With a very short news just published by several press agencies VMware announces that its popular (and honestly beloved) CEO, Diane Greene, has been replaced by Paul Maritz.
Paul Maritz is the President and General Manager of Cloud Computing division at EMC, with a 14 years old career in Microsoft where he was Vice President of the Platforms Strategy and Developer Group.
It’s clear that VMware is working to enter the cloud computing space, but replacing a highly successful CEO like Diane Greene doesn’t seem the best way to do that.
Additionally, it’s odd that Maritz’s wikipedia entry is already updated with the new position while the official announcement didn’t provide any detail about the reasons behind such a sudden replacement or which kind of involvement Greene will have in the company in future.
It’s worth to highlight that the VMware’s Chief Scientist, Mendel Rosenblum, is also her husband.
This replacement, if imposed by the parent company EMC, may have a huge domino effect on the whole VMware management team.
Update: Some sources are reporting that Diane Greene was fired by the board and immediately replaced.
virtualization.info is unable to confirm this news, but we can speculate on the reason: the attempt to unchain VMware from EMC control, selling to another, more interesting partner like Intel.
It’s well know in fact that Diane Greene and Joe Tucci, EMC’s CEO, had a hard time working together since the early beginning.
Second update: Multiple news magazine are confirming that Diane Greene didn’t resign but was replaced.
The key question is not just why the board fired the VMware CEO, but most of all why it replaced the CEO with somebody totally unrelated with the company.
In normal conditions, the safest thing to do would be appointing the next charismatic person from the original executive team that led VMware before the EMC acquisition in 2003.
This would have avoided the panic and confusion among the employees, which are already reacting in a negative way. But EMC CEO preferred to pick a just arrived executive (Maritz arrived in EMC just in February 2008, after the acquisition of its company Pi) with a lengthy career at the VMware’s worst enemy.
A possible explanation is that Tucci couldn’t trust anybody in the VMware team and was obliged to appoints somebody totally outside the Greene’s influence.
And this makes sense only if the whole VMware’s management team was cooperating in something that implied the CEO’s removal.
Now it’s critical to understand what Mendel Rosenblum and the others will do. On their moves depend the confidence that VMware can maintain the market leadership against Microsoft.
Third update: At the end of the day the VMW performance suffered a –24.44%, translating in billion of dollars in losses:
Almost every news magazine reported that the Greene removal depended on the negative financial performance expected for the Q2 2008, lower than the forecast.
This is simply impossible: some slightly lower results would never be enough to justify the departure of a successful and popular CEO like Diane Greene.
EMC will have to provide extensive and credible explanations on what happened today to recover the investors’ trust and avoid an even lower result tomorrow.
Fifth update: BusinessWeek reveals that the Board of Directors offered to Diane another position in the company and she refused. Obviously the magazine can’t tell what conditions she’d agree on.
Sixth update: NetworkWorld reveals some critical details about what happened at the Board level.
Two members of eight, the only two that are not employed at EMC, were against the decision to remove Diane Greene: Dennis Powell, representing Cisco, and Reene James, representing Intel.
Cisco and Intel are exactly the two key firms that were rumored to be interested in the VMware take over during the last months, even if just few days ago Cisco CEO officially dismissed any interest in buying the company.
Cisco is not happy with the decision to remove Greene and as direct result just retired $78 million from its $150 million investment made before the last year VMware’s IPO.
The domino effect has just started.
Seventh update: virtualization.info published an exclusive document submitted by a VMware employee, revealing some critical details and exposing the confidential emails sent to the company by Joe Tucci and Paul Maritz.
Eighth update: Two days after the announcement (July 10) VMware filed a form 8-K to formalize the replacement of Diane Greene.
The document clarifies that the departure would be treated as a Termination without Cause.
Nineth update: In the sixth update above we reported that Cisco retired $78 million from its investment in VMware, trusting NetworkWorld source.
This is incorrect. Cisco lost that amount because of the stock performance but didn’t operate any modification on the amount of shares it owns.
blog comments powered by Disqus
virtualization.info Newest articles
July 19th, 2016
Yesterday IBM announced its results for Q2 2016.
If we compare with the same quarter in 2015 earnings per share, from continuing operations, decreased 22%. Net income, from continuing operations,…
June 24th, 2016
Red Hat announced its financial results for the first quarter of fiscal year 2017.
Total revenue for the first quarter was $568 million, with an increase of 18% from the…
June 24th, 2016
Today Red Hat released in beta version 4.0 of its KVM-based virtualization platform Red Hat Enterprise Virtualization (RHEV).
As a major release RHEV 4.0 ships a wide series of enhancements including:
June 21st, 2016
virtualization.info has been following WhatMatrix since its inception and, after 6 months since the website has been launched, we are happy to report that its community is growing and contributing…
June 21st, 2016
DockerCon 2016 began yesterday in Seattle with a number of announcements from Docker and key partners.
Here is a quick summary of the day:
Docker 1.12 with built-in orchestration: starting…
June 14th, 2016
Yesterday, Bellevue (WA) based company WinDocks, released a free edition of its homonymous port of the Docker daemon to Windows called WinDocks Community Edition.
The company, founded by a small…
May 12th, 2016
Containers’ security is one of the emerging topics in those companies moving this technology into production. A few small players emerged to compete exclusively in this portion of the…
May 3rd, 2016
RightScale is a Santa Barbara, CA based company, provider of a Software as a Service (SaaS) management solution that so far only supported standard Infrastructure as a Service (IaaS) cloud…
April 5th, 2016
Yesterday, Bellevue (WA) based company WinDocks, released version 1.0 of its homonymous Docker engine for Windows.
The company, founded by a small group of former Microsoft’s employees, rides Docker’s…
March 17th, 2016
LANDesk Software, founded in 1985 and headquartered in Salt Lake City, Utah , provides systems management, security management, service management, asset management and process management solutions with a strong focus…
March 15th, 2016
Last week open source giant Red Hat announced the availability of version 3.6 of its KVM-based virtualization platform Red Hat Enterprise Virtualization (RHEV).
While this new release provides the expected…
March 4th, 2016
Yesterday Docker announced to have acquired a semi-stealth startup called Conductant, focused on workloads orchestration.
Both Conductant’s founders, Bill Farner and David Chung, have significant enterprise experience coming from…
March 1st, 2016
Today Cisco announced the intent to acquire CliQr Technologies Inc., a privately held company based in San Jose, CA.
CliQr is one of the most promising startups in the Cloud…
February 11th, 2016
Yesterday VMware announced version 7 of both its vCloud and vRealize suites, confirming its efforts to be relevant in the CMPs (Cloud Management Platforms) space.
vRealize Suite 7 is made…