VMware Has A Secret Weapon To Keep Enterprises Away From Amazon's Cloud

VMware CEO Pat Gelsinger at vCloud Hybrid Service launchVMware CEO Pat Gelsinger at the vCloud Hybrid Service event.

VMware’s software runs in pretty much every enterprise data centre on the planet, and now VMware is setting its sights on a much bigger market. 

On Tuesday, VMware unveiled its vCloud Hybrid Service, which is a “public cloud” service that lets customers rent servers and storage over the Internet. It’s similar to Amazon Web Services, which dominates the public cloud industry. But VMware has tailored its cloud for enterprises. 

Lots of other competing cloud service providers are doing the same thing, including IBM, HP and Microsoft, who all have cloud services geared for big businesses.

But the vCloud Hybrid Service has an edge in one special way. It works well with VMware’s “server virtualization” software, which lets lots of apps and operating systems be packed onto a small number of physical computer servers.

With vCloud Hybrid Service, customers can easily move their apps from their own data centres to a vCloud service without having to rewrite their apps, or change their IT management software. 

“This, to us, is the magic that made virtualization real in the first place,” VMware CEO Pat Gelsinger said in a Tuesday press conference at VMware’s Palo Alto, Calif.-based headquarters.

Despite Amazon’s success, some enterprises still distrust the public cloud and think putting their valuable corporate data there is a recipe for disaster. Amazon also has a reputation for outages. That’s the sort of customer VMware is targeting. 

Another important point is that enterprises can run all their enterprise apps on vCloud Hybrid Service without a lot of testing. That will save them from “hidden costs” with other clouds, says VMware’s GM of cloud, Bill Fathers. This is a complaint customers have with Amazon’s cloud.  

vCloud Hybrid Service will launch as a private beta next month and will be available in the U.S. in the third quarter. It will be available in Europe and Asia in 2014.

There are two versions of the vCloud Hybrid Service: One where customers get their own dedicated hardware, sold on an annual contract with prices starting at 13 cents per hour for a 1 GB virtual computer with 1 processor.

The second is where customers share the hardware, known as a “multi-tenant” cloud. Customers will pay monthly for this option, and pricing starts at 4.5 cents per hour for 1 GB virtual computer with 1 processor.

Prices might still be adjusted. “We’re very focused on making sure we remain competitive,” Fathers said.

VMware is running vCloud Hybrid Service from four partner’s data centres, as opposed to spending tons of money to build its own. But it’s not naming its partners.

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