VMware (NYSE:VMW) looks to take on Amazon (NASDAQ:AMZN)

VMware (NYSE:VMW) looks to take on Amazon (NASDAQ:AMZN)

VMware looks to take on Amazon VMware (NYSE:VMW) looks to take on Amazon (NASDAQ:AMZN)SAN FRANCISCO –   Industry analysts are beginning to weigh in on VMware’s (NYSE:VMW) much anticipated release of their vCloud Hybrid Service (vCHS).  The service, which was released earlier this month at the annual VMworld Conference, is an essential part of the company’s cloud strategy.  Some analysts wonder whether the service robust enough to take on Amazon (NASDAQ:AMZN) Web Services (AWS).


According to Greylock partner Jerry Chen it does not matter as ‘vCHS and AWS are addressing different types of applications and different types of customers.  Instead of being an offensive move against Amazon, vCHS is first a defensive move.’  Chen continues to explain that the release is more about helping customers ‘extend’ their data centers into the cloud – a move that seeks to deflect pressure on the company’s core virtualization market from Microsoft.

While VMware CEO Pat Gelsinger acknowledged that AWS is a potential cloud competitor, he believes that the value proposition of vCHS is meant for different customers.  In its latest Magic Quadrant report, Gartner Research described AWS as ‘ideal for large-scale batch computing jobs in which a large amount of computer resources are needed, sometimes for just a short period of time.’  VMware’s solution, however, is focused on connecting on-premises VMware-powered virtual machines into its cloud.

According to Gartner IaaS analyst Kyle Hilgendorf, the release of vCHS is a move VMware had to do given the lackluster performance of its vCloud Director product.  That product was a software platform for service providers to set up their own public clouds.  In a recent blog post, Hilgendorf stated, ‘I think long term, many organizations will not be able to avoid using it in some capacity.  Even some of the largest AWS adopters will find a place where vCHS shines past AWS.’

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Ultimately, the market is large enough for AWS and VMware as many organizations will seek multiple IaaS partners as a meant to diversify risk.  However, vCHS will still go through a ‘ramp-up period’ where additional improvements will be conducted.  According to Jack Clark at The Guardian, one such improvement could be the inclusion of a storage component, which is currently missing from VMware’s solution.  A move in this direction would be a clear signal that the company is looking to go head-to-head with AWS.