VMWare Ditches CEO, Stock Craters

Diane Greene is pitched overboard as the Ship VMWare sails on. They pick up Paul Maritz, a former Microsoft exec in midtack. Regardless the stock plummets by 1/3rd. Like always a lot of boardroom intrigue that will be reported on for the next week in the tech press. But does it really matter? I say no.

A causative agent –

People said when Linux deployed KVM companies would fall. And they were right!

Well maybe not quite that dramatic but the notation is apt. The latest kernel release supports virtualization thru the service module KVM. Yes Mildred as in free, as in beer. That simple fact just jacked up the entry fee for being considered a ‘modern OS’. A term the tech press likes to throw around from time to time But it alters the virtualization marketplace.

The Industry Result –

The virtualization industry could be roughly broken down into two types — OS inclusive and OS exclusive. I use these terms rather than the typical Hypervisior vs Container based virtualization. The reason will become readily apparent.

First the OS exclusive players. This group is made up by firms like Parallels and VMWare. Their products are add on externals to the OS in most cases. Second are the OS inclusive players. This group is comprised by the likes of Microsoft Virtual PC, Xen from XenSource [now part of Citrix] and of course KVM for Linux.

The difference in the two camps is important. Those of the inclusive group will be melded into the OS of their respective mother products. So it would be quite possible that Win7, when it comes out, will have virtualization as a standard feature of the OS. Starts to sound like a repeat of the IE inclusion in Windows doesn’t it? Well folks that’s the way it will play out in the marketplace.

So when all the OS’s have their respective inclusive virtual tools in place wither the exclusive players? Extinction or marginalization. There will be a niche for folks like Parallels in the IA32 and OSX space for quite some time. Even VMWare will have a fair run providing their Desktop virtualization products. But the long term is not going to be favorable to the exclusives.