Microsoft hungry to eat VMware's lunch

Software maker tells CNET it's posting an open letter to VMware customers, aiming to get them to think twice before signing long-term deals with the virtualization leader.

Ina Fried Former Staff writer, CNET News
During her years at CNET News, Ina Fried changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley.
Ina Fried
2 min read

As VMware prepares for this week's annual conference, Microsoft is looking to steal both the company's thunder and its customers.

In an advertisement in Tuesday's USA Today, Microsoft urges VMware customers to think twice before signing a new long-term contract with the virtualization company.

"VMware is asking many of you to sign three-year license agreements for your virtualization projects," Microsoft vice president Brad Anderson writes in an open letter to VMware customers. "But with the arrival of cloud computing, signing up for a three-year virtualization commitment may lock you into a vendor that cannot provide you with the breadth of technology, flexibility or scale, that you'll need to build a complete cloud computing environment."

Microsoft's open letter to VMware customers, to be published in USA Today on Aug. 31. (Click to see larger version) Microsoft

Microsoft hopes to make the case that VMware's approach centers on virtualization as a cost-saving means rather than in the broader shift of data from being stored in a company's own data center into one in which data is stored both locally and on a third-party's cloud-based service.

"Virtualization, while a necessary component of a move to the cloud, isn't by itself sufficient," Microsoft's Amy Barzdukas told CNET in a telephone interview on Monday. Microsoft talks about how it is moving all of its major server products to being offered as both server software and hosted cloud-based services.

A VMware representative was not immediately available for comment.

Even in the virtualization category, which has long been dominated by VMware, Microsoft maintains that it has shrunk the technical gap with its rival while offering a significantly lower cost.

"If you're evaluating a new licensing agreement with VMware, talk to us first," Anderson writes in the letter. "You have nothing to lose and plenty to gain. Not only is Microsoft's server virtualization solution approximately one-third the cost of a comparable solution from VMware, but also a recent Microsoft study of 150 large companies showed those running Microsoft virtualization spent 24 percent less on IT labor on an ongoing basis.

The open letter is just the latest in Microsoft's ongoing effort to sway businesses to its view of the cloud. In particular, Microsoft has been stepping up its anti-VMware rhetoric, including sharp words from server and tools boss Bob Muglia at two recent Microsoft conferences.

"VMware comes from the perspective of virtualization, virtualization, virtualization," Muglia said at last month's Microsoft partner conference. "So they're an infrastructure as a service vendor, predominately...There's only one vendor that really covers the full set of dimensions, and that's Microsoft."

The battle between Microsoft and VMware has been taking shape for several years now as Microsoft has introduced and beefed-up its Hyper-V hypervisor product. VMware, meanwhile, has included lower cost and free versions of its server software as it has added more management and other capabilities to its higher-end products.

As for the timing of the new advertisement, Barzdukas said, "We try to present voices and opinions at a time when they might be heard and this week seems like a good opportunity."