VMware’s Journey to Cloud Applications

By now you've seen the news that VMware has acquired Socialcast as a complement to their recent purchases of Sliderocket and Zimbra.  Add in the launch of their own Horizon App Manager and VMware has some interesting building blocks for enterprise cloud applications.

With the move on Socialcast, they continue to invest aggressively in the next wave of cloud based enterprise collaboration solutions.

To understand VMware's vision for enterprise collaboration, it is worth reading CTO Steve Herrod's reasoning for the Socialcast acquisition:

"First, let’s step back and look at today’s approach to enterprise communication. For the last 30 years, personal computing has primarily focused on automating the metaphors of the pre-digitized workplace including the “inbox” and “outbox” tray, manila folders, and printed documents. We’ve largely replaced printed memos, mail carts, and filing cabinets with documents, email, and file shares. These tools have dramatically improved our productivity, but the increasing volume of information can be overwhelming and requires manual prioritization and organizational work to keep up with this data deluge.

While traditional mail- and document-centric interaction will certainly remain critical, there are new approaches to collaboration taking root that better exploit the paradigms of the web. For example, communication is increasingly iterative, with fine-grained interaction replacing letter-like back-and-forth. Furthermore, these activity streams increasingly take place across dispersed groups of informally linked collaborators rather than following the boundaries of a formal organization hierarchy. And in today’s frantic world, the information in these activity streams should only interrupt the right people at the right time… and of course be safely archived and searchable. In summary, there is an opportunity for improved collaboration across a company that can drive new levels of productivity and employee satisfaction.

So to summarize Steve's points on the new wave of collaboration, he focuses on how collaborative communication is changing:

– Communication is iterative

– Communication streams occur across informally linked collaborators

– Communication should interrupt the right people at the right time

– Communication streams should be safely archived and searchable

These are all great points and ones I embrace and support.   I like the vision and see how their acquisitions fit together accordingly. 

But, for me, it still begs the question

"Why is VMware moving into the enterprise collaboration space at all?" 

As I look at VMware's industry, company and product positions, along with their acquisitions and push into the enterprise collaboration market, it is clear their strategy is to use their leadership in infrastructure virtualization to address the bigger customer pain point around cloud applications and services.

VMware is the leader of infrastructure virtualization.  Today it is their core business.   Yet, as they continue to grow their core business, I believe they see even more growth beyond infrastructure.  A larger opportunity for growth is tied to applications.  

VMware sees themselves helping enterprise customers on a journey from on-premise independent infrastructure to virtualized, cloud based applications and services.

As VMware has conversations with customers about infrastructure pain points and how virtualization and the cloud architecture offer solutions, they are also hearing about the next set of pain points for enterprise IT organizations related to applications.   Large enterprise customers are trying to figure out:

1. Should I migrate my enterprise applications to the cloud?

2. If yes, which applications should I move, and how fast?

3. Which applications will need to be rewritten for the cloud?

4. Which applications will never be provided from the cloud?

5. Which new cloud based applications can improve performance?

Most large enterprise customers intend to use savings gained from infrastructure virtualization to fund the migration and rewrite of legacy applications to be hosted or provided from the cloud.

So as VMware talks with their enterprise customers about virtualization and infrastructure, it is natural for the conversation to include the bigger challenge of applications.   As a result, VMware has the opportunity to talk about when,which and how to migrate existing applications (#1-#4 above) to the cloud AND – more specifically related to their acquisition of Socialcast – offer new cloud based applications that can improve productivity (#5 above).  

VMware is leveraging their core business and competencies to extend into the near adjacent markets of enterprise cloud applications to accelerate growth.  

As VMware lead their customers on a journey to the cloud, having "proof-point" cloud applications will help customers see the value, productivity and ROI of their journey while positioning VMware for new growth. 

VMware's M&A strategy is grounded in their industry, company and market position while aspiring to new, adjacent growth opportunities.  From this perspective, I see why VMware is interested in the enterprise cloud collaboration space?  

We should expect to see additional moves and investments by VMware as they pursue their own journey from infrastructure virtualization to cloud applications.

Comments

  1. I wonder if this is (A) packaged apps to the cloud; (b) Proprietary apps to the cloud (3) New application metaphor’s story?
    For VMW to go from Infrastructure to Apps is a fundamentally different organisational challenge (IMHO), and Cisco is showing how hard this is to do, when your center of gravity is so heavily on the infrastructure layer;
    Does Infrastructure layer add any advantages / path dependency advantages to the application layer that aren’t available through strategic alliances (i.e. should VMW not have partnered with Avaya for Communications capabilities?)
    Just a few thoughts.

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