Cisco-EMC-VMware Alliance Already Moving into New Sectors

The IT giants that formed the Virtual Computing Environment joint venture Nov. 3 to create and market modular cloud computing systems appear to be building a coalition with the combined market share and product lineup to go way beyond a single data center product rollout.

In fact, it's not too much of a stretch to imagine that Cisco Systems, VMware, EMC and Intel may be aligning themselves in an effort to revolutionize IT as we know it.

Only days after creating the VCE and its legal business entity, the shared-equity Acadia startup, to scope out solution packages and market the new vBlock cloud systems, the four market-leading companies appear to be moving into other trendy and fertile IT farmlands: namely, virtual desktops, hosted applications and new storage options.

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VMware announced on Nov. 9 the launching of View 4, the latest version of its desktop virtualization software that uses the company's vSphere 4 virtualization platform and the strong partnerships VMware has with EMC (for storage) and Cisco Systems (for networking).

Following its big move last March into the IT systems business by building servers for its Unified Computing System, Cisco jumped into the hosted e-mail business Nov. 9 by introducing WebEx Mail,  which will compete with Google's Gmail, Zoho Mail, IBM LotusLive iNotes and Microsoft Exchange Online. VMware and EMC also will be providing their products and services through this VCE coalition.

In addition, Cisco's Enterprise Collaboration Platform will take aim at IBM Lotus Connections and other enterprise social-networking software products from MindTouch, Socialtext, Jive Software and others.

Beginning of a trend?

So this is happening fast and furiously. Are we seeing the beginning of a trend? And which of the group is really the ringleader here? Cisco organized the Unified Computing System partnership, announced last March, but the others play vital roles in all of this, too.

"EMC's 2003 acquisition of VMware for $635 million has not only yielded a $15 billion-plus market cap return for shareholders, it has also placed EMC at the epicenter of the battle for data center dominance -- an amazing feat for a storage company," Wikibon storage and data center analyst David Vellante wrote in his blog Nov. 6. "EMC's leverage with VMware allows it to heavily influence this coalition, if not call many of the shots.

"The VCE partnership is clearly aimed at accelerating the revenue streams of VCE. While VCE claims the initiative is open, what it really means is it's not closed -- an important nuance. Specifically, VCE is a coalition designed to confer advantage to its direct participants and their customers -- if you're not invited to the party, you're at a disadvantage. Translation: the VMware deck is stacked in VCE's favor."

No surprise there.