Welcome!

Containers Expo Blog Authors: Mehdi Daoudi, Elizabeth White, John Rauser, Pat Romanski, Liz McMillan

Related Topics: Containers Expo Blog, Java IoT, Microservices Expo, Microsoft Cloud, Agile Computing, @CloudExpo

Containers Expo Blog: Blog Feed Post

The Changing Feel of VMware PEX

I've had the privilege to attend many VMware events in the past 4-5 years

In my 20 years in the technology industry, I've found that there are three types of product/service strategy discussions that companies (vendors) have:

  1. "Our new product/tool will change the world." - Occasionally this happens, but more often that not it's just a feature that could be implemented on any existing platform.
  2. "Our new product delivers immediate value to customers and solves an existing (widespread) problem". Companies will typically pay money to solve problems, especially if it saves them money or unlocks a new market opportunity. Typically this creates a new market for the vendor. VMware ESX did this for many years. Consolidate servers, save money.
  3. "Our value is no longer distinct, so let's embed it into a suite/bundle with other things, and hopefully take a larger piece of the pie (customer's budget) that is currently allocated to somewhere else."

I've had the privilege to attend many VMware events in the past 4-5 years (PEX, VMworld, VMUG, etc.), and the theme of those events always seemed to fall into the #1 or #2 buckets. It's what created such a passionate following for the products and the company. It created a very unique, "wow, if I do this, then something better happens" moment for many companies.

But this year's event was different. It had a #3 feel to it. Many of the themes that had been critical to VMware (VDI, virtualizing Mission-Critical Applications, etc.) were now buried within "suites".

Overall, the value proposition to the customer was no longer obvious. Most notably by the VMware people that were presenting solutions like "vCloud Suite". The theme had shifted from "buy for value" to "buy for potential value, if we can unlock it".

Here's an example. I sat through a "How to sell vCloud Suite" presentation, given by the Director of Product Management for vCloud (apologies, I didn't catch the presenter's name). The audience was VMware partners, primarily their go-to-market partners (VARs/SIs). After introducing the pieces of the vCloud Suite, his pitch went something like this (paraphrased):

  1. Great job selling vSphere. 30-40% of most applications are virtualized. Sometimes more.
  2. We're not going to call it "Cloud" anymore. It's now called "Software-Defined Data Center" (SDDC). vCloud used to be the answer to "how to get to Cloud?". vCloud is now the answer to "how to get to SDDC?".
  3. Getting to high-levels of virtualization was a CAPEX story. Inefficient hardware. Save customers hard costs. Getting to SDDC is an OPEX story. Inefficient people and processes. Save customers unknown/soft costs.
  4. IT still isn't very efficient, mostly because storage and networking aren't virtualized and controlled (via VMware) like server virtualization. Get your customers to virtualize those things. (NOTE: How to do that is not covered in this presentation).
  5. Overall, IT still isn't operating very efficiently. Sell them vCOPs to figure out where there are more inefficiencies, like stranded VMs, poorly provisioned storage, poorly configured networks, etc.

The product manager then continued for another 30 minutes talking about how to sell the rest of the vCloud components, but he never did get around to a clear value proposition for the customer. There was some discussion about the need to run IT-as-a-Service, but in essence it boiled down to "it's a big problem, so here's a big software suite to sell them". A classic example of #3 strategy.

Another example of where VMware seemed to have disconnected value-proposition was the announcement of the VMware Cloud Credits program. It was touted as a great way to help customers budget for using public cloud services. On the surface, it appeared to potentially be helping the 200+ vCloud Service Providers, that Pat Gelsinger was quoted as saying, "What is really amazing -- we haven't done anything to earn that business". But when I dug deeper with their Product Management team, I uncovered some interesting details that weren't part of the announcement.

  • Only available to existing vCloud-Powered SP. VMware decides who gets in the program; SP can't just opt-in.
  • VMware choosing which vCloud-SPs are allowed to participate based on geography, verticals, unique offerings.
  • The credits are sold independent of any vCloud SP. They basically operate like a gift-card.
  • vCloud-SP gets no visibility into which customers have bought credits, or the Channel-Partners (VAR/SI) that sold credits. No opportunities to market their differentiation directly to end-customers via the program.
  • vCloud-SP only gets visibility into end-customers once they are engaged directly with them, and then only Cloud credit-levels on that specific customer.
  • Credits expire in 12 months. End-customers can extend credit lifecycle if already engaged with a specific SP.
  • Unused credits can not be sold to other customers. Treated as a "license-agreement". No resale market will exist.
  • Unused credits can not be returned to Partner or VMware for credit/money.
  • vCloud-SP only gets revenue if credits are used.
  • vCloud-SP must translate their existing services/service-level pricing into Cloud Credits (VMware creating some application-centric calculators).

So it's a potential revenue source for both the Channel partner and VMware, but the vCloud SPs are indirectly left out of the supply-demand loop. I can understand that VMware doesn't want their end-customers to get bombarded with marketing from the vCloud SPs because of this program, but that is already happening today. This seems somewhat unusual if the program is actually attempting to drive demand for those vCloud-based SPs.

Those are just a couple of example of the changes that I experienced at VMware Partner Exchange (PEX) this year. None of them are an indictment of VMware failings, but they do appear to be a strong indication that VMware's strategies are moving more and more towards #3. Given the size of their ecosystem and installed base, it will be interesting to see how they adapt to these shifts.

Read the original blog entry...

More Stories By Brian Gracely

A 20 year technology veteran, Brian Gracely is VP of product management at Virtustream. He holds a CCIE #3077 and an MBA from Wake Forest University.

Throughout his career Brian has led Cisco, NetApp, EMC and Virtustream into emerging markets and through technology transitions. An active participant in the virtualization and cloud computing communities, his industry viewpoints and writing can also be found on Twitter @bgracely, on his blog Clouds of Change and his podcast The Cloudcast (.net). He is a VMware vExpert and was named a "Top 100" Cloud Computing blogger by Cloud Computing Journal.

@ThingsExpo Stories
SYS-CON Events announced today that CA Technologies has been named "Platinum Sponsor" of SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CA Technologies helps customers succeed in a future where every business - from apparel to energy - is being rewritten by software. From planning to development to management to security, CA creates software that fuels transformation for companies in the applic...
SYS-CON Events announced today that IBM has been named “Diamond Sponsor” of SYS-CON's 21st Cloud Expo, which will take place on October 31 through November 2nd 2017 at the Santa Clara Convention Center in Santa Clara, California.
In his session at Cloud Expo, Alan Winters, an entertainment executive/TV producer turned serial entrepreneur, presented a success story of an entrepreneur who has both suffered through and benefited from offshore development across multiple businesses: The smart choice, or how to select the right offshore development partner Warning signs, or how to minimize chances of making the wrong choice Collaboration, or how to establish the most effective work processes Budget control, or how to ma...
SYS-CON Events announced today that Cloud Academy named "Bronze Sponsor" of 21st International Cloud Expo which will take place October 31 - November 2, 2017 at the Santa Clara Convention Center in Santa Clara, CA. Cloud Academy is the industry’s most innovative, vendor-neutral cloud technology training platform. Cloud Academy provides continuous learning solutions for individuals and enterprise teams for Amazon Web Services, Microsoft Azure, Google Cloud Platform, and the most popular cloud com...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
We build IoT infrastructure products - when you have to integrate different devices, different systems and cloud you have to build an application to do that but we eliminate the need to build an application. Our products can integrate any device, any system, any cloud regardless of protocol," explained Peter Jung, Chief Product Officer at Pulzze Systems, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA
"When we talk about cloud without compromise what we're talking about is that when people think about 'I need the flexibility of the cloud' - it's the ability to create applications and run them in a cloud environment that's far more flexible,” explained Matthew Finnie, CTO of Interoute, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
In his session at @ThingsExpo, Eric Lachapelle, CEO of the Professional Evaluation and Certification Board (PECB), provided an overview of various initiatives to certify the security of connected devices and future trends in ensuring public trust of IoT. Eric Lachapelle is the Chief Executive Officer of the Professional Evaluation and Certification Board (PECB), an international certification body. His role is to help companies and individuals to achieve professional, accredited and worldwide re...
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assista...
When growing capacity and power in the data center, the architectural trade-offs between server scale-up vs. scale-out continue to be debated. Both approaches are valid: scale-out adds multiple, smaller servers running in a distributed computing model, while scale-up adds fewer, more powerful servers that are capable of running larger workloads. It’s worth noting that there are additional, unique advantages that scale-up architectures offer. One big advantage is large memory and compute capacity...
Internet of @ThingsExpo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 21st Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devic...
IoT solutions exploit operational data generated by Internet-connected smart “things” for the purpose of gaining operational insight and producing “better outcomes” (for example, create new business models, eliminate unscheduled maintenance, etc.). The explosive proliferation of IoT solutions will result in an exponential growth in the volume of IoT data, precipitating significant Information Governance issues: who owns the IoT data, what are the rights/duties of IoT solutions adopters towards t...
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, discussed some of the security challenges of the IoT infrastructure and related how these aspects impact Smart Living. The material was delivered interac...
No hype cycles or predictions of zillions of things here. IoT is big. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, Associate Partner at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He discussed the evaluation of communication standards and IoT messaging protocols, data analytics considerations, edge-to-cloud tec...
The Internet giants are fully embracing AI. All the services they offer to their customers are aimed at drawing a map of the world with the data they get. The AIs from these companies are used to build disruptive approaches that cannot be used by established enterprises, which are threatened by these disruptions. However, most leaders underestimate the effect this will have on their businesses. In his session at 21st Cloud Expo, Rene Buest, Director Market Research & Technology Evangelism at Ara...
Artificial intelligence, machine learning, neural networks. We’re in the midst of a wave of excitement around AI such as hasn’t been seen for a few decades. But those previous periods of inflated expectations led to troughs of disappointment. Will this time be different? Most likely. Applications of AI such as predictive analytics are already decreasing costs and improving reliability of industrial machinery. Furthermore, the funding and research going into AI now comes from a wide range of com...
SYS-CON Events announced today that Enzu will exhibit at SYS-CON's 21st Int\ernational Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to focus on the core of their ...
SYS-CON Events announced today that MobiDev, a client-oriented software development company, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software company that develops and delivers turn-key mobile apps, websites, web services, and complex software systems for startups and enterprises. Since 2009 it has grown from a small group of passionate engineers and business...
SYS-CON Events announced today that GrapeUp, the leading provider of rapid product development at the speed of business, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market acr...
SYS-CON Events announced today that Ayehu will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on October 31 - November 2, 2017 at the Santa Clara Convention Center in Santa Clara California. Ayehu provides IT Process Automation & Orchestration solutions for IT and Security professionals to identify and resolve critical incidents and enable rapid containment, eradication, and recovery from cyber security breaches. Ayehu provides customers greater control over IT infras...