumored, spin off Cloud Foundry as a separate business unit? Bowker is intrigued by the possibility. "One of the more interesting initiatives at VMware is Cloud Foundry, but the company has yet to monetize it," he says. "I'm still not sure what they plan to do with these assets, and how they'll turn them into a profitable business."

This much is certain: VMware believes application patterns will change as customers transform to cloud architectures, leading to a requirement for a new class of application platforms -- which is where Cloud Foundry will pay off for the company. In order to ensure that, Raghuram's vSphere team works closely with colleagues on the Cloud Foundry team in an effort to understand what the requirements are for running PaaS at high levels of efficiency, performance and scalability on top of IaaS systems.

Security Status
Security is the biggest impediment to the proliferation of cloud technology, and Raghuram asserts that VMware has been at the forefront of evangelizing the value of virtualization in improving security. He describes how, in today's legacy infrastructures, end users run a trusted endpoint: the desktop going over their trusted internal network to a datacenter that they own, where they have an application running on a trusted server. The standard plan there is to put lots of security protection around the perimeter of the network.

In the cloud model, users have an untrusted endpoint because most of them have mobile devices that the corporation may or may not own. This untrusted endpoint is coming in over an untrusted network -- which could be the Internet or an internal network (not trusted because of hacking and internal threats) -- and going into an application that's resident with an untrusted cloud provider.

As a result, it becomes essential to put security around the VM or application. Toward that goal, VMware has been working on building and enabling capabilities in its platform so the company's ecosystem can have the necessary protective mechanisms. VMware is also addressing compliance via the assets of vCenter Configuration Manager, which the company is cloud-enabling so that service providers can provide compliance to their tenants.

"We see this as a huge opportunity to both distinguish ourselves and make the cloud better and more acceptable for our customers," Raghuram states.

Horizon Technologies
VMware Horizon is VMware's play in the exploding mobile, anytime/anywhere consumerization segment of the virtualization and cloud markets. (See "A New Era of Enterprise IT,".) It provides an open, user-centric platform for the delivery of different application types within a unified application catalog for a wide range of devices. Raghuram calls it a way for enterprises to enforce consistent applications and entitlement regardless of whether an application is internal or a Software as a Service (SaaS) app hosted in the cloud.

Bowker says that a lot of IT organizations are thinking about Horizon strictly in terms of desktop virtualization, which misses the point.

"With Horizon, you need to be thinking about how you're going to deliver virtual desktops, how you're going to virtualize applications, and how you're going to have Software as a Service for the applications," he states. "Some of these apps may be more well-known than others, but in the end, organizations want to be able to broker them all so they're essentially the control point for everything going on and off end-user desktops." Bowker also lauds the VMware Project Octopus online file-management system, and says it's necessary to think about files as well as desktop applications.

Simon Bramfitt, founder and research director of Entelechy Associates, says VMware uses Horizon as an aggregation engine and delivers Windows apps either through View or Project AppBlast, which enable users to use remote applications of any type and platform and deliver them to any HTML browser or device. As he describes it, VMware delivers file services through Project Octopus and Web services through the central Horizon engine. "This very much aligns with my vision of the way that computing is heading," Bramfitt declares.

He compares and contrasts the VMware Horizon vision with the perspective of Citrix Systems Inc., and says the big difference between the two companies is their central point of aggregation. VMware, he says, is focused on a cloud-based approach, while Citrix is aggregating on the desktop or the endpoint with Citrix Receiver technology.

"It's interesting to see this parallel strategy in terms of delivering technologies," he says. "I look forward to seeing who is capable of delivering an enterprise-class service first."

Turning to virtual desktop infrastructure (VDI) and desktop virtualization, both Bramfitt and Bowker claim that the high up-front costs, excessive complexity and shared storage messes that have brought so many VDI projects to a sudden halt are now passé. "It's complete rubbish," Bramfitt says. "It's put out by the people who want to perpetuate an argument that no longer applies. The technology is now good enough, the storage problems have been solved, and the cost of VDI has dropped to a point where if it's done right, it can compete with the cost of a PC desktop."

Regarding shared storage problems, he cites Virsto Software Corp. and Atlantis Computing Inc. as two companies who have exploited hypervisor caching and de-duplication technology to the point where, instead of needing an expensive SAN infrastructure that costs up to $1,000 per desktop, users can realize the same benefits for $50 per desktop.

"The same thing applies to a great many other problems with VDI as it was," Bramfitt states. "We used to complain that the thin client was costing as much as a low-end PC. That's no longer the case. We can get good-quality thin clients now for $150. You just can't use these arguments of two years ago and expect them to apply today."

Bowker agrees, saying that the old impediments made a great conversation two years ago, but now VMware and Citrix are increasingly addressing these issues from a software perspective -- for instance, via server-side caching. He also says that storage vendors are creating more thoughtful architectures that go beyond simply standing up a bunch of solid-state disks in front of a storage system to stage desktops before users log on. His prediction: "massive improvements very quickly, over the next 12 months."

Microsoft Making Moves
Raghuram is low-key on Microsoft Hyper-V, despite the fact that version 3 has been highly praised in many quarters for its enhanced functionality, cost-efficiency and compatibility with Windows 8. When he's asked about the sweet spot for Hyper-V, he says: "There has always been a die-hard constituency in the marketplace that for a lot of reasons has wanted to use Microsoft-only products, so I'd say that's the place where I expect a lot of the Hyper-V 3 and Windows 2012 impact to be. In the long run, customers will have to value the tradeoffs of running multiple, different platforms and what they'll gain from it. That's going to dictate how much the customers use Hyper-V."

From a feature functionality point of view, Raghuram says there's clearly no reason for a VMware customer running vSphere 5 or 4 to believe they would be better off using Hyper-V, because they've already paid for and put all their operational processes around vSphere. Plus, he adds, vSphere has a tried-and-tested core base with 200,000 customers. "With Hyper-V 3 and the new OS, even if you assume it's the greatest thing since sliced bread, it's still an untried and untested OS, and it's a different OS, so it's a big transition," he notes.

Bowker sees Hyper-V as more of a threat to VMware. Noting that his company has tested Hyper-V in its labs, and referring to his conversations with many customers on this topic, he says: "In many cases, [Hyper-V] is on a par from a technology perspective with what VMware offers from a pure hypervisor perspective. I'd also say that Windows Server 2012 completely changes that further and makes Hyper-V all that much more interesting -- even if you're a VMware customer still looking at Hyper-V in your organization."

When the topic turns to how Citrix and VMware differ in their approaches to consumerization, Raghuram says that VMware's approach is to look at the post-PC era as the fundamental driver of how enterprises should be looking at their futures. He separates Citrix from VMware by noting that Citrix is more "rooted" in its XenApp display and app-delivery approach.

"If you think about the things that make money for Citrix, it's the application-delivery franchise and then NetScaler, which is a Web application-delivery product," Raghuram notes. "So they look at the world from an application-delivery perspective, while we look at the world from an end-user mobility perspective: How do operations provide end users with the level of consumerization they need, while at the same time preserving the security, manageability and policy controls that enterprises had with respect to their traditional desktop environments?"

When all is said and done, what really matters to VMware is that its customers are happy. But are they? Bowker says yes. "To be honest, all of the VMware customers we meet speak very positively about VMware. Everything they have to say -- about the technology, about working with the company, about how they're currently using its products -- all are relatively good things," he notes.

So while it's still all good for VMware, the competitive heat is getting turned up in Redmond as Microsoft increasingly looks like it, too, is betting the business on cloud. To date, the now-departed Maritz and company have played it cool when it comes to Microsoft, but it's a calculated cool. VMware is not a company that has gotten fat and happy at the top, or dismissed its competitors as mere pretenders. There's a strong sense of innovation driving the hundreds of VMware engineers that are hard at work developing the next wave of products. Dealing with Microsoft and Citrix is no trivial task, but VMware is up to the challenge.


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