VMware and its owner EMC confirmed it will merge several product divisions into a new entity focused on cloud computing and big data.
Rumors had been circling VMware for months about a plan to spin out its Cloud Foundry platform-as-a-service division, and it turns out the rumors were true. It's more than just Cloud Foundry, as the new venture will include VMware's Spring line of products for Java developers, its GemFire data management software, and its Cetas big data analytics division.
The new venture will also include EMC's own Greenplum, which focuses on big data, and Pivotal Labs, which provides software development services and tools. In all, 600 employees from VMware and 800 employees from EMC will move to the new entity.
It will be called the "Pivotal Initiative," in what must be one of the least catchy corporate titles ever. Ex-VMware CEO Paul Maritz, now chief strategy officer for EMC, will lead the whole thing. EMC and VMware said they're not ready to reveal what "specific operational structure" the big combo group will have, but did call the Pivotal Initiative a "virtual organization." That leads us to think it won't be structured as a separate company, although EMC and VMware said the resources will be "formally unite[d]" in some way by Q2 2013.
So what's the point of all this? The announcement said "We are experiencing a major change in the wide scale move to cloud computing, which includes both infrastructural transformation and transformation of how applications will be built and used based on cloud, mobility, and big data. There is a significant opportunity for both VMware and EMC to provide thought and technology leadership, not only at the infrastructure level, but across the rapidly growing and fast-moving application development and big data markets. Aligning these resources is the best way for the combined companies to leverage this transformational period, and drive more quickly towards the rising opportunities."
Most of the divisions in the Pivotal Initiative were originally companies acquired by EMC or VMware. Acquisition sprees tend to lead to corporate bloat, making it hard to manage all the new employees and divisions. Despite EMC's ownership of VMware, the two act like separate companies, perhaps making it even difficult to collaborate on common interests. It's thus not surprising to see similar divisions from EMC and VMware joined into one.
The change in structure may also help VMware focus on what it does best: virtualization. Actually, the word "virtualization" wasn't uttered at all in the announcement because these days VMware likes to call what it does the "software defined datacenter." That means making all the resources in data centers virtual and giving IT administrators newer, easier, and better ways to manage them all.
VMware is also facing a big threat from Microsoft's Hyper-V, so it's natural for the company to put most of its efforts toward staying ahead of its biggest rival in the server virtualization market.
The announcement today also emphasized the importance of maintaining a focus on end-user computing, which includes VMware's virtual desktop software as well as its products for end-users (such as the Zimbra e-mail and collaboration suite).
"The Pivotal Initiative will enable a new generation of workloads that can exploit the advancements VMware is driving in the datacenter," the EMC/VMware announcement said. "By realigning resources within the Pivotal Initiative, VMware can more fully focus resources on delivering the software defined datacenter, the de facto infrastructure at the heart of cloud computing, and on end-user computing–two areas where we see tremendous opportunity for growth."
Naturally, products from the Pivotal Initiative "will be optimized for the VMware vCloud Suite." That might give pause to EMC's rivals in the storage business. But even after nearly a decade of EMC ownership, VMware has remained fairly neutral in terms of what storage systems can work with its virtualization software.
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