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All of this represents a major strategy shift for VMware, whose longstanding public cloud policy has been to allow its service provider partners to handle this business exclusively. Under this model, VMware channel partners are expected to steer their customers to public cloud service providers and collect referral fees.
However, as was evidenced first by Project Zephyr, and now with VMware Public Cloud, VMware isn't satisfied with how the strategy is working out.
Meanwhile, as Amazon's cloud business continues to accelerate -- Amazon Web Services had $2 billion in revenue in 2012 and is on track for $3.8 billion this year, according to Macquarie Securities Group -- VMware has apparently decided it's time to change its approach to the public cloud market.
At VMware's annual Partner Exchange conference in Las Vegas earlier this week, VMware CEO Pat Gelsinger urged partners to help battle Amazon EC2 on all fronts, suggesting that anything less could pose grave consequences for the entire VMware ecosystem.
"We want to own corporate workload," Gelsinger said at the event. "We all lose if they end up in these commodity public clouds. We want to extend our franchise from the private cloud into the public cloud and uniquely enable our customers with the benefits of both."
VMware COO Carl Eschenbach went a step further, telling partners he finds it "really hard to believe that we cannot collectively beat a company that sells books."
VMware holds a commanding position in the private cloud, but as several industry watchers noted this week in response to Gelsinger and Eschenbach's comments, the public cloud is a different animal.
"A cloudwashed vSphere environment that takes two days to deploy new workloads, fulfilling requests through the help desk and having no cost transparency will lose every day to a public cloud," Forrester analyst James Staten said in a Thursday blog post.
PUBLISHED March 1, 2013
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