VCE Thursday boasted that its converged infrastructure systems based on VMware, Cisco and EMC products have hit a $1.8 billion annualized run rate, with Vblock sales growing at well over 50 percent in the first quarter.
EMC CEO Joe Tucci says the EMC-Cisco partnership has "revolutionized the IT industry." Cisco CEO John Chambers says he views VCE as a "natural extension" of the networking giant's application-centric data center strategy. And VCE CEO Praveen Akkiraju, a 19-year Cisco veteran, is promising that the VCE alliance will stay ahead of the innovation curve.
In the sales trenches, however, partners say the story is decidedly less rosy. Multiple sources close to VCE told CRN the alliance is showing new signs of strain that could impact future sales.
While there has always been some give-and-take between EMC and Cisco within the VCE alliance, sources said there are new tensions developing between the VCE company and EMC. Which means customers that have accepted the ongoing EMC-Cisco squabbling now have a new reason to wonder if the VCE alliance is really an alliance.
According to several VCE partners, EMC sales reps that used to lead with Vblocks in converged infrastructure discussions with customers are no longer doing so.
Instead, EMC sales reps are pitching in-house technologies from what EMC calls its own "unique federation of strategically aligned businesses" made up of EMC storage, Pivotal big data technology, VMware's various types of virtualization and RSA security software. VCE is not part of the federation.
"They want to make it more of an EMC story, and a VMware NSX story," one VCE partner said of EMC's sales efforts.
A VCE spokesperson told CRN that Vblocks are "incredibly well positioned as preferred converged infrastructure" for the EMC federation. "The EMC federation represents a tremendous opportunity to drive greater customer adoption of VCE's industry-leading converged infrastructure portfolio," the spokesperson said.
Meanwhile, VCE sales reps are firing back by going after customers directly. They're now competing with EMC by pitching Vblocks -- which feature pre-integrated EMC storage, Cisco UCS servers and networking, and VMware server virtualization -- on their own.
"The VCE reps are saying if EMC isn't going to bring us into deals, we're going to go after deals ourselves," one VCE partner said.
VCE operates independently with its own sales force, even though EMC owns 58 percent and Cisco owns 34 percent of the five-year-old company.
The end result, according to one VCE partner who didn't want to be named, is that EMC reps are engaged in a "mini war" with VCE sales reps. Multiple sources told CRN they believe the tension is a direct result of Cisco and EMC's competing visions for the future of software-defined networking.
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