VMware Focuses On Private Cloud, Dumps Unpopular Pricing

On day one of VMworld, VMware launches vCloud Suite for managing private cloud environments, backs OpenStack, and ditches vRAM-based pricing.
VMware is pushing deeper into private cloud computing, the company made clear as it kicked off its VMworld conference in San Francisco Monday.

The cornerstone of VMware's approach is a package of its core data center virtualization products integrated with vCloud Director. The new combination is dubbed vCloud Suite.

"In 2008, we asked ourselves what the hell is it?" recalled Paul Maritz of the early debate over cloud computing inside VMware. That was the state of cloud computing when he assumed the CEO's job from Diane Greene at VMware in July, 2008. Since then, the enterprise data center has gone from 25% virtualized to 60%, according to Gartner.

VMware wants to push the total closer to 90%, said Maritz during the opening keynote Monday. EMC announced July 17 that Maritz was assuming a new role as chief strategy officer with EMC, VMware's parent company. Pat Gelsinger, EMC president, will step in as VMware CEO.

The actual transition will take place Sept. 1, but for VMworld purposes, the transfer of power took place after Maritz introduced his "old friend" Pat Gelsinger, with whom he worked 30 years earlier at Intel, as the incoming VMware CEO.

Gelsinger, switching jobs from president of EMC, called for and got a prolonged round of applause for Maritz as he left the stage.

"This is a period of great disruption in the industry," said Gelsinger. "It will be exciting to finish the job and get to 90%," he said.

[ Want to learn more about VMware's competitive position? See Maritz' VMware Legacy Defied Doubters ]

To reach that 90% virtualized mark, VMware thinks many companies will adopt the more automated management and provisioning services of private cloud computing, which is where its vCloud Suite fits.

The suite will have to compete with cloud pure play vendors such as Eucalyptus Systems and Citrix Systems open source-based CloudStack. There is a new round of cloud vendors emerging, such as Piston and Nebula, basing their own private cloud suites on OpenStack open source code. VMware has been a virtualization vendor with cloud products, until now. With the vCloud Suite, it's bringing its main product line into its cloud product line and promising to make the vCloud the future focus of data center organization.

VMware Backs OpenStack

At the same time, in a surprise move, VMware became a member of OpenStack. It needed to embrace OpenStack, as its deal to acquire Nicira, a software-defined networking vendor, closed at the end of day Friday. Nicira has been a key contributor to OpenStack, building out its vendor neutral, Quantum virtualized network framework.

Observers weren't sure whether VMware planned to make Nicira's technology more proprietary, like the rest of VMware's product line, or reach out to the open source community. Joining OpenStack is VMware's definitive answer that it will support OpenStack's neutral framework.

VMware has been working for 18 months on its own neutral framework for communications within and between its vSphere operating environments, called vXLAN. VMware could have decided to use Nicira's expertise in software-defined networking to build out vXLAN further.

Instead, said Bogomil Balkansky, senior VP of cloud infrastructure, in an interview, VMware will support Nicira's work at OpenStack and use the Nicira approach to create the means to connect non-VMware clouds and networks to VMware-based private clouds.

"It's the first holistic approach for delivering cloud infrastructure," said Gelsinger in his keynote.

That's more true for the "already-VMware" part of the data center then a typical mixed environment, but VMware is moving toward an ability to deal with a variety of hypervisors and networked virtual machines in its approach to the software-defined data center.

OpenStack implementers tend to be users of the open source KVM hypervisor. If VMware is going to be able to interoperate with non-VMware segments of the data center, it will need more cross-hypervisor capabilities. Its recent acquisition of DynamicOps was a step in that direction, Gelsinger acknowledged during his keynote.

Goodbye vRAM-Based Pricing

Gelsinger also announced that VMware was doing away with the virtual resource-based, vRAM pricing introduced in July of last year. Customers of vSphere 5 were going to be charged for a vSphere license for each 48 GB (later changed to 96 GB) of virtual RAM they assigned to their virtual machines on a single server. With processors per server becoming able to host more VMs, many customers saw the vRAM pricing approach as a way to increase the number of vSphere licenses that they needed to buy.

At VMworld last year in Las Vegas, Microsoft representatives slyly referred to pricing based on vRAM resource use "the VMware vtax," and said Microsoft would keep its pricing based on CPU count.

Gelsinger announced Monday that VMware was done trying to use the virtual resource price measure and would go back to basing pricing on a per CPU basis.

"We're killing off the vRAM pricing. It's the wrong model," said Gelsinger to cheers from the audience. Maritz acknowledged in a briefing after the keynotes that eliminating vRAM pricing "was an admission that we had made things overly complex. In effect, mea culpa."

Gelsinger said VMware would remain an independent company, despite the exchange of executives between VMware and EMC. All the reasons that prompted EMC to keep VMware independent still applied, he said, including compensation of its executives, and leaving it a free hand to build out an independent ecosystem of third party vendors.

Included in the newly launched vCloud Suite 5.1, available Sept. 11, will be:

--VMware vSphere 5.1, the core virtual machine creation and management system. The new release includes the ability to use live migration or vMotion across server racks that do not necessarily have shared storage.

-- vCloud Director, a software product for creating a virtual data center, with compute, storage and networking, much as vSphere is a product for generating, configuring, and deploying a virtual machine. A virtual data center may span multiple vSphere server clusters and run up to 30,000 virtual machines. CTO Steve Herrod followed Gelsinger's keynote with a demonstration of a virtual data center being created from a check box list, much as a single virtual machine was previously created under vSphere.

--vCloud Networking and Security 5.1 allows the creation of secure, virtual networks for each VM or tenant on a multitenant server. VMware's new vXLAN capability has been included, which allows an IP and network MAC address to follow the virtual machine when it's moved, provided virtualization administrators have generated a pool of top-of-rack network switches.

VMotion was previously limited to movements within a server rack using the same storage file system. With vXLAN capability added, the network's switches can be virtualized and used to move virtual machines across server racks and storage systems; because the VMs keep their IP and MAC addresses, the VMs in a new location work with databases and other dependencies as they did before, but the new resources on which they're located act as an extension of the original data center rack.

--vCenter Site Recovery Manager 5.1, to ensure the availability or recovery of applications running in a virtual data center.

VCloud Suite will come in standard, advanced and enterprise versions. Standard pricing is $5,000 per CPU; Advanced will be $7,500; and Enterprise will be $11,495.

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