A Response to InformationWeek’s “Why Hasn’t Hyper-V Achieved World Domination Yet?”

by Mark Campbell on July 31, 2012

Jake McTigue over at InformationWeek has an article entitled “Why Hasn’t Hyper-V Achieved World Domination Yet?”  I thought it was an interesting piece – and thought it was worth exploring its central thesis in this blog.

Jake opens his blog entry as follows:

Despite ongoing innovation by seated virtualization giant VMware, Microsoft continues to match core hypervisor features while competing strongly on price. No surprise, then, that Hyper-V is gaining market share. But I must confess that I’m a bit disappointed in Redmond’s performance, in light of its track record for mercilessly crushing the competition, even in established markets where it previously held no competency.

This seems fair enough.  While VMware is vastly superior to Hyper-V technically at this moment, Windows Server 2012′s implementation of Hyper-V  cuts the gap a great deal.  What’s amazing to me is that Microsoft has been growing Hyper-V virtualization penetration at such a high rate with a product so far behind VMware’s – and what I mean by that is the Windows Server 2008 R2 implementation of Hyper-V versus the VMware vSphere 5 implementation.  I think that Microsoft’s “merciless crushing” through marketing tactics is evident in that growth.

It seems to me that Microsoft is not effectively applying its tried-and-true formula for seizing dominance. And that’s a problem for IT, because the lack of a single industry-standard hypervisor platform is hurting the market from a standards and interoperability perspective.

Of course, this is Jake’s opinion – and he’s absolutely entitled to it.  My opinion is that the hypervisor market is plenty big enough for not only VMware and Microsoft but Citrix and others as well.

Skipping through a little bit of the post, we get to Jake’s central thesis concerning why Microsoft hasn’t done a better job against VMware – that they’ve been lax in executing their “formula” of market dominance.  This formula as per Jake consists of (1) producing a copycat product and pricing it aggressively, (2) building it into Windows as a “built-in” extension.  Jake notes success here.

I’d note the following.  First, I think the gap between prior versions of Hyper-V (the ones based on versions of Windows prior to Windows Server 2012) and VMware vSphere are large enough such that the term “copycat” doesn’t really apply unless the “concept” of a hypervisor is what’s being discussed.  I hope this isn’t the case – because I like the fact that Microsoft (and Red Hat, and Oracle, and Citrix, and others) are competing in the hypervisor space.  Second, I think Microsoft has succeeded in aggressive pricing – which I like because it brings more functionality into the hands of more buyers.  Third, Windows has extended their Windows operating system with Hyper-V – just as other virtualization vendors have extended operating systems.

Finally, Jake notes

Where is the slur marketeering and propaganda campaign? The dirty licensing tactics? The aggressive litigation?

I think if the reader had doubts when starting to read this as to the author’s sincerity, any reader is pretty much past it by this point.  Even so, I’ll take this at face value.  In terms of propaganda and slur marketing – seems to me that there’s plenty to go around between both vendors.  Both are “guilty” of spinning the facts to their advantage – which is what I expect vendors to do.  In terms of licensing, my only comment will be that from a backup vendor perspective, I really like the fact that Microsoft keeps its VSS API’s available for use on the free version of Hyper-V – and hope that VMware will one day make VADP available on the free version of VMware vSphere.  From a broader perspective, I don’t think that VMware helped its case when it went to RAM-based licensing in VMware vSphere 5.0 – although I think Microsoft’s licensing is a Rube Goldberg machine of complexity.  And in terms of aggressive litigation - I’d think Microsoft and VMware are both being careful in terms of patent violations.

So what’s the bottom line?  It really gets back to the central thesis of the piece.  I’m glad VMware and Microsoft are competing with vSphere and Hyper-V – I think that not only the overall industry but users are better for it.  I hope they keep competing for years to come.

 

{ 10 comments… read them below or add one }

Ken Steeves August 1, 2012 at 12:55 pm

VMware already (and has for several years) provides a Free version of vSphere Hypervisor.

You can even get support (yes real human support!) on VMware’s free hypervisor.

What kind of support do you get for Microsoft’s paid for products?

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Mark Campbell August 30, 2012 at 4:36 am

Ken: Thanks tremendously for the note. Yep – you’re right, VMware vSphere unlicensed (free) is absolutely out there – as are free versions of hypervisors from Microsoft and Citrix. Point I was making was that when you’re evaluating “free”, what you’re always doing is trying to understand where the demand curve is – in other words, when do you have to start spending money (and for what are you spending that money.) I love the fact that VMware recently recanted on the whole vRAM licensing issue – I just hope that they’ll soon make their “free” as attractive as Microsoft and Citrix “free.”

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Jake McTigue August 1, 2012 at 4:02 pm

Mark,

I’m glad that my column on InformationWeek.com piqued your interest enough to elicit such a thorough response!

While I must agree with you that Microsoft has certainly been successful in seizing VMware market share, their efficacy at doing so pales in comparison to conquests of their past. After all, they’ve left a veritable corporate graveyard behind them when it comes to aggressive domination of emergent technical markets. Word processors, web browsers, network operating systems, gaming consoles… the list goes on.

Yet VMware has continued to show strongly as the dominant hypervisor, and I believe this is because VMware has never become complacent with regards to innovation. vMotion, HA, DRS, Storage vMotion, VMsafe (now vshield), VCB (now VADP) and VIX (and other APIs), all VMware originals that Redmond later sought to duplicate.

At present, Microsoft is following VMware in lockstep into the new cloud management and distributed architecture suites that both are so fervently evangelizing, but you can’t take the lead without actually going first into new territory: and Microsoft just isn’t innovating. Now you can’t blame Microsoft, VMware has shown an uncanny ability to both predict market needs and respond with innovative solutions. If Microsoft wants to compete, they’ve got to duplicate the feature set. But VMware has never lost the strong market lead in terms of functionality that they earned by making the first business class, industry standard hypervisor and essentially, creating the field on which they both now compete. At some point, VMware will fail to innovate and Hyper-V will catch up in both functionality and maturity, but we’re not there yet.

In the meantime, we still aren’t seeing the full might of Microsoft’s traditional propaganda, litigation, price cut and market manipulation campaign that we’ve seen in their epic battles of the past, and I have to wonder why. Is it the threat of another federal anti-trust battle that has made the giant toothless? Is it because of Gates’ relative lack of involvement and the sheer hugeness of the latter day Microsoft?

And as to your point about competition being good for the market, you were correct in believing that my commentary was indeed meant to be tongue-in-cheek. In truth, I’m a big supporter of alternatives and a robust, competitive marketplace. Still, I’d like to see a lot more innovation and less copycatting from Redmond.

Thanks for stopping by!

JM

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Naveen August 29, 2012 at 5:28 am

You will never see that from MS. They compete just to make thier ground safe..and not to really help the customer…only Apple, Citrix have been spared and Oracle managed to escape…

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Mark Campbell August 30, 2012 at 4:38 am

Naveen: I honestly couldn’t tell you the motivations for Microsoft or VMware or Citrix or anyone else – but what I love is competition so that all of these vendors are forced to be accountable to creating the best value proposition for customres.

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Mark Campbell August 30, 2012 at 4:44 am

Jake: Thanks *tremendously* for this. I think that there’s no doubt that at the enterprise-level of the market for advanced functionality, VMware is ahead. I’d like to see that same level of innovation by VMware at the SMB level. SMB customers are typically (and this is per the major analysts groups as well as personal experience) looking for innovation that just isn’t techncial feature oriented but go to market oriented as well. I’m afraid that even with some of the really great stuff announced at VMworld this week, that VMware may be in trouble with respect to Windows Server 2012 and Hyper-V V3 in the lower end of the small business space.

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Naveen August 29, 2012 at 5:24 am

MS will WIN…coz..it has huge money and thats the reason its bin able to narrow the competion…when you throw money..you WILL get good brains.. VMware is just a tiny weeny company…its actually a shame MS is forced to comepete with VM….Founders of VM ought to have had the vision of coming in MS path..so its thier fault and they will pay for it.

Bottom line….DONT INNOVATE and invoke MS wrath….they feel extermely insecure abt themselves…

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Mark Campbell August 30, 2012 at 4:41 am

You’re absolutely right that Microsoft is a huge, $80B, company and VMware is much smaller. But I think at the end of the day it’s about (a) competitive focus and (b) innovation. I think that VMware has taken an incredible first step with the elimination of the vRAM license – now they need to pick up their offering at the free, Essentials, and Essentials+ kit level. There’s evidence at VMworld this week that they’re doing just that in terms of Essentials all the way to Enterprise with some really cool stuff – but they have to at the same time really focus on the value of their free edition as well (in my opinion.)

Thanks tremendously for leaving thse notes.

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Naveen August 29, 2012 at 5:26 am

Also…noboday talk abt LAn anymore…none talk abt file services anymore…nodbody talks abt Directory services any more (read Novell)…and post VM war none will talk abt virtualization any more….

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Mark Campbell August 30, 2012 at 4:53 am

By the way – should be noted that VMware “copycat’ed” Microsoft in a TREMENDOUSLY GOOD WAY by getting rid of the vRAM licensing discussed herein.

I honestly do get the whole copycat thing – but I probably view it differently. VMware is the world’s leader in virtualization technology and features. Microsoft is the world’s leader at server operating system go-to-market features – and by that I mean that Microsoft is great at affordably addressing customer’s needs. Microsoft is beset by competition – from VMware and Citrix in hypervisors (in very different ways) – from Linux in server operating systems – and of course in clients Apple is really climbing against the company.

I believe in “innovate or die.” I think that Microsoft, at $80B or so in revenue, isn’t going to be the technology innovator in every space. But I like the fact that they are often the go-to-market innovator in terms of affordable technology.

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