VMware Becomes More Laser-Focused, Selling Two Business Units


Some might say that the carve-up has begun, now that the Dell/EMC merger has been finalized. VMware has divested itself of two new business units: namely, the Business Enterprise and IT Benchmarking units, which it bought in 2011 when it acquired Digital Fuel. Remember, this was during VMware’s acquisition phase under former CEO Paul Maritz, during which it acquired companies including Shavlik, SpringSource, Socialcast, and Zimbra, amongst several others.

VMware divests itself of two more business units

To add a little historical context, these were purchased during the time when Paul Maritz was trying to turn VMware into another Microsoft, with fingers in all pies, and attempting to become a full stack provider. Paul was a man of vision who firmly believed that for VMware to survive the cataclysm that is “invisible infrastucture,” the application needed to be paramount. This is most likely true, but the method that is currently in favor in the Cloud-Native Apps division, run by Kit Colbert, is a much better method for making this journey.

Since Maritz moved out of the corner office and Gelsinger moved in, the vast majority of these purchases have been moved on, either out or sideways. Zimbra was sold on at a loss to Telligent in 2013, Shavlik was sold to LANDESK, and SpringSource was spun out into a joint venture with GE called Pivotal Software, incidentally led by Maritz for a number of years after his VMware exit.

The Business Enterprise and IT Benchmarking units in VMware were additional plums in the apple barrel purchases that did not jell with the current line of thinking. VMware has been struggling to generate the value from them that the original purchase promised. EMC and VMware had already identified Skyview Capital as a potential purchaser for these units prior to the merger.

Skyview plans to form a new company called Digital Fuel SV LLC to move the product going forward. Incidentally, as seems to the norm for these sorts of divestitures now, VMware will retain a minority stake in the new company (think HPE with its sale of its Professional Services division to CSC).

VMware has been making a distinct effort to return to basics and focus on management of infrastructure, be it cloud infrastructure made up of virtual machines or containers (vSphere, vRAC, Photon, VIC, VIO), Networks (NSX), or storage (VMFS and VSAN). This focus will be more prevalent now that VMware is part of the behemoth that is Dell Technologies. Dell will be rationalizing the constituent parts over the next financial year or so. Divisions that are deemed non-core will be moved out or sidelined in an attempt to lower the overall debt ratio of the business and streamline its go-to-market strategy for its combined salesforce.

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Tom Howarth
Tom Howarth is an IT Veteran of over 20 years experience and is the owner of PlanetVM.Net Ltd, Tom is a moderator of the VMware Communities forum. He is a contributing author on VMware vSphere(TM) and Virtual Infrastructure Security: Securing ESX and the Virtual Environment, and the forthcoming vSphere a Quick Guide. He regularly does huge virtualization projects for enterprises in the U.K. and elsewhere in EMEA. Tom was Elected vExpert for 2009 and each subsequent year thereafter.
Tom Howarth

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