VMware Invests $100M in India

The money will pay for a new 82,000-square-foot development center in Bangalore and for staff increases.

VMware plans to invest $100 million in India over the next two years, adding more engineers and developers to its staff and increasing its research and development operations with a new facility.

During a March 24 news conference in Bangalore, India, CEO Diane Greene said the investment would include an 82,000-sqaure-foot development center in the city and increase the number of in-country engineers and developers to more than 1,000.

"India is also one of our fastest growing markets and where we have increasingly important system integrator partners," Greene said in a statement. "For these reasons, we are now substantively increasing our investment in India."

Since last summer, when VMware - the leading vendor of x86 virtualization technology - announced an initial public offering for 10 percent of the company in the summer, the company has begun expanding into emerging markets, such as India and China. VMware's majority stakeholder is parent company EMC.

The announcement also comes a week after Citrix said it had inked a deal with Lenovo that will bring its XenServer virtualization product into the Chinese market for the first time. Both Citrix and VMware are also facing new competition from Microsoft in the virtualization market. The software giant's Hyper-V virtualization option for Windows Server 2008 is slated for an August release.

In her statement, Greene said the $100 million investment will help expand VMware's R&D efforts in India as well as grow its customer base into emerging markets. Currently, VMware has about 300 customers in India.

The move also allows VMware to diversify its customer base outside the United States. As the U.S. economy continues to slow down, several major IT companies, including Intel and Hewlett-Packard, have turned to overseas revenues to offset their returns from the United States.