VMware Rallies Partners On Server, Desktop Virtualization

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VMware on Tuesday opened the formal portion of its VMware Partner Exchange with new product promotions, hints of upcoming products, a review of its cloud strategy, and attacks on competitors Microsoft and Citrix

The company this week is in Las Vegas holding its annual VMware Partner Exchange.

After a couple of days of partner breakout sessions, VMware formally opened the conference with a keynote presentation by Carl Eschenbach, executive vice president of worldwide field operations, who told the 2,800 attendees at the conference that attendance was up about 50 percent over last year.

Eschenbach said the increased attendance at the conference shows partners know the importance of working with VMware, despite the fact that rival Microsoft includes for free its Hyper-V virtualization technology, which is included as part of the Windows 2008 operating system. "I say to Microsoft, partners know they can't make money on something that's free," he said.

While early 2009 saw VMware executives wondering what the economic downturn might mean to the industry and the company, Eschenbach said VMware decided to continue to invest in product and channel development, including its vSphere virtualization platform for cloud computing, a new VMware Partner Network channel program, and $5 million on new partner tools including MDFs and lead generation via Salesforce.com.

In the end, 2009 revenue actually grew 8 percent over 2008, and VMware expects 2010 revenue to grow between 21 percent and 26 percent over 2009, Eschenbach said.

The drivers are CIOs who, according to a recent Goldman Sachs survey, rate server virtualization as their number one priority, followed by desktop PC virtualization, he said.

But while server virtualization is the top CIO priority, VMware is thinking about what comes next, particularly in terms of cloud computing, Eschenbach said. "We are not a server virtualization company any more," he said. "We are a platform company."

Another major focus for VMware is virtual desktops, which Eschenbach called a much, much larger opportunity than server virtualization.

Eschenbach said that there are over 650 million PCs in the market today, only 1 percent of which are virtualized. That is at a time when 85 percent of CIOs in a Goldman Sachs survey earlier this year said they will be starting to deploy virtual desktops, up from 40 percent in a similar survey last year.

"That's why we see this year as the tipping point in desktop virtualization," he said.

Currently, about 80 percent of virtual desktops are on the VMware platform, a situation Eschenbach said represents a potential danger for rival Citrix.

Citrix, Eschenbach said, is in a fight for its life because, if it loses the race to virtualize desktop PCs, the loss would be significant. "We're going after (Citrix)," he said. "With the next version of VMware View, they're in trouble."


Next: VMware Plans To Help Partners Push The Virtual Desktop Message

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