See the virtualization giant VMware cracked the transformation board

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(for VMware Global CEO Pat Gelsinger)

"This year is the year of VMware's transformation, and our core computing virtual business has grown very fast, accounting for 80% of the global market." On the basis of such a market share, and then go up, there is a certain difficulty, so that this year is a transition year. ”

April 14, VMware Global CEO Pat Gelsinger in Beijing, the virtual software giant has just announced that it will lay off 800 people, and since last year a number of senior executives have been separated, including China's regional CEO. Born in 1998, VMware has a history of more than 18 years, with a market value of $40 billion. VMware now occupies 80% of the world's X86 server virtualization market share, to some extent, has become synonymous with virtualization.

However, the current global IT industry has undergone structural fundamental changes that have impacted all of the business. In the same one-month period, the giant Intel also announced that it would lay off 12,000 people and would restructure with $1.2 billion. This has become a challenge for many giant companies: past high-growth encounters with ceilings, which already occupy the vast majority of existing markets, what to do next?

Once overlord was blocked by cloud computing

VMware's housekeeping skills is the virtualization of the X86 server, which is considered by the industry to be no more. Based on the 2015 Gartner Magic Quadrant for X86 Server virtualization, VMware is ahead of the leadership first camp.

From 2011 to 2014, the number of VMware virtual machines increased by three times times because VMware provided not only virtual machines, but also optimized management of X86 servers, ensuring that virtual machines were not down and the overall system was absolutely stable and reliable. VMware has a market value of more than $40 billion, the main reason is the financial, telecommunications, manufacturing and other industries critical applications are running on VMware software.

However, the same is true of the X86 server architecture, where virtualization software from traditional on-premises data centers is being impacted by cloud computing software in public cloud data centers--a large number of internet companies and cloud computing vendors are developing their own virtualization software based on open source technology, which in turn affects the technical decisions of traditional enterprises. Thanks to the more expensive VMware software, the OpenStack faction, driven by Intel, is continuously releasing a lower-priced open source solution that replaces VMware software.

What happens next? According to Pat Gelsinger, "cloud computing is new hardware."

What do you do with "New hardware" business?

How do you understand "cloud computing is new hardware"?

Virtualization technology is a software that targets virtual servers, not physical servers. From this point of view, the software that carries the virtual server is a kind of "hardware", it is a kind of hardware that is soft and hard. Cloud computing is actually for the Internet application, through the cloud operating system to make a large number of inexpensive X86 server cluster "new hardware." Of course, unlike the requirements of an enterprise's critical application environment, Internet applications allow some degree of error and downtime.

For VMware, it is obvious that if you enter the public cloud business, it is obviously expensive, not worth the candle, and the internet business is not what VMware, the enterprise, is good at--HP and Dell have given up on the public cloud business, which is enough to prove it, but if you are not connected to the public cloud, Obviously will miss the next round of industrial development opportunities.

VMware, at the crossroads, has chosen to develop new software that enables enterprise customers to leverage different cloud platforms for resource sharing, in fact, hybrid cloud business. Simply put, VMware does not do the public cloud business, but it can find the next gold mine by doing what it does best to connect between private and public clouds.

To do this, VMware chooses to enter the virtual network product NSX. Pat Gelsinger said that VMware NSX is not only for VMware's environment, but also for non-VMware environments, such as the Amazon Cloud, Microsoft Azure to provide NSX products, the original can only be used in the VMware environment of the technology extension to non-VMware cloud environment , "It's a bold move for us."

According to the company's latest annual earnings, VMware NSX network virtualization products grew by 100% in 2015, earning more than $600 million a year. Another storage virtualization Product Vsan also has a decent performance, the fourth quarter of 2015 growth of nearly 200%, the annual revenue of more than 100 million U.S. dollars. The Network virtualization product NSX is expected to reach $1 billion by the end of 2016, and the storage virtualization product Vsan has already had $100 million in revenue in 2015.

In the cross-hybrid cloud management, VMware launched the Vrealize Automation 7 in the first quarter of this year, with a unified service blueprint that accelerates the multi-tier application delivery process across hybrid cloud environments. "This year's new business has grown enough to complement traditional business. We are expected to launch 17 new products this year to accelerate growth. ”

Become a partner of the client

Pat Gelsinger is the 36th time to come to China, this trip includes attending the CIO Summit in Beijing (a long time since VMware has not hosted a direct client-facing CIO Summit), and attended the inauguration of the company in the Dawn joint venture. In addition, VMware hosts the global excellent sales club meeting in Beijing.

Intensive activities have demonstrated the importance that Pat Gelsinger to the Chinese market during the critical transition period, and VMware, which is experiencing a growing ceiling, is looking to transform itself from product innovation, connecting customers, and expanding into new markets.

It's been a long time since the company last held a CIO summit, Pat Gelsinger said, "re-establishing connectivity with customers is the most important strategy for VMware." Direct contact with the end customer is, in fact, the need for a hybrid cloud and solution business. VMware is becoming a solution and service provider from a purely product provider. The hybrid cloud and software as a service accounted for 7% of total revenue in the first-quarter results of VMware for the period ending March 31.

The establishment of a joint venture with Shuguang is a key strategy for VMware to target the Chinese market. As a foreign company, VMware in the Chinese market has 20% to 30% market share is difficult to reach, unless you can find a very strong state-owned enterprises or central enterprises to cooperate, from the dawn of CAS has brought this opportunity. Since the end of October last year when both sides announced the establishment of a joint venture, it took only 6 months to complete all the processes established by the JV company.

In the future, VMware is also looking for "partnership" opportunities with more Chinese companies in different areas, including virtual networks, security, and mobile business management, said Pat Gelsinger. Many enterprises, after trying the OpenStack solution, found that open source virtualization management products are not stable and reliable, and need to be combined with VMware's products, which also creates a lot of new business opportunities for VMware.

"I went to the Great Wall with our salesman and took a picture on the Great Wall. At the same time on the Great Wall, also tree a small monument, explaining the commitment of VMware to the Chinese market. I hope that after 1000, we will see that we have been very concerned about the Chinese market so early. (Wen/Ningchuang, the first titanium media in this article)

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See the virtualization giant VMware cracked the transformation board