It appears that VMware has been on quite the acquisition kick lately, first with the $1.3 billion acquisition of its Palo Alto neighbor Nicira in 2012, and now with its largest acquisition in company history: the $1.54 billion purchase of mobile management and security firm AirWatch. The AirWatch acquisition is aimed at tightening companies’ security and peace of mind, particularly with regard to the growing use of mobile devices for work, referred to as “bring your own device” (BYOD).
This is a good acquisition for VMware that will help to secure its end-user computing platform portfolio. While it continues to push to provide services and features to the ever-growing mobile workforce market, at the same time it will be able to promote its ability to secure mobile devices and corporate data. This acquisition also confirms that VMware believes mobile devices and their management will continue to grow and expand in the workplace. (According to some estimates, mobile device use will soon outpace standard desktop computer utilization in the workplace.)
With the completion of both of these billion-dollar acquisitions, VMware can now offer to businesses server, desktop, network, and mobile solutions, all of which can be backed by storage products presented by VMware’s parent company, EMC. This, in my opinion, will expand VMware’s presence and lead in the private cloud space as well as add features to its public cloud offering. Nevertheless, while I envision VMware’s public offering growing with the release of new products and services in what I view as continuing competition with Microsoft’s Azure technology, I still believe that OpenStack will remain the most prevalent force in the public cloud arena, where it is embraced by companies like Amazon, Google, Dell, and Red Hat. At the same time, I believe that VMware continues to position itself as the future of the private cloud. Recently, it announced that preliminary fourth-quarter earnings have surpassed its previous forecast and that fourth-quarter revenues are predicted to be around $1.48 billion, a gain of fifteen percent over the same quarter last year. This further indicates to me that it has chosen a solid path forward.
In closing, with the surging popularity of smartphones and tablets in everyday life, the extent to which they are are finding their way into corporate datacenters is forcing companies to adapt. Businesses must find a way to utilize and manage these devices or face the reality of losing control of company data. VMware needed AirWatch in order to compete in the mobile device management software space with companies like MobileIron, Citrix Systems Inc., SAP AG, and Good Technology, in preparation for what we could call a “post-PC world.” In this world, mobile devices will sharply outnumber standard desktops in corporate environments. I am glad to see that VMware has an understanding of what this future will be like and of how to prepare to secure these devices as we move into this brave new post-PC world.
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