VMware (VMW) says Amazon Web Services is now the virtualization company's preferred public cloud services infrastructure provider. It's a safe bet IBM Cloud business leaders surely aren't pleased.
VMware and Amazon officially announced their relationship today. But the details sound strikingly similar to a VMware-IBM Cloud relationship unveiled in February 2016. At the time, VMware CEO Pat Gelsinger said:
“This partnership, an extension of our 14-year plus relationship with IBM, demonstrates a shared vision that will help enterprise customers more quickly and easily embrace the hybrid cloud. Our customers will be able to efficiently and securely deploy their proven software-defined solutions with sophisticated workload automation to take advantage of the flexibility and cost effectiveness of IBM Cloud.”
Jump to June 2016, and the VMware-IBM Cloud relationship expanded to include hosted desktops.
Then, VMware Falls for Amazon
Fast forward to present day, and VMware has essentially shifted its primary cloud infrastructure loyalty to Amazon. According to a statement from both companies:
"VMware Cloud on AWS will be the primary public cloud solution delivered, sold, and supported by VMware. AWS will be VMware’s primary public cloud infrastructure partner and VMware will be AWS’s primary private cloud partner in new strategic alliance."
I've asked both VMware and IBM to comment about their relationship and will update this article when I receive a reply. Also, I don't know if the new VMware-Amazon relationship includes hosted desktops. I sort of doubt it since Amazon Workspaces competes in some ways against VMware Horizon Desktop as a Service.
Despite the VMware-Amazon deal, IBM continues to evangelize VMware customer support. According to CloudTech:
"1,000 joint customers are now moving their VMware environments to the IBM Cloud, as well as mobilising and training 4,000 global service consultants to help VMware customers access and leverage IBM’s cloud. The news of customers involved in this partnership, including Marriott International and Monitise, were referenced at the recent VMworld event in August."
IBM Cloud Services: Under Pressure
Despite those IBM milestones, the VMware-Amazon relationship represents a serious wakeup call for IBM's cloud ambitions. Big Blue's cloud business has grown steadily since acquiring SoftLayer in 2013. For its Q2 2016, IBM's as-a-service annual revenue run rate was $6.7 billion, up 50 percent year over year.
However, the company's overall public cloud market share lags that of Amazon and Microsoft Azure. (IBM prefers to put the focus on its hybrid cloud and private cloud momentum.)
IBM's challenges are particularly large in the SMB market. Some of the company's VAR relationships became strained when IBM sold its x86 server business to Lenovo in 2014. The company also missed some clear opportunities to embrace MSPs that manage cloud services.
A case in point: Continuum runs its backup and disaster recovery platform in IBM's cloud. That platform supports hundreds of MSPs. Yet IBM was mostly mum during a recent Continuum gathering in Boston. It was a prime audience where Bluemix and other IBM offerings could have turned some heads.
And what of the IBM-VMware cloud relationship that looked so promising earlier this year? We're poking around for answers.
