Will 'good enough' virtualization topple VMware?

Could VMware be the next Novell? That's the question Gartner managing vice president and chief of research for Infrastructure David Cappuccio asks in a provocative post, one that bears further discussion. While VMware is at the top of its game, there are several historical analogs between VMware and Novell.

I'll let you read Cappuccio's excellent post for his full argument, but the crux of it is that in the face of dominant but pricey technology, many buyers will turn to "good enough" to fill their needs. For Novell, that competition to its 90 percent market share came from Windows, which displaced Novell's "great technology that was more complex (or complete) than most customers needed."

Today, VMware faces a host of rising threats. Cappuccio picks out Microsoft's Hyper-V as chief among them:

[L]urking in the background is this little thing called Hyper-V; not as robust, or as tested as VMware, with almost no install base, and certainly not ready for prime time in most people's minds. However, it will be an integral part of Windows 7, Windows Server 2008 and Windows Server 7 in 2010. Why should you (or VMware) care? Because like "free networking", or "free SharePoint", hyper-V will get used, slowly at first, but as more and more systems get installed the base will increase and within just a few short years companies will discover (surprise, surprise!) that they have business applications running on both VMware and Hyper-V.

Free-and-good-enough is a great strategy, and one that Microsoft has long used to exceptional effect.

Of course, Microsoft isn't the only one playing this game. Xen is included for free in Linux, though Red Hat is pushing to move users to KVM (and succeeding to an increasing extent). Virtualization customers are spoiled for choice.

All of which leaves VMware exposed. This isn't to suggest that VMware should resign itself to obliteration. Indeed, VMware has gone on the offensive, releasing a host of software as open source to combat open-source alternatives, most intriguingly its open-source virtualization client, as OStatic's Sam Dean notes.

Novell didn't respond to its Netware demise until it was too late. VMware seems to be learning from history.

The real question is whether it will be able to go as low as Microsoft and the Linux vendors on price while still maintaining "good enough" profits. I suspect it will fail in this because for VMware, virtualization is core and it must price accordingly. For Microsoft, Red Hat, and Novell, virtualization is a critical complement, but not the core of their businesses. Complements are cheap, core is not.

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[atwattersjames]

Yes, about 1k times yes. Just look at the cloud hosting providers and almost none of them offer VMware VMs.

VMware is NOT a hot new development--new application technology. Its an enterprise consolidation play for the most part.

Note that VMware had to personally invest in their one hosting provider to keep them going.

http://www.thewhir.com/web-hosting-news/062409_Terremark_Closes_420M_in_Senior_Secured_Not

[Random_Walk]

You do realize that most "cloud" providers don't use much in the way of customer-facing virtualization in the first place?

[pentest]

VMWare has some terrible software. VMPlayer being the head of the crapware parade.

[Gasaraki]

Wow... Ok. I didn't realize I was using suck crap. Let me switch at once...

[tristanbob]

I have worked with Vmware in the past and I have been impressed with what it can do. That said, I was confident that Vmware was doomed because of the free/cheap alternatives that performed many of the same functions. However, Vmware has surprised me with the great new features they have created in the newest version of their product, Vsphere 4.0. I think they will be able to keep most of their marketshare due to these innovations.

I think that "good enough" solutions will always be attacking the best solutions. This forces the leader to keep improving to stay in the lead. Of course, customers have different priorities, and some will always choose the cheaper solution, because it is "good enough" for them.

You can ask this exact same question about every other product. Will MySQL topple Oracle?

[servermaker]

Nope, but microsoft is doing a pretty darned good job of eating in to their core database business...

[Random_Walk]

Show me one that does what VMotion does, then we'll talk. Until then, I can guarantee you that the only IT departments using the alternatives for mission-critical applications, are departments about to see a few unemployment slips when something breaks.

[baetica]

People should remember their history. Almost all technology franchises are not destroyed by competition, they're destroyed by a company's mis-steps. Netware 4 was a disastrous product execution that destroyed Netware's networking franchise. It was buggy to the point of tears, it was Netware 3 incompatible (I mean surely everyone has learned by now that you make your stuff backward compatible or suffer irrelevance - Google App Engine anyone?)

[darkxeno]

I've used VMware and have dumped it in the last two years after they started installing 3-5 extra services in windows was a good product at one time but like baetica said every company falls due to their own errors. Heck even Apple and Microsoft has taken big hits for their steps in life.

[qnet]

Nothing in the Red Hat article you linked says anything about anyone shifting to KVM other than the vendor itself.

[jkohut]

Having lived through the original Novell Netware fall from grace, I suggest the following:
VMWare should work with Colleges,Technical Schools, etc.. to provide Free versions of the software for training new VM Adminstrators AND they should continue to provide good online support at a free cost. If you make the implementation/support experience easy for less technically oriented people people will embrace it. VMware/EMC should purchase Double-Take (before Microsoft does) software and integrate that technology into it's VMs for failover to remote locations for DR.

[ianrbruce]

It's too easy to confuse a product (NetWare) with a company (Novell). Cappuccio's analogy might work at the product level, but fails at the company level.

Novell is a much different company today: the second largest provider of Linux, from the desktop to the data center; a technology leader of identity and security management solutions; and a longtime leader in the collaboration market. We even have a unique set of solutions for virtualization and workload management products that complement - and compete - with VMware.

[ianrbruce]

It's too easy to confuse a product (NetWare) with a company (Novell). Cappuccio's analogy might work at the product level, but fails at the company level.

Novell is a much different company today: the second largest provider of Linux, from the desktop to the data center; a technology leader of identity and security management solutions; and a longtime leader in the collaboration market. We even have a unique set of solutions for virtualization and workload management products that complement - and compete - with VMware.

[Mark Burgess]

God I hope not, but Microsoft has a great history of winning with mediocre products, because they can afford to "give them away". At least at first, the pricing is hard to resist, and the integration is easy, and by the time you realize you have a piece of junk it's too late.

Microsoft's efforts in virtualization cannot be compared to the robust, enterprise-ready solutions provide by VMWare. However, as the author points out, VMWare may make mistakes.

On the Novell subject... it was really the fact that is was easier to migrate from Netware 3 to NTAS than to Netware 4 that killed Novell as a NOS company. Too bad, because Netware was way superior. Did anyone really like NTAS?

[bananaphonerules]

Hyper-V rocks along (never stopped). VMWare Server died for me after 2 days...a huge pain.
"Not as robust" my hairy bum.

[adoyle75]

as anyone who work in IT for while will a test to its hard to get people to change there ways ,people
like what they no , atm I think it will be difficult for anyone else to make any real meaning dent in vmware
market share unless they start to **** off there customers .

[Andres_Garcia]

I have begun testing KVM in Fedora 11 this week, seems nice so far even though configuring the
virtual networks needs to be easier (like a lot)

[Marauder62]

You may be on to something, but let's also remember the timeframe that Novell fell from grace. Netware was Novell's bread and butter, their core competency. MS was really just getting started, they had Windows 3.1 running on Lan Manager with NT just about ready to be released.

MS was already showing some muscle with Office. And then Novell decided they wanted to get into the applications business. I truly beleive this was a fatal mistake for Novell. Netware seemed to kind of stall out in favor of Novell applications. Meanwhile, MS threw all kinds of development muscle behind NT and the creation of some really excellent Netware to NT migration tools.

Novell did not acknowledge the threat to their core business until it was too late. MS had already convinced the majority of the market that NT was easier, "good enough" and less expensive than Netware. I truly beleive that if Novell had stayed the course and not neglected their core, NetWare would still be a relevant, maybe even dominant, platform today.

WordPerfect made a similar stumble. MS Office Word did not really take off until the release of the truly horrible WordPerfect 6. However, in this case MS was beneficiary of being in the right position at the right time. When WordPerfect stumbled, MS pounced, as any company in that position would have. WordPerfect has never recovered.

[msondge]

What Microsoft will do as they always have, is create roadblocks in the new versions of windows to prevent companies like VMware from being able to successfully run windows and windows apps. they have done it again and again, and will continue. They will do anything to protect their monopoly.

[ooprus]

One of the things that killed Netware was it didn't use TCP/IP. Everybody shifted to TCP/IP and Netware, with its non-standard network protocols (IPX) were left behind. You could not exactly develop your own apps to run on a Netware server either (there was no user/kernel mode split). The *nix world never embraced IPX, and people didn't want to run both TCP.IP and IPX protocol stacks.

It's probably hard for most people now to even imagine not running TCP/IP and apps on their server. Microsoft servers also are not an equivalent replacement for a Netware server, a Netapp/EMC file server is. People needed someplace to run server apps too, Windows Server and *nix is that place.