VMware Faces Virtual Reality

A year after VMware's successful IPO, virtualization has shifted gears from niche technology to the must-have underpinning for projects ranging from disaster recovery to data backup to desktop application delivery.

It's not surprising, then, that other companies are developing products for the market that VMware has been synonymous with up until now.

So CEO Diane Greene is looking two steps ahead. And what she sees is that server virtualization was only the start. The end destination is a fully automated data center, with x86 virtualization as the lynchpin holding all the various parts together. In this virtual world, applications are built specifically for virtual machines and are moved from virtual to physical systems, regardless of the operating system.

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To achieve this goal, VMware—the company Greene helped co-create in the mid-1990s and of which EMC now holds the majority stake—will have to face some stiff competition. Those rivals include Microsoft, which is entering the market later this year with Hyper-V and has a lock on ISVs building third-party applications.

For VMware, success in this field is about more than just the hypervisor—the specialized piece of software that makes virtualization possible. It also means changing the way IT thinks about, creates and delivers applications in a totally new data center.

Greene sat down with eWEEK Editor at Large Eric Lundquist and Staff Writer Scott Ferguson to discuss the company's initial public offering, the future of virtualization and why all those other companies—including the big one in Redmond, Wash.—are getting into virtualization this year. Following is an excerpted version of the discussion.

In a few weeks, VMware will mark the anniversary of its 2007 IPO. How did that event change the philosophy and the dynamics of the company?

First, I would say that VMware is a company that is very used to change. We kind of thrive on change. We have had very rapid growth, doubling every year; you are a different company every year when you have that type of growth.

Then, of course, we went through [EMC's acquisition of VMware in 2004], and that was a change, but our culture remained very intact as a company. So, by the time the IPO came around, we had become experts at maintaining consistency in the face of everything changing around [us], and I think we have done a really nice job of remaining who VMware is—a company that is really focused on innovation to drive value to customers and partners.

With the IPO, there is a new group of people that basically handle being a public company, and, personally, I am doing a quarterly earnings call, so there is more involved there. The IPO has meant increased attention and visibility, but that has been increasing all along, so it's basically another stage in our evolution.

You mention the added attention that VMware receives. Can you explain a bit more about that and how it affects the company?

It's a new set of responsibilities, plus people are now interested in what we have to say.

They see us leading [the virtualization] industry. They see us creating this industry, and they say, "Where are you taking this industry?" [VMware has] new sets of responsibility about communicating more broadly about where the industry can go and how we intend to get it there. Certainly, whatever we do, it is paid attention to. We have this sort of inherited culture of doing everything well, which is fortunate—when people are paying attention to what you do, you want to do it well.