Want to look at two legacy vendors displaying wildly differing approaches to the public cloud? Roll up and compare Dell and VMware. In the past few weeks Dell announced that it was backing away from its OpenStack powered private cloud while VMware announced its long-rumored hybrid cloud. Two different vendors but both looking for ways to remain relevant in an increasingly complex and heterogeneous world. The two are coming to this from different angles however.

Dell – Taming the Complexity

As Barton George from Dell wrote in his blog post announcing the move away from their own public cloud, Dell doesn’t believe it can contain all different use cases within its own stable. As he said:

we’ve come to realize that the greatest way we can provide value for our customers is to focus our investments on more strategic components of the cloud and provide our customers with maximum choice and flexibility. As a result, rather than building out and supporting our own multi-tenant public cloud, we will partner with companies in order to provide customers access to the cloud(s) of their choice

It’s an interesting perspective, particularly since Dell was one of the early backers of OpenStack. Here we have a vendor known traditionally as a supplier of hardware, deciding to move away from offering a service built on top of that hardware. But we also see a company coming to a decision based both on fear of a backlash from its customers, and a realization that competing with the massive public cloud players is a road to pain. In making this decision, Dell has had to look for opportunities that avoid it alienating its existing independent IaaS customers (no one wants their supplier to compete with them, a fact not lost to the commentators when it comes to Amazon competing with massive AWS customer Netflix). At the same time it wants to be able to sell a value-added product rather than plain storage and compute which is fast becoming, if not a commodity, at least a diminishing margin product.

Instead Dell has decided that its best opportunity lies in creating the orchestration layer that sits atop of heterogeneous infrastructure – it’s an approach that I’m pretty positive about – I often talk about the big opportunities in the cloud resting on these type of “fabric” plays – platforms that span a number of different solutions (be they infrastructure, platform or software) and tie them together under the “single pane of glass”. For this reason, and given Dell’s situation, backing away from the public cloud at the same time as acquiring enStratius makes perfect sense.

So under the same lens, is the VMware hybrid cloud destined to failure? Not so fast.

VMware – Delivering on a Roadmap for Customers

VMware is a company that is often derided as the creator of enterprise FUD – this was clearly evident in CEO Pat Gelsinger‘s recent presentation to partners where he made them tremble with the assertion that a workload lost to AWS is a workload lost forever. But if we look beyond the sabre rattling, there is a definite method to the madness.

The bottom line is that while cloud vendors are quick to write case studies about the large enterprise customers using their services, there’s a massive amount of enterprise IT still sitting on “old tin”. People like to chuckle about the critical airline systems still running on mainframes – but it’s a fact – the life cycle for critical enterprise technology is surprisingly long and if you’re an enterprise decision maker – deciding to leave something alone that is still working is a no brainer – if it ain’t broke, don’t fix it.

In this situation, CIOs aren’t looking for case studies and solution sets that see them move everything en masse to this fabled cloud thing. What they’re looking for is a vendor who can support their existing technology landscape, but still give them a compelling story around moving appropriate workloads to the cloud. Of course it seems a little funny hearing this conservative message from VMware the company that is, after all, the home of virtualization and hence the disruptor of many bare metal use cases. It’s of the nature of things however to see companies attempt to gain maximum leverage out of previously innovative products – this is a topic that my friend Simon Wardley has written about at length.

VMware’s strategy one which makes sense for its current technology portfolio and customer spread – but it too needs to be mindful of the concerns of its partner channel who will undoubtedly feel a little uncomfortable with the idea of VMware, or particular partners, competing with them. The devil here is in the detail and we’re yet to see a clear indication of how VMware will navigate this path.


Interesting times in IT land – and two companies showing different, but interesting strategies. Shawn Douglass, CTO of ServiceMesh, hit the nail on the head when he commented about the dual announcements saying:

we see a pattern emerging of traditional IT Management vendors looking for new ways to ensure they have a ‘play’ as the hybrid cloud evolves and emerges. Beyond ensuring their own livelihood, however, what will be important to watch is how this evolves with management and compliance in mind. After all, the value is not in the virtualization of disk, compute and storage but in orchestration of those resources in the context of the application lifecycle, provisioning on the right infrastructure at the right time and place, in consideration of power, cooling and cost to meet service level objectives and governance requirements of the business

We’ve only just started moving along the continuum of legacy vendors reinventing themselves for the modern world – expect to see more interesting decisions coming in the weeks and months ahead.

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

1 Comment
  • David Mazursky |

    Great post, and it will be interesting to see how the other major Enterprise IT players shift.

    VMware’s strategy is also related to its parent EMC, and to its partners (like us) they obviously have to play many sides of things.

    Good stuff…

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