VMware Looks to Lure Virtual Iron Users from Oracle

VMware is hoping to entice Virtual Iron customers away from Oracle, which bought Virtual Iron in May. Oracle reportedly is telling Virtual Iron partners that it is halting development of Virtual Iron products and will integrate the technology into its own Oracle VM platform. VMware is offering discounts on products, including its new vSphere 4 virtualization platform, to Virtual Iron customers.

VMware is offering discounts on products, including its new vSphere 4 virtualization platform, to customers of Virtual Iron, the virtualization company bought by Oracle in May.

VMware on June 7 unveiled what it calls "safe passage" to Virtual Iron customers in the wake of reports that Oracle will shut down development of existing Virtual Iron products, opting instead to absorb those products into its own Oracle VM virtualization platform.

The virtualization technologies from both Oracle and Virtual Iron are based on Xen, the open-source hypervisor.

Oracle reportedly sent a letter in June to Virtual Iron partners saying that it not only is ending development of the company's virtualization products, but is also stopping the delivery of orders to new customers.

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In announcing the new incentive program for Virtual Iron customers, VMware officials emphasized their company's breadth of virtualization products and stable road map as enticements to move away from Oracle.

Charles King, an analyst with Pund-IT Research, also said that VMware has is previous successes to fall back on, including all the global enterprises that now run VMware virtualization technology. That could be a big selling point as Virtual Iron customers decide in which direction to head, particularly in a case like this, where the acquiring company has decided to end development and support of the products bought in the deal.

"If migrating to a new platform is required, why not consider an entirely new vendor as well?" King said in a report issued July 8. "That ... is precisely what VMware has in mind for Virtual Iron's cleintele."

The program-which includes price discounts-covers those Virtual Iron customers with current license and support contracts. The VMware products included in the program are VMware vSphere 4 Advanced Edition, VMware vSphere 4 Enterprise Plus Edition, VMware vCenter Server Foundation and VMware vCenter Server Standard.

The Virtual Iron customers also are eligible for discounts on support and subscription on those products. To take advantage of the program-which runs through Sept. 30-Virtual Iron customers need to show proof of a current VI license and support contract.

The way Oracle is handling the Virtual Iron acquisition could have a ripple effect on the company in several areas moving forward, according to King. Virtual Iron had anywhere from 2,000 to 3,000 customers, and it's no sure bet that they will stay with Oracle and its virtualization technology, he said.

In addition, the seemingly heavy-handed way Oracle with dealing with this acquisition is reminiscent of its PeopleSoft acquisition, King said. Overall, some comapnies like IBM and EMC have done a better job handling the post-acquisition tasks than Oracle, he said.

It also could give some pause to Sun Microsystems customers. Oracle is expected to complete its acquisition of Sun this summer -- Sun investors are slated to vote on the $7.4 billion deal July 16 -- and while Oracle CEO Larry Ellison has said that Sun's products will be well taken care of by Oracle, the company's handling of Virtual Iron will be closely watched, but rivals as well as customers.

"It would not be surprising if Sun customers monitor the Virtual Iron situation closely, or if Sun's competitors seek to turn any Oracle missteps into commercial opportunities for themselves," King wrote.