VMware, like most vendors, has regular events designed to showcase their new products and services, and VMware’s VMWorld 2021 event is such a showcase. The stories the company told this year are particularly important given that the separation of VMware and Dell is onrushing, and everyone (including Wall Street and VMware’s customers) are wondering how the firm will navigate the change. It’s always difficult to theme out an event like this, because there are usually announcements touching many different technologies, so trying to lay out main themes is important.
The first such “main theme” is the cloud, meaning specifically hybrid and multi-cloud. VMware has a very strong position in the data center, earned largely by its early leadership in virtual machines. The cloud has pretty clearly moved on to containers, and in any event, containers are much easier to deploy because they carry their application configuration information with them. VMware has an excellent container framework in Tanzu, one of if not the best in the industry, but it’s been dancing a bit with harmonizing container futures with VM antecedents.
What seems to be emerging now is fairly straightforward. If we assume that applications have to deploy in the cloud and data center, and that “the cloud” means two or more clouds (multi-cloud), then there is a strong argument that an enterprise with this sort of deployment model could well want to use VMs in both the data center and in all their public clouds, and then use Tanzu to host containerized applications and tools in those VMs. This is the Tanzu-on-vSphere That would create a unified container deployment environment across everything, based on Tanzu, and support vSphere VM applications as usual.
The positioning anchor for all of this seems to be application modernization (AppMod), which is smart because the concept includes the creation of cloud front-ends for legacy applications, not just the “moving to the cloud” model that I think is out of touch with current software evolution reality. Tanzu, as the company indicated in its conference, is the future of VMware, and that realization is perhaps the most critical point in their overall positioning. The company seems committed to shedding its relentless VM focus, and that’s essential if they’re to remain relevant.
My only concern with the Tanzu positioning is that there are a bewildering set of products cited, and it’s not easy to establish the role of each and their relationship to any specific mission. That’s particularly noticeable in networking, which VMware spreads across at least three of their major announcement topical areas. VMware’s NSX virtual networking strategy is perhaps the original offering in the space (they got the first version when they acquired Nicira, who was the first big player in the space), and I think it would have been smart for VMware to try to focus networking on NSX just as they’re trying to focus hosting on Tanzu.
VMware has been active in the telco vertical for years, but their presentation of their telco products lump them with SD-WAN in the “Edge” category. If you were to presume that “edge” means “edge hosting”, then it would be logical to say that Tanzu belongs there, and in fact the strongest possible positioning for VMware in the telco space would be based on Tanzu, with support from specialized telco offerings (VMware Telco Cloud Infrastructure and Telco Cloud Platform) and virtual networking (NSX and SD-WAN). They do claim to support the evolution from VNFs to CNFs, but their solution brief for telcos doesn’t mention Tanzu and thus doesn’t link in their main enterprise strategy, nor their edge computing.
At VMWorld, they announced the “Cloud Native Box”, a joint activity with partner Accenture. This is what the VMware blog said: “The Cloud Native Box is a market-ready solution that supports multiple use cases with unlimited potential for specific deployment models, from core to edge and private networks solutions, depending on the business demands of each company. As a pre-engineered solution it offers proven interoperability among radio components, open computing, leading edge VMware Telco Cloud Platform (TCP) and a plethora of multivendor network workloads, with unparalleled lifecycle management automation capabilities.” It seems pretty clear that Cloud Native Box is aimed at resolving the telco issues I just cited, but how it does that can’t be extracted from the VMware blog, so we’ll have to wait to assess what the announcement will mean.
From when VMware acquired Pivotal and their Cloud Foundry cloud-native development and deployment tools, there’s been a bit of a struggle to avoid having two persistent container/cloud strategies in parallel. The show indicates that VMware is making progress integrating Pivotal Cloud Foundry with Tanzu, and the challenge hasn’t been eased by the loosey-goosey definition of “cloud native” that’s emerged. Tanzu Application Services is how Cloud Foundry stuff is currently packaged, but many see the “Tanzu” name more as an implied direction than as an appropriate label for current progress in consolidating the two container frameworks.
The difficulty here is that Tanzu Application Services is really a cloud-native development and deployment environment, and Kubernetes is really container orchestration. There’s real value in the old Cloud Foundry stuff, beyond the installed base, and of course VMware wants to increase the customer/prospect value in the integration and not toss everything to the wolves. They’re not there yet, but they’re making progress.
I think that there are two factors that have limited VMware’s ability to promote its stuff effectively. One is the classic challenge of base-versus-new. VMware has a large enterprise installed base who obviously know VMware-speak, and retaining that base is very important, particularly to the sales force. Not only does that guide positioning decisions, it also influences product development, aiming it more on evolution (of the base, obviously) than on new adoption. That’s reasonable in the enterprise space because the base is large, but it doesn’t serve well in the telco world.
The second factor is a positioning conservatism that I think developed out of the Dell/VMware relationship. Obviously, the two companies need to be somewhat symbiotic, which means that they can’t position in a way that essentially makes them concept competitors. Now that there’s going to be a spin-out-or-off-or-whatever, VMware will have to stand on its own, but until then it’s important that neither company rocks the collective boat too much.
Any major business change creates challenges, and either major M&A or spin-outs are surely major business changes. Executives are always preoccupied with these shifts, and in the case of VMware, so are many critical employees. Some look forward to being independent, thinking they were constrained by Dell, which they were. Some fear it, concerned that Dell might shift its focus to a broader mix of platform software, at VMware’s expense, which they likely will. In short, nobody really knows how this is going to turn out, and what the best strategy for VMware will be for the future.
Whatever it is, it needs to address the issues I’ve cited above. In fact, it needs to address them more than ever, because optimizing the favorable implications of the spin-out and minimizing the risk of the negative starts with having a story that’s not just coherent and cohesive, but also exciting beyond the VMware base. Up to now, getting that story has proved problematic for VMware, and they can’t afford to let those past positioning difficulties contaminate their future.
