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VMware eats Socialcast for collabware

Munches way up the stack

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Server and desktop virtualization juggernaut VMware continues to build out a stack of applications for the cloudy era. It has now snapped up Socialcast, a maker of enterprise-grade social networking tools, for an undisclosed sum.

If you think you might have created what could become the preferred collaboration tool to plug into VMware's Horizon App Manager , think again and get in line behind VMware itself. And ditto for just about any other application if this is a beginning of a new trend. With ex-Microsoftie Paul Maritz at the president and CEO helm of VMware, you would expect the company to want to control the software stack from the hypervisor on up and offer an integrated set of tools that nonetheless allow other companies to play atop the infrastructure layer.

On the apps front, VMware ate email and calendaring software maker Zimbra in January 2010, and munched a maker of cloudy presentationware called SlideRocket a month ago. And now Socialcast.

And if you have an application that can run inside of a virtual machine and that has a Web 3.0 feel to it, you might want to gussie it up and trot it up and down Hillview Avenue in Palo Alto.

Socialcast was founded in 2005 by Tim Young because the company believed that the way that company employees interact with each other and with partners as they do work was going to be a bit more real-time and collaborative than using phones, instant message, and email. Not that these are not elements of collaboration, mind you. But the eponymous Socialcast is designed to augment these tools and bridge the gaps between users who have access to ERP, CRM, and SCM applications – what Socialcast calls activity streams – so they can share information with "colleagues" – what Facebook calls "friends" – and make decisions more smoothly and quickly.

The basic version of Socialcast is free, and includes the activity streams functionality as well as a connector for Microsoft's Outlook email and collaboration client and an overlay for Microsoft's SharePoint 2007 and 2010 that "makes it social". The basic version also includes interfaces for iPhone and BlackBerry handhelds, and enterprise microblogging and custom streaming. The premium edition, which adds analytics for social interactions amongst colleagues, integration with LDAP directories, private messaging from within Socialcast, and security and compliance add-ons, costs $3 per user per month for companies with up to 1,000 employees.

The key middleware software that adds a social veneer atop boring old enterprise apps is called Reach. The full-on Enterprise Edition of Socialcast has custom pricing and a feature set that varies depending on the organization; it is aimed at companies with up to 200,000 employees and is used to graft social collaboration features onto existing applications and to give employers a means of hosting a company-wide, moderated town hall meeting.

The Socialcast software can be deployed on a virtualized inside the corporate firewall or purchased as an external service that links back into the corporate apps. According to a blog post by Young announcing the deal, 40 per cent of Socialcast's customers who were installing the software on premises inside their firewalls were doing so atop VMware's ESXi hypervisors. So the two companies knew each other from partnering. Perhaps more importantly, VMware actually uses Socialcast internally (as it did SlideRocket), and pulled a Victor Kiam. Socialcast counts Avaya, Humana, Nokia, Philips Electronics, and SAS as other marquee customers.

Now, VMware will be cross-selling and upselling Zimbra, SlideRocket, and Socialcast to its 250,000 customers worldwide.

Socialcast will be tucked up under VMware's Cloud Applications division, which has Brian Byun as its vice president and general manager. It is not clear what role Young will play at VMware, but he said in his blog that all of Socialcast's employees were making the jump to VMware and that the company's product roadmap was unchanged. VMware is kicking in some resources to pick up the development pace, in fact, with announcements due "in the coming months." Over time, the support team for the Socialcast tech team will be integrated with the existing VMware team, as has happened with all VMware acquisitions.

Socialcast took in $1m in Series A funding from True Ventures in April 2009, plus another $400,000 from angel investors. In March 2010, True Ventures and Menlo Ventures kicked in $8m in a Series B round. ®

The smart choice: opportunity from uncertainty

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