EMC and VMware's Leadership Shuffle: Beginning of the End?
July 19, 2012
My fellow storage industry analysts are acting like the Kremlinologists of old, trying to read the tea leaves in EMC's recent executive shakeup. While it's always fun trying to figure out who's going to replace Joe Tucci when he finally retires from the top of the EMC pyramid, as somebody who actually tries to make IT kit work I'm more interested in what this means about the future of VMware and EMC's products than I am in the stock price or succession plan.
For those who haven't read any of the several million words already written on the subject, Pat Gelsinger, currently COO at EMC, will become CEO of EMC majority-owned subsidiary VMware. The current EMC president, Paul Moritz, will become chief strategist at the mother ship. In addition, EMC CFO Dave Goulden moves up to take Gelsinger's president and COO position, and chief marketing officer Jeremy Burton gets an executive VP title. Early this week, rumors were also flying about EMC/VMware spinning off Cloud Foundry and some of their other software products, which EMC is currently denying.
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From where I sit, this is another sign that EMC and VMware are really one company, despite the fact that the public owns some 15% of VMware. Future EMC CEOs will have to understand not just the storage business but also VMware's role in the company, and this may mean simply that Gelsinger is being groomed to replace Tucci. Frankly, the whole thing is less shocking then when EMC ousted VMware founder Diane Greene back in 2008 and put Maritz in her place.
I understand that VMware is critical to EMC's future and EMC executives have to understand VMware's business. I'm concerned, however, that moving executives from the storage software side may encourage VMware to build special features and undocumented APIs into its product sphere, the way the Windows group at Microsoft occasionally did to give the Office team a leg up.
I hope that I won't be reporting storage industry news from a dystopian future, where like the 1970s you have to choose a computing vendor and rely on it for all your hardware and software. Imagine if 10 years from now we report:
The beginning of the end was EMC's decision with vSphere X to limit the advanced storage features empowered by vVols, like per-VM snapshots and server-array SSD cache integration, to EMC storage. Soon, thereafter, Cisco merged with EMC and started offering 50% discounts on vBlocks, making the heterogeneous infrastructures of the '90s and '00s too expensive for many organizations to support.
The resulting balkanization and merger mania that saw the creation of HPsoft and Delltrix has resulted in a huge decline in private IT infrastructure spending, as companies decided that running HPsoft systems with Office and Exchange and separate IBM systems for SAP was more trouble than a massive shift to SAAS. We've seen system administrators standing on street corners, holding, "Will run Linux for food" signs.
To date, EMC and VMware have been pretty fair with competing storage vendors, making hooks into VMware for features like VMware API for Array Integration available to all. Hopefully, company leaders realize that 60% of the $10 billion market is better than all of the $3 billion market.