VMware’s marketing virtualization’s value – can do more with less

Quoting an Investor’s Business Daily interview to VMware President, Diane Greene, reported on the VMware press archive:

Mom’s old saying “Waste not, want not” applies as much to tech gear as it does to personal finance, old toys and uneaten vegetables.

As techies hail the speed milestones being reached by IntelINTC and Advanced Micro DevicesAMD, many overlook an awkward reality: Most of that silicon brainpower isn’t being used.

VMware President Diane Greene aims to change that. Her Palo Alto, Calif., company is bringing a technology called virtualization — once the sole domain of mainframe computers — to the masses.

The VM stands for virtual machine, a technique that fools software into thinking that one computer is really two, three or a score of machines. This lets firms run lots of software on a single system rather than having to buy a separate machine for every application — and see the PCs sit idle most of the time.

The upshot: Companies can do more with less.

Virtualization isn’t new. But VMware made it possible for the first time on cheap PC servers.

Today, VMware has partnerships with all of the major server vendors and chipmakers. With the chipmakers, the pacts make it easy for VMware to run with chips made by Intel and AMD. Many of the server makers, meanwhile, resell VMware with their hardware.

In 2003, data gear maker EMC bought the company. VMware operates as an independent subsidiary.

Greene recently spoke with IBD about virtualization.

IBD: Why does this technology matter?

Greene: It puts in a layer of software that allows you to manage your hardware separately from your software. That gives you incredible power to do all the management functions better and in ways that were not possible before. It’s a better way to compute and a profound way to give hardware independence to the software.

IBD: More tangibly, what makes this so attractive to server vendors, let alone customers?

Greene: It’s a huge (cost of ownership savings of) 20% to 30% typically — some people say it’s up to 80%. It’s also a huge timesaver.

IBD: Describe the virtualization market.

Greene: In the (market for machines powered by Intel or compatible chips), VMware is the undisputed leader. We created the market and we definitely lead it. We have a strong track record of moving our road map and technology forward pretty aggressively. We have 3 million users and 10,000 enterprise customers. Many of our customers use it on more than 50% of their Intel servers.

IBD: Who are your rivals?

Greene: Of course, the IBMIBM mainframe has virtualization. Then there’s virtualization on the (IBM) pSeries. And Sun (MicrosystemsSUNW ) has built this “container” functionality into Solaris (its server operating system) for their Unix systems. Those tend be a different set of applications and uses than what people are doing with us in the Intel space. Certainly MicrosoftMSFT is coming into this space.

IBD: Does that worry you?

Greene: Ultimately we’re going to work well with Microsoft. We’re doing good things for Microsoft. In the Intel space, bringing in a lot of mainframe-style functionality has helped accelerate x86 (Intel-compatible) adoption into data centers (most of which run Microsoft Windows). So we’re going to want our systems to work together and go to market together. But today, they’re coming in competitively.

IBD: How much of your software goes into Microsoft Windows-based systems?

Greene: Windows dominates, just as it does in the industry. But we have a substantive set of Linux customers. Then we have a lot of customers in mixed environments: Linux and Windows and NovellNOVL. And we’ve got experimental support for Solaris on x86.

IBD: Is that mix changing?

Greene: We’ve certainly seen a rise in Linux over the years that’s been fairly dramatic. And it’s going to be very interesting to watch Solaris x86 to see what happens there. We’re getting more and more demand for it.

IBD: Who are your partners?

Greene: HP (Hewlett-PackardHPQ ), IBM and DellDELL are three of our strongest partners. We’ve been working with them for years. We work with all the storage vendors, all the Intel vendors, the chip vendors and the system management vendors like CA (Computer AssociatesCA) and BMC SoftwareBMC .

IBD: Your parent, EMC, competes with several of those companies. How do you manage that web of relationships?

Greene: When EMC bought us, we were treated as an independent subsidiary, because our partnerships are so key to what we do. We’re about running on any (Intel-compatible) hardware and any operating system. For the first six months, everybody thought maybe (VMware’s independence from EMC) will change. Now it’s clearly established that that’s the way it is and it’s not going to change. Since the acquisition, we’ve been able to grow our relationships with IBM and HP.

IBD: Do you collaborate with EMC or maintain a separation?

Greene: We have to (have separation) because of our partnerships, because we do co-development with our partners. In the same way, we do co-development with EMC. When people do server consolidation, they generally do storage consolidation. A lot of EMC (storage-area networks) are working with VMware virtual infrastructure.

IBD: You just signed a deal with Intel. What impact will this have on your company and technology?

Greene: We’ve been working with Intel almost since the beginning. We’ve taken it a step up in that we’re going to collaborate around (Intel’s VT) virtualization technology. They’re putting support in their chip set. The first incarnation of VT is due out this year on the desktop and next year on the server.

IBD: How does Intel’s input help?

Greene: When VMware first virtualized the x86 back in 1998, there was no support. That creates some overhead because of some of the trickery we have to do to virtualize it. Now Intel is adding instruction support to the chip to reduce that overhead. For the customer, it will further expand the universe of applications that will want to take advantage of virtualization