MS, Sun, Apple all knows about potential in bring in the idea into their home product rather than letting it survive sideways. In past, MS has brought lots of famous product idea into their MS Office. They never let anyone be a recommended plugins for their software.
HyperV is a killer for VMware. Sun has its own. Apple will come out with their own very soon. VMWare employees ……. run baby run …..

MSFT is preparing something in the search engines business too. We see too many bots from them since 9months.

And he also was quoted as saying:

“We’ve experienced really explosive growth over the last year — it’s really important to make sure that you are digesting the growth.”

So maybe VMware just has a tummyache and needs another quarter to digest??

I just want to know if BlueLane was an “wafer-thin mint” or if the tummyache has passed – we will all find out on Tue, Oct 21, 2008, 5:00 pm (EST) for their Q3 earnings conference call.

But the issue why they are losing revenue is because people are running more and more virtual machines on the physical hardware – today’s ESX servers are quad socket, quad cores with 128 GB of RAM – running densities of 40:1 or better.

So if you had 1,000 physical servers to virtualize in 2H06 and your hardware was dual socket, dual cores with 32 GB of RAM you probably got 10:1 ratios so that’s 100 ESX licenses or $600k in revenue for VMware. Fast forward just 1 year, and in 2H07 – people are buying much bigger boxes – quad socket, quad cores with 128 GB of RAM and are running 40:1 ratios – so that same 1000 Servers would only require 25 ESX licenses or $325k.

Get it – $600k vs. $325k – and to think an ELA is based on VM count not servers (gee I wonder why) – they want to pin the pricing based on the VM’s because they understand higher density computing is slaughtering their revenues.

Less ESX servers means, less Virtualcenter agents to purchase, smaller hardware footprints is better right? smaller power consumption? greener? smaller hardware maintenance costs? Aren’t these all reasons why we virtualized in the first place – less is more?

So 25 ESX hosts is better than 100 ESX hosts – consolidation, etc – who loses? VMware – their revenue shrunk because AMD and Intel came out with Quadcore and they stuck with socket licensing vs. core licensing and 4 GB DIMM modules got very cheap – the BL460c which was a staple for HP blades standed CPU because it couldn’t run more than 32 GB of RAM and people were barely pushing 10% of their CPU’s. That’s why HP and Dell both announced new “Virtualization blades” which just meant more DIMM banks – meanwhile all of the larger ESX shops aren’t running blades – they are running DL585s or r900s and taking advantage of the larger memory capacity and you can get to 128 GB with the 4 GB (which is much cheaper than the 8 GB DIMM).

I want VMware to have a good Q3 – I really do – and so do the ton of people in the last 18 months.

And if the Q3 or Q4 revenue isn’t there to support – who knows what a smart business man like Paul Maritz does in Q4 – especially if one of the options is to lower prices to compete with Microsoft.

Sun reaches 5 million downloads with VirtualBox URL:
http://www.reuters.com/article/pressRelease/idUS98171+29-May-2008+BW20080529

xVM Ops Ctr availability announcement
http://news.moneycentral.msn.com/ticker/article.aspx?Feed=BW&Date=20080910&ID=9124959&Symbol=US:JAVA

But they were too cocky. They did sense MSFT as the main threat, but too young/inexperienced management to move aggressively into acquisitions. Also they were too hung up on grades/schools/pedigree (kinda like Google, but at least they didnt ask about your College GPA decades later).

In the end they couldnt focus, establish a good hiring pipeline, and finally build products, not features.

Getting rid of Diane may have been needed, but not that way. She really did make the company and even though she wasnt one to lead it forward, they should have axed the entire management team and gotten some real talent in there.