As we –Evan and I- were ranting last week about how OpenStack and VMware fit together (see #EMACloudRants), we were mainly focusing on the central conundrum that VMware faces within this context: “Should we support an open platform that could commoditize away a substantial part of our profitable infrastructure business or should we ignore the threat and do our own thing”

Based on a recent discussion with VMware, here are the arguments:

  • Yes, there still is a differentiation on the infrastructure layer. VMware ESXi, NSX, VSAN offer unique capabilities in terms of scalability and management for hosting traditional application workloads. vCloud Automation Center (vCAC) is great for the deployment and management of these application workloads. All this is true, but the gap is constantly closing and it will be increasingly difficult for VMware to keep its dominating market position in these areas, in the presence of free hypervisors and OpenStack.
  • No, KVM did not “fly” the way it was originally envisioned. EMA research has indeed shown that a large share of organizations is still afraid of adding KVM to their environment. By enhancing OpenStack’s vSphere support, VMware will be able to reassure this substantial group that they do not have to adopt an unfamiliar hypervisor platform to enjoy the advantages of OpenStack. This is obviously good for VMware.

  • OpenStack is currently a very workload-specific proposition. When looking at OpenStack, it is critical to notice that born-in-the-cloud workloads are still not the norm today. It is therefore essential to understand that use cases for OpenStack are still very specific and often limited to dev/test environments today. Of course, VMware’s formidable sales force will still push vCAC and only offer OpenStack if absolutely necessary. However, having a credible OpenStack story in the back pocket will enable VMware to control the damage that would result by customers going to another vendor and possibly getting talked into adopting more KVM or Hyper-V as the basis for their OpenStack cloud.
  • Management is king. The final and most important puzzle piece for VMware is the success of vCenter Operations Manager (vCOPS). I strongly believe that vCOPS is the one most important product when it comes to VMware’s future success. Once the vSphere business starts declining, vCOPS will be VMware’s universal “weapon” to offer service-centric holistic data center management of any physical, virtual and cloud platform. vCOPS will offer deeper and deeper support for OpenStack, as one of many platforms it is able to monitor and manage.

So what this comes down to is VMware accepting the fact that there will be open IaaS platforms out there. VMware has recognized that vilifying these platforms will be much more costly than embracing OpenStack. Of course, all this does not address the cost concerns that will come by hosting OpenStack on the vSphere platform and I strongly believe that eventually there will be no justification left for paying large sums of money each year for a proprietary hypervisor. But until then, VMware is doing the right thing by embracing the unavoidable and capturing additional business in the process.