VMware has been stuck in a rut lately but now appears to have escaped by posting a strong first quarter for 2018.
The outfit has made $1.74 billion which was nine percent more than Q1 2016, and posting a GAAP net income of $232 million, up from Q1 2016’s $161 million.
VMware has adopted Dell’s financial calendar and therefore counted January 2017 as a discrete “stub”. The Q1 2018 numbers refer to February to April, while the 2016 numbers cover January to March of that year. The company had revenue of $496 million in January, a reflection of seasonal slowness.
The company also reported that R&D costs are up 18.2 percent and billings were $1.35 billion rather than an expected $1.6 billion.
Investors remain that worried that VMware is not out of the woods yet. However, the company earnings call reveal increased guidance for both the second quarter and FY 18. It now expects $1.84-$1.89 billion next quarter, and $7.61 billion for the full year.
VMware has written a cheque for Apteligent, a provider of mobile application performance and monitoring technology, and plans to shove it under the bonnet of VMware’s cloud and end user management products.
Apteligent arrives with shedloads of intellectual property related to how applications operate in mobile environments which VMware wants to use to make manageability across the cloud and end-user computing more intelligent.
Apteligent automatically captures and interprets application data to provide user insights and information to help provide mobile business performance. It takes real-time event data from user flows in an application, tracks key metrics, and uses mobile ecosystem data points to help customers improve the applications.
Last year VMware acquired Arkin, a startup developer of software that lets organisations keep track of networking traffic flows and security issues in virtualised and physical environments. That technology became VMware’s vRealize network Insight, or vRN
VMware has ended its OEM relationship with the security start-up Tanium in what is turning out as an annus horribilis for the security outfit.
Both VMware and Tanium confirmed the end of the OEM relationship with their various spinners saying that the decision was mutual.
The ending appears due to conflicts related to the Tanium OEM deal payment structure and to challenges in supporting Tanium’s tricky tech. Tanium has removed VMware from its list of technology partners on its website.
VMware said the two will continue to work together in some capacity to service joint customers.
The couple have been together since June 2016 and VMware created a new offering called VMware TrustPoint. It was supposed to allow an IT administrator to monitor, discover and manage threats and vulnerabilities, and to manage end point updates and OS migrations.
It was targeted at securing endpoints and easing Windows 10 desktop migration projects.
During the honeymoon period VMware Executive Vice President and General Manager of End User Computing Sanjay Poonen praised Tanium’s “highly innovative” approach to end point management and security.
Tanium’s proprietary peer-to-peer technology lets organisations continually scan all endpoints in their global networks, finding and fixing security vulnerabilities and identifying and controlling unmanaged devices.
In fact at one point the companies were close to merging. Acquisition talks took place in late 2015. Sources said at the time that Tanium’s high valuation, combined with Dell’s $67 billion bid in October to acquire VMware parent EMC, prevented the acquisition talks from progressing further.
Tanium has had a pretty terrible year. The outfit has been hit by multiple reports of a troubled company culture. The company was slammed for exposing a client’s private network information without permission in demos. Tanium CEO Orion Hindawi has apologized for both issues in a blog post.
The outfit has seen multiple top-level executive flee in recent months including the sudden exit of CFO and COO Eric Brown in March. Tanium has replaced Brown with former Dreamworks executive Fazal Merchant. Tanium has also seen the departures of its CMO and head of sales last year, and multiple VP-level channel executives.
Tanium had been considering an initial public offering.
In what is being seen as good news for VMware’s partners, the outfit has decided to buy Wavefront.
For those who came in late Wavefront, makes multi-cloud monitoring and management technology on the application level.
This is seen as good news for VMware partners who can now offer a live-streaming look at all of the data from the cloud and from the applications in the cloud including user behaviour.
It can also handle a multi-cloud strategy to turn VMware into a cross-cloud management platform.
It should reassure customers about the risk of their cloud based strategy. VMware is effectively claiming to be able to monitor that entire cloud application delivery experience right down to the end-user behaviour.
VMware revealed its plan to acquire the Palo Alto, Calif.-based startup Wednesday. Wavefront, named to CRN’s 10 Coolest Big Data Startups of 2016, develops a cloud-hosted, real-time analytics platform that monitors and manages cloud applications. It provides monitoring to optimise clouds and modern applications by delivering insight using millions of data points per second in real time.
Wavefront’s metric monitoring for applications complements VMware’s vRealize Operations platform for monitoring, troubleshooting and capacity planning across virtual environments, according to VMware. Wavefront also will complement VMware’s vRealize Network Insight and vRealize Log Insight products.
Ajay Singh, senior vice president and general manager of VMware’s Cloud Management Business Unit claimed that VMware set the standard for monitoring virtual environments with VMware vRealize Operations platform, and will set the standard for cross-cloud and modern application monitoring with Wavefront.
The word on the street has been that Pat “Kicking” Gelsinger is about to clean out his desk at VMware once the EMC/Dell merger concludes.
However Gelsinger apparently has his feet nailed underneath the desk to prevent easy removal, even if it has curtailed his kicking antics for now.
Speaking at the Jefferies Technology Conference Gelsinger told the assorted Jeffs that he denied that he was off to pastures new: “I categorically deny it, EMC categorically denies it, and Dell categorically denies it, so there is absolutely no merit or substance to the rumour whatsoever. My intention is to stay here and Michael Dell’s intention is that I stay here.”
Gelsinger met with Dell earlier this week at VMware’s internal R&D conference when his PR team sent him a text about the report of his departure. Gelsinger said he showed his phone to Dell, asked him “Is there something I don’t know and we got a laugh about it”.
Of course Dell could have been laughing in the same way that Game of Thrones villains do before they stick a knife into someone’s liver, but we don’t think Pat is due to go to any weddings.
Gelsinger added that recent exits from VMware were a sign of execs reaching new stages in their lives, rather than tiring of VMware. Some have teenaged kids. Others have closed 100 quarters in a row at public companies and want new horizons. Gelsinger also said VMware’s replacement executives were “experienced and hungry” so clearly they have not found the VMware canteen yet.
VMware has been having a few problems with its bottom line lately and it seems it is taking it out on its NSX prices.
The outfit has cut the product’s feature list to offer cheaper versions which do not cost as much as the full product but it has also jacked up the price of the top version of the product.
The more expensive product is aimed at companies wanting to create software defined data centres, which is a lucrative area. NSX slips networking and security into the hypervisor and could be a good product for resellers to sell.
Now however it is getting a pricy option. A full NSX license cost US$6,000 per CPU socket although the cut down packages might be a little more viable. NSX Enterprise costs at $6,995 per CPU socket; Standard will cost $1,995 per CPU socket; and Advanced will cost $4,495 per CPU socket.
Advanced and Enterprise also get more license options. All three are available on a perpetual license; Advanced can also be licensed on a per-user basis, and Enterprise adds a per-VM licensing option.
Tin box shifter Michael Dell is warning investors that the $14 billion drop in the market capitalisation of VMware is playing havoc with his attempt to get cash for EMC.
A Dell spokesman said the total value of the blockbuster acquisition has dropped by about $10 billion from its original $67 billion, to $57 billion.
In an SEC filing, Dell noted that “the market value” of the VMware tracking stock has “declined, thereby reducing the implied value of the stock portion of the merger consideration”.
On October 9, the last business day before the Dell-EMC announcement was made, VMware, 80 percent of which is owned by EMC, had a market capitalisation of $33.2 billion and a stock price of $78.65 a share. Now, its market cap is about $19.2 billion, and its stock price is hovering around $45.54.
A Dell spokesman said the EMC acquisition price of $24.05 per share was “locked, that doesn’t move, but because VMware has moved down, the value of the portion of the merger consideration linked with the tracker is going to be in that range of decline”. Whatever that means.
Avaya has started a new midmarket programme for a ‘limited number’ of Avaya Connect channel partners.
The imaginatively titled Avaya Midmarket Select Programme enable partners to offer Select Engagement Packages of services and products specifically aimed at the midmarket.
Avaya has been worried that the midmarket has been tricky – particularly when it comes to Unified Communications. Fully integrated solutions, which rely hardware and software sit at one end of the market while cloud only packages are parked at the other with little for the middle ground.
Avaya says that it already has more than a dozen channel partners already signed up in the US, Canada and Europe, and has now opened the programme to others. Partners must meet requirements for training, expertise, business plans and growth targets.
The company said that the programme will dramatically reduce the total cost of ownership (TCO) for purchasing, deploying and supporting midmarket solutions.
The packages offers a complete stack of enterprise-class solutions such as unified communications, contact centre, video, networking, mobility, and professional services.
Avaya’s roots are in proprietary hardware, but it appears to be successfully using commodity hardware and standards-based software. It recently launched it’s own software-defined networking architecture earlier this year, rivalling solutions from both Cisco and VMware.
A furious EMC president of global sales Bill Scannell told his sales teams to stop making stuff up about the company’s coming merger with Dell.
According to Channelnomics Scannell told his staff not to “veer from the script” after the $67 billion acquisition by Dell was announced earlier this month. He slammed some of his staff for saying the wrong thing to customers.
He said that he had seen a couple of things happening in the field where people are veering from the script and kind of making things up.
“That’s not healthy, that’s not going to allow us to make this a painless and very successful merger… Understand what you can and can’t say now prior to the closing, realising this could be another six to nine months before we get the regulatory approvals and the shareholders’ sign-off to do this merger.”
Scannell told his staff to focus on quarterly business and exceeding customers’ expectations. They needed to sure they understand what we’ve said publicly about this acquisition and that it is all is going to be great.
If the deal goes ahead, EMC will go private but VMware – in which it owns an 80 per cent stake – will remain a publicly listed company. This means that EMC will not have to worry about shipping products at the end of the quarter to make the quarterly revenue numbers.
This is going to have huge impact on savings from inventory with EMC, Scannell said.
VMware wants to have 500 partners for its AirWatch channel.
AirWatch is the mobile management and security firm VMware bought for $1.55 billion. It had only let partners get their hands on it in the second half of last year.
This had miffed some of VMware’s resellers who had muttered to the company that they would like to sell it.
While it is unclear why this was the case, VMware is more than making up for it John Churchhouse, VMware’s EMEA SMB director, said he is targeting heavy recruitment of resellers for AirWatch.
At the moment VMWare has 120 partners focused around mobility solutions, and it wants to get it to 500 in 2016, as a minimum requirement, he said.
These partners were mainly going to be from within the existing VMware partner base, and on the whole it would be resellers focused around SMB and mid-market.
VMware is also increasing its AirWatch reseller rewards based around something it has dubbed a Power Play. A Power Play with VMware is chosen every six months, and it aligns all of the resources in terms of marketing and a partner perspective to drive that Power Play.
VMWare has been sued in Hamburg for failing to comply with Open Source rules.
The Software Freedom Conservancy said that Christoph Hellwig’s lawsuit against VMware has started in the district court of Hamburg.
In a statement the Conservancy said that it was a regretful but necessary next step in both Hellwig and Conservancy’s ongoing effort to convince VMware to comply properly with the terms of the GPLv2.
For those who came in late, GPLv2 is the licence of Linux and many other Open Source and Free Software included in VMware’s ESXi products.
Hellwig is a key Linux kernel developer and one of the earliest members of Conservancy’s GPL Compliance Project for Linux Developers. He has been muttering about VMware’s misuse of GPL-licensed code since 2007.
In 2011, Conservancy discovered that VMware had failed to provide nor offer any source code for the version of BusyBox included in VMware’s ESXi products (as required by BusyBox’s licence, GPLv2).
Hellwig joined Conservancy’s GPL Compliance for Linux Developers in late 2012 and helped provide an analysis of the non-compliant releases of ESXi that VMware provided.
The conservancy said that it became apparent that VMware’s current ESXi products infringed many of Hellwig’s own copyrights, due to VMware’s failure to comply with Linux’s licence, GPLv2.
But VMware’s legal counsel finally informed Conservancy in 2014 that VMware had no intention of ceasing their distribution of proprietary-licensed works derived from Hellwig’s and other kernel developers’ copyrights, despite the terms of GPLv2.
The Conservancy and Hellwig claim that VMware has combined copyrighted Linux code, licensed under GPLv2, with their own proprietary code called “vmkernel” and distributed the entire combined work without providing nor offering complete, corresponding source code for that combined work under terms of the GPLv2.
Hellwig is an extensive copyright holder in the portions of Linux that VMware misappropriated and used together in a single, new work without permission.
VMware has announced new programs and other initiatives for its partner network.
The announcement, made at this week’s VMware Partner Exchange 2015, is tied to the outfit’s cunning plan to push “business transformation in the mobile cloud era”.
The VMware Partner Professional Services Programme will let consulting partners to sell and deliver their own services. Partners will have free access to experienced software-defined data centre architects and experts. They will also get access to customer-focused labs along with training discounts, the company said.
The scheme is only available to a limited number of pilot partners in the first half of fiscal 2015, the program is expected to expand in the second half of the year.
VMware has been expanding its VMware vCloud Air Network Programme to include managed services opportunities for vCloud Air Network service providers. This will enable partners to use VMware vCloud Air as their core infrastructure while providing differentiation through their managed services. This gives partners more flexibility in how to build and offer cloud solutions. The new managed services model will be available in the second quarter to qualified service providers.
Activist investor Elliott Management is trying to get data storage products outfit EMC to spin off its VMware virtualization software unit or merge with someone else.
The outfit penned a 13-page letter to the company’s board which was signed by portfolio manager Jesse Cohn and warned that EMC’s structure of combining several businesses obscured its enormous value.
Elliott, which has $25 billion under management, owns a 2.2 percent stake in EMC and said it was writing a letter to help inform EMC’s board on its “current review process” of how to maximize long-term value at EMC.
EMC’s “federation strategy” comprises a core data-storage unit, a virtualization software unit VMware, enterprise security business RSA and cloud-computing software maker Pivotal.
EMC held merger talks with HP recently that broke down. Elliott said the acquisition interest in EMC’s assets on the part of several large companies that make strategic sense.
So far, EMC has publicly said it plans to keep its company together. But pressure is building as other technology companies recently have been spinning off operations in an attempt to become more agile and capitalize on faster-growing businesses.
Distributor Arrow Electronics said it had received two gongs at the VMWare partner exchange.
It picked up the Partner Network award and also was recognised as emEA Distributor Partner of the year.
Jesper Trolle, VP of sales for Arrow enterprise computing in EMEA said his company has a key focus on products such as VMWare’s desktop-as-a-service and NSX network virtualisation. That contributes to the channel’s bottom line.
And Dave O’Callaghan, senior VP at VMWare in charge of partners said Arrow had distinguished itself at the global level. “We congratulate Arrow on winning a global VMWare Partner network award.”
Arrow supplies over 100,000 OEMs, contract manufacturers and commercial customers. It operates across 460 place in 58 countries.
Bull Information Systems has put together a new big data analytics tool called “bullion fast data analytics”, designed to look at data from the digital economy in real time.
It has been built using Pivotal based technologies in combination with Bull’s bullion servers.
Bull points out that this year there are roughly 3 Zettabytes of data floating around, or 400 Gigabytes for everyone on the planet, with this figure only set to increase to up to 40 Zettabytes by 2020. So for it’s very useful for organisations to be able to sift through this data and extract relevant information, whether that is managing crises, or building customer loyalty. Of course, we have all heard about “big data” this year.
Fast data analytics is, Bull asserts, the “first platform to integrate new data fabrics, modern programming frameworks, cloud portability and support for legacy systems”. The architecture has been designed on top of Pivotal Greenplum Database and Gemfire, and the company promises the end product makes analytics less complex, shifting the focus from software tinkering to applying the actual information.
The company says its technology is highly flexible and can “significantly” reduce Total Cost of Ownership, as well as having been validated with Pivotal and VMware at Bull’s R&D labs. It runs in a virtualised environement, promises lower latency, and cost savings.
VP of Bull’s enterprise service business, Jacqueline Moussa, said the company offers a “unified and robust platform”.
“Organisations can take advantage of lower implementation and operations costs and quick real-time analysis of the huge amounts of data being produced each hour,” Moussa said.