Wednesday, January 06, 2010

VMWare + Zimbra = Gmail?

The exciting rumor in the otherwise quiet enterprise technology news this week was of VMWare planning to buy Zimbra from Yahoo. The self-proclaimed 'Cyber Cynic' Steven J Vaughan-Nichols blogged about an article by Kara Swisher, questioning why VMWare should be interested in an open-source email platform. Why, in fact would Yahoo have spent $350M on Zimbra in the first place?

The virtualization market that VMWare claims to own is truly under threat. Not just from other proven virtualization vendors including RedHat sponsored KVM, XenServer (found on almost every serious server hosting package I've seen), Sun VirtualBox, but from the cloud too. So it makes sense that VMWare would want to do something to try and stay in the game. But email (sorry, 'collaboration'), really?! I honestly thought that between Microsoft Exchange (and the many vendors willing to host it for you), Gmail, and the sufficiently OK (for small businesses) free email that appears on basic web hosts, there was little room for another serious player in the enterprise email outsourcing market.

If Zimra truly is more than just an email server on steroids, then the competition may become IBM with Lotus in the cloud - if IBM finally works out how to start marketing that reinvigorated offering. Is VMWare really in that market? Maybe the company is in fact responding to's announcement of Chatter, its online collaborative tools. I wondered at this little announcement back in November. Either way, we all know email as a necessary evil, not something that can help you build control, visibility or efficiency into a business. Why buy into that overflowing inbox that most people complain about when they have nothing better to complain about?

EMC was truly renowned for making great technology acquisitions, making itself in quite a giant. It the major stakeholder of VMWare guiding this acquisition, or is this just the kid trying to beat Dad at his own game? The success of this acquisition could answer the question for us, though I don't see VMWare getting this right without buying a large cloud capability (VMWare + Rackspace = interesting) or partnering with Amazon EC2. Time will tell - though VMWare's stock seems to reflect a bullishness around this acquisition I just don't feel.

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