Original URL: http://www.theregister.co.uk/2013/11/04/vmware_vmworld_analysis/

Yellow-bellied journo dons black tie, sees flip side of VMWorld

Bish bash booth: Wrong event accreditation gives our man a glimpse into the future

By Trevor Pott

Posted in Virtualization, 4th November 2013 15:29 GMT

Sysadmin blog As I write this, VMworld San Francisco 2013 is two months behind me. I went, I saw, I schmoozed, and I came away from the event unsettled.

I had expected the event to be a glorification of VMware – a rich parade of the ecosystem that surrounds it and cheerleading by its users. What I found was anything but.

I entered the hallowed halls of my first VMworld as a newly minted vExpert. After a decade in this industry I had achieved a title of rarity, and by Jove, I was ready to indulge in the community that had accepted me.

I overbooked myself on parties and burned myself out, but my obsession with "the community" ultimately served to give me a different perspective from those others who attended as "press" or "analyst".

Fashionable neckwear

When I showed up to register I went to the wrong building – and this turned out to be a stroke of luck. The registration desk handed me a black lanyard for my conference ID; while I thought nothing of it at the time, the black lanyard identified me as a regular attendee. This was to prove critical to my outlook of the event.

Had I gone to the right building I would have been given a yellow lanyard which would have told vendors I was press. Red lanyards were for analysts only. I did eventually get my "proper" yellow lanyard, but only after having roamed the exhibition hall for a day sporting my "regular attendee" neckwear.

When I first got my yellow lanyard I was with a group of other "yellow-bellied" journalists. The acquisition sparked a conversation about the neckwear and a general lamentation that those identified as press were treated by vendors as though they had a communicable disease. Analysts claimed to have it worse and I became instantly curious if this was true.

Sure enough, a brief experiment with a yellow lanyard saw those manning the booths turn pale and fetch an adult. A trained marketer or PR person was trotted out and I would ultimately learn nothing of substance from the vendor in question.

Put the black lanyard back on, however, and I got the sales pitch. I was able to ask difficult technical questions and engage in long debates. Truly, two different worlds were being presented here.

Wake not Goliath

With my press pass, everything was washed-out platitudes. A few new features here, a version tick there. The words used changed, but the information disbursed was predictable and flat. I learned the same details that were available to learn when I browsed the company's website while waiting for the PR person to become available.

As an attendee, however, a startling thing happened: over half of the booths I visited opened with some variant of "we support more than just VMware". I was rather taken aback by this, but it occurred so often that it's obvious these companies feel there's strong demand here.

"We support Hyper-V/KVM/Openstack," they said, and: "We'll free you from vendor lock-in." Another added: "We make moving between VMware and public cloud providers easy." After some consultation with other press and analysts it became clear I was not going mad: the black lanyard causes the bodies manning the booths to sing a different song.

I have confronted several vendors about this outright. The rationale behind the difference is simple: they do not want to be seen in the press pushing support for VMware's competitors at VMware's own conference.

Tame journos known to the various companies would be given the full spiel; but only those they could trust not to embarrass them. The vendors needed VMware and there was no way they could afford to attract the virtualisation Goliath's ire.

Interweaving stories

I've spent the past two months chasing this around. Why the push towards supporting other vendors? The answer, invariably, has been customer demand.

Several companies refused to talk to me unless it was strictly off the record. They are viewed as key enablers of virtualisation and/or cloud adoption and their support of alternate vendors is often all that stands in the way of hundreds of companies moving to heterogeneous environments, or even away from VMware altogether.

How they craft the message around this new support is important to their long-term business relationships and they certainly don't want some journalist screwing it up. I get this – all of it makes perfect sense – but I was still curious as to what the rationale was that the customers had for demanding alternate vendor support.

CommVault was the first vendor to really clear things up. It was the money, stupid. Very few enterprises that CommVault works with were prepared to put their production environments on Hyper-V. By the same token, an equally small number of companies seemed to want to pay VMware's rates for their disaster recovery sites.

CommVault said it was seeing companies turn to it in order to enable production VMware environments be backed up to far cheaper Hyper-V environments: a service that CommVault is only too happy to deliver.

Hey, you, get offa my cloud

Cloud service providers (CSPs) are emphatically not happy about vCHS and VMware's public cloud ambitions. They had been making good money selling Virtual Private Clouds (VPCs) based on VMware's technology and direct competition from VMware is entirely unwelcome.

CSPs adamantly do not want to be beholden to VMware. They want a diversity of vendors available so that they can play each against the other to get better prices. Critically, they want the ability to ditch a vendor entirely if that vendor refuses to play ball.

In response there are hordes of companies rushing in to fill the gaps. CSPs are the new enterprise: they buy in bulk and they have complicated – often bespoke – management requirements that need to "just work". That means an opportunity for high-margin cross-platform management software, something nearly half the VMware showfloor was eager to cash in on.

It's a mite dusty at the coalface

At the end of the tunnel lie the end businesses themselves. Far from the world of CSPs or enterprises large enough to actually have disaster-recovery sites lies the "other 80 per cent" of businesses. These companies are no more eager to be beholden to a single vendor than their bigger brothers. Startups and established industry behemoths like Dell and HP alike report trebling demand for hybrid cloud computing.

The commercial midmarket and even SMBs want the ability to move their VMs from one hypervisor to the next – and from local servers to the cloud – with a minimum of fuss and muss. More to the point, they don't want to be subject to lock-in.

There is a weariness that overcomes both sysadmins and business owners when I bring this up for discussion. Company names like Oracle, Cisco, EMC and Microsoft are spoken of with an exhalation of breath and a haunted look that speak volumes. VMware has joined this elite troupe of vendors.

Decades of various forms of lock-in have served as a continuous negative reinforcement: these people are willing to pay good money today to obtain the tools necessary to break the cycle. A little money now, they argue, is better than waiting for a vendor to simply turn the knobs.

The move away from all-VMware environments is simple: companies want control over their vendor, not the other way around.

Bias and viewpoints

C suite execs were unsurprisingly on board with spending less money

Given the number of anti-megavendor articles I've written in the past, it would be very easy to argue that I am simply seeing what I want to see here, or that I am blowing a small number of malcontents completely out of proportion. It is for this very reason that I didn't rush out the day after VMworld was over with my take on the goings-on I had witnessed.

While at VMworld I discussed this topic at length with innumerable people. I was candid about my findings and sought reactions from VMware employees, fellow vExperts, CxOs and big name analysts alike.

Those who worked for VMware or were enterprise-focused analysts or vExperts working closely with Fortune 500 companies claimed flat out that I was full of shit. They didn't see this in their day-to-day lives, and they quite openly felt that only enterprises – or possibly government IT – mattered.

Quite literally everyone else, however, seemed completely unsurprised by my findings. C suite execs universally agreed with my sentiments. Many of the vExperts affiliated with CSPs, startups, SMBs, or the commercial midmarket nodded along and couldn't wait to jump in and find out whom I'd talked to that could help them achieve these goals.

The more mixed reactions came from community organisations like vBrownBag. Here, membership is diverse; enterprise nerds meet government geeks and everyone mingles with the hoi polloi occupying the other tiers. Over the past two months debates have been fierce with no real winning viewpoints and a clear dichotomy of experience.

In two months of poking and prodding I have been unable to get a true sense of the scale of the demand for heterogeneous or non-VMware environments. Hard metrics are almost impossible to find.

It is clear, however, that the VMware community is not as unified behind VMware as they were only a few years ago. Those startups were definitely on to something; they've seen a trend few even want to acknowledge exists.

Brain drain, licensing and sales growth

VMware saw licence numbers grow during the last quarter. Publicly, at least, it won't acknowledge any of what I've described above. This quarter's demand for VMware products is strong and this is the barometer by which it judges the success of its choices.

What is more telling is talking to those who no longer work there. It is an open secret that VMware has been haemorrhaging AAA brains since Diane Greene was ousted. Some deny it vehemently, however, VMware's brain drain has been going on for long enough that it is making waves in the wider community.

The startups of Silicon Valley are peopled by those who left VMware; it is something of a running joke that if you want to find a VMware executive you need look no further than Craigslist. Of those I've managed to track down, the overwhelming rationale behind their departure was a change in corporate culture.

VMware, it is said, had "lost its startup feel". "Who you know" had come to matter more than results. Red tape chokes innovation and bureaucracy impedes change.

Almost all of the Virtzilla expats I've talked to agree with my findings at VMworld: there is a growing unease among customers. For those who are now running their own startups it's often why they left: a chance to make giant sacks of filthy lucre providing what VMware itself had become incapable of offering.

VMware employees deny that customers are looking for an out. VMware executives deny they have a brain drain problem. VMware representatives get very angry with me when I say that the hypervisor is now a commodity. They immediately launch into an obviously well-rehearsed diatribe about how deeply wrong that statement is.

I can't help but feel the entire company is living in denial.

The new Microsoft?

Putting all the pieces together I see in VMware a company that has not learned the lessons Microsoft is so bitterly living today: desperately protecting your current revenue stream at all costs leads to user disenfranchisement. As Steve Jobs once said: "If you don't cannibalize yourself, someone else will."

Is VMware institutionally capable of learning this lesson?

The magic is gone. In this hack's opinion, VMware is far too heavily invested in the status quo to be nimble, too bureaucratic to encourage internal novelty. This is sad, but it is by no means dire.

VMware as a company will continue. It may even learn once more to innovate unique products instead of duplicating the efforts of their ecosystem partners. It is enormous, has a massively loyal customer base, huge revenues and a diverse portfolio of offerings.

Like Cisco, EMC, Microsoft and Oracle, VMware sells peace of mind and the steady security of slow change. But if I were to sum up VMworld 2013 in a single phrase it would be thus: "We have entered a post-VMware world."

As with other sectors of IT which have each become dominated by an enterprise behemoth, the future of innovation in virtualisation will be defined as much by how products enable you to move beyond VMware as the feature-sets themselves. For better or worse, VMware is one of the Big Boys now. ®