VMware's Nicira acquisition adds fuel to its cloud management fire

VMware acquires Nicira and is expected to integrate it with its other cloud products, giving customers a flexible cloud management platform.

VMware's planned acquisition of Nicira represents a shift in its overall strategy for the near future. Despite...

the strong position it occupies with its proprietary virtualization technologies, the company is opening up to cloud users' demands for platform-agnostic support.

VMware Inc. said this week it will purchase network virtualization software provider Nicira Inc. for approximately $1.26 billion -- its largest acquisition to date -- just before its financial analysts call to discuss its second quarter earnings.

Nicira's Network Virtualization Platform (NVP) creates an abstraction layer between a physical network and the virtual switches deployed on hypervisor hosts. It uses controller software to provision and manage network services for virtual server workloads without regard to the type of network hardware. 

This fills an important gap in VMware's cloud virtualization strategy that one analyst said will improve the company’s software-defined networking (SDN) offerings.

Objectively speaking, it was a very complementary move for VMware.

Boris Renski, co-founder of Mirantis Inc.

"Objectively speaking, it was a very complementary move for VMware," said Boris Renski, co-founder of Mirantis Inc., a cloud systems integrator based in Mountain View, Calif.

"With SDN, virtual machines wouldn't care where they were [running] and, from the standpoint of the value to the customer, it's absolutely a good thing."

If VMware successfully integrates Nicira with other products in its portfolio, the company has a chance to significantly move forward in cloud management, said Alessandro Perilli, research director at Stamford, Conn.-based Gartner Inc.

But, "VMware has yet to prove vCloud Director, vCenter Operations Management, DynamicOps, Nicira and all other products can be integrated in a cohesive cloud management platform," Perilli said.

"Automating the VM deploying is the easiest part,” Perilli added. “Automating storage provisioning and network reconfiguration is definitively more challenging.”


VMware acquisitions strengthen cloud strategy

Nicira is the latest in a recent spate of VMware’s cloud-related purchases.

The company announced its intent to buy DynamicOps Inc., a maker of cloud management software that works with multiple hypervisors, in early July. VMware also purchased cloud data analytics startup Cetas Software earlier this year. 

In both the DynamicOps and Nicira acquisitions, VMware emphasizes support for multiple platforms, a growing demand from users.

"They are shifting their strategy to give customers more choice at the lowest level of the computing stack now that demand is growing and competitors like Microsoft are mature enough to represent a real threat in the near future," Perilli said.

The Nicira deal is expected to close in the second half of 2012.


Cloud spinoff remains unconfirmed

VMware reported record earnings last week at the same time it officially announced a shakeup in its executive suite.

During the analyst call, departing CEO Paul Maritz did his best to allay concerns among customers and partners that VMware is planning to spin off open source assets, including Cloud Foundry, into a separate company or division to better position itself for future growth in non-virtualization markets.

Speculation regarding a potential VMware cloud spinoff surfaced last week. While VMware executives have played down the possibility, they haven't outright denied customers' and experts' assertions.

"We have no specific plans [for a spinoff] at the current time," Maritz said in answer to one analyst's question during Monday's call.

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Does the purchase of Nicira make VMware more competitive in the cloud market?
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of providing a complete suite for cloud along with having the expertise in the same area.
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It will strengthen the networking at cloud.
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a leg up on Citrix
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to have a virtual system on top of virtual network and without worrying about the brands.
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A good move against Microsoft's virtual networks!
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It's all about provisioning in the cloud so the N/W cannot be excluded.
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SDN is the future of network mgt
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it knocks wind out of OpenStack and buys time to drives adoption of its own cloud stack.
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The network is a very important component for assured delivery of enterprise cloud services and the ability to reconfigure the network dynamically means better monitization of datacenter assets
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this is what VMWare is missing today.
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it's a deadly combination
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VMWare has been unable to integrate any of their mangement tools outside of their marketing materials. And the attempts to integrate what they have are abject failures and fabrications.

-an insiders view
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More virtualized layers
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Nicira is/was a great company with people that had a real vision for the future. Hopefully, VMWare will keep those people and take SDN to the next levels.
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This positions VMWare higher up in the Convergence trend as compared to hardware based options giving them a big chunk of service providers beyond telecoms that are trying to move up the value chain
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