Is VMware Building Bridge To Rival Amazon's Cloud?

At VMware's partner conference last month, CEO Pat Gelsinger said in a private question-and-answer session that his company is developing a way to move workloads back and forth between its vCloud Air public cloud and Amazon Web Services, according to partners who were there.

This would be significant for a number of reasons, but mainly because moving workloads between different clouds is a notoriously slow and tedious process, one that involves converting virtual machines between different formats and accounting for their networking and storage configurations, among other challenges.

VMware has previously warned customers that once they move workloads to AWS, its proprietary APIs and management dependencies make it difficult to move them out. It wasn't long ago that Gelsinger was telling partners that if "a workload goes to Amazon, you lose, and we have lost forever."

AWS doesn't let customers export virtual machines they create on its cloud, only ones they've previously imported, and some VMware partners feel this adds to the challenge of cross-cloud workload portability. Plus, AWS runs on the Xen server hypervisor, which isn't compatible with VMware's ESX hypervisor.

"VMware and AWS hypervisors are black and white, which is why everything that goes into AWS has to be imported and exported," said one solution provider executive who works with both vendors and requested anonymity to protect these relationships. "AWS provides a nice tool to do that, but workloads still aren't portable whatsoever."

Gelsinger didn't explain to partners what VMware is cooking up, but he did say VMware intends to make an announcement in the second calendar quarter that will shed more light on its plans. VMware and AWS spokespeople declined comment.

Building a bridge to AWS would also mark an important shift in VMware's approach to competing in the public cloud market, where it's trailing AWS and everyone else by a wide margin due to its late entry to the space. VMware was also slow to roll out features to vCloud Air that are table stakes in the cloud market, such as pay-as-you-go pricing and letting customers sign up using a credit card.

To pull this off, several VMware partners told CRN they believe the Palo Alto, Calif.-based vendor will partner closely with -- or acquire -- a firm that specializes in cross-cloud workload migrations.

RiverMeadow, a San Jose, Calif.-based firm that touts its ability to move "large, complex workloads into and between cloud environments" on its website, is one vendor VMware partners are keeping an eye on. RiverMeadow is a VMware partner and does cloud migrations for its customers.

RiverMeadow sells a cloud migration SaaS service that uses a proprietary technology called Secure Direction Migration, which automates the process of moving workloads into and between different cloud platforms behind the firewall, Scott Colgan, vice president of marketing, said in a recent interview.

Colgan said RiverMeadow goes to market exclusively through OEMs and was initially focused on the cloud service provider market, but now includes enterprises and SMBs.

Through its channel partnerships, RiverMeadow has seen a rapid increase in enterprise and SMB companies' cloud migration activity, some of which are looking to migrate workloads out of AWS, Colgan said.

One of RiverMeadow's closest partners is Cisco Systems, Colgan said. RiverMeadow is part of the Cisco Powered public cloud ecosystem, and its technology complements Cisco's Intercloud strategy by allowing workloads to be moved to private clouds, where they can connect to its Intercloud fabric, said Colgan.

Cisco is also a primary investor in RiverMeadow, which has raised $17 million since its founding in 2009.

Colgan wouldn't comment on whether RiverMeadow has been approached by VMware's M&A team, but offered the following statement:

"RiverMeadow is an equity-financed company looking to maximize shareholder value. We believe we have built a high-value solution that represents opportunity for companies looking to build services across clouds or to a given company looking to extend the value of its own cloud."

NEXT: vRealize Suite’s Selling Points

The other big part of VMware's workload portability strategy is vRealize Suite, a bundle of cloud management tools it used to sell separately. It includes vCloud Automation Center, which allows automated provisioning of virtual machines and physical servers and comes from VMware's 2012 acquisition of DynamicOps.

One of VMware's key selling points for vRealize Suite is that customers manage workloads running on its own vCloud Air public cloud, as well as other service providers' clouds, including AWS. VMware had a booth at the AWS Re:Invent conference last November that focused on vRealize Suite.

"VMware is now looking at vRealize Suite as the one tool to do it all: private, public, hybrid and automation for self-service," said Jamie Shepard, senior vice president of strategy and health care at Lumenate, a Dallas-based VMware partner. "This way, VMware customers will be able to control a secure flow of data, machines and resources without impact to performance or compliance service level agreements."

Some VMware customers that use vCloud Air still have development teams that use AWS, which is part of the "shadow IT" conundrum that many of them are grappling with. It's also part of the reason why VMware used to be so freaked out about customers defecting to AWS.

With vRealize Suite, used in conjunction with RiverMeadow, VMware could solve this problem for customers, according to Shepard.

"They could use RiverMeadow to move both physical and virtual workloads to any cloud, including AWS. VMware would be giving control back to the IT admin teams, providing options for both physical and virtual, without compromising the efforts of the development teams," said Shepard.

VMware, which has struggled to automate cloud service provisioning and billing, funded an internal project last year aimed at solving these issues with a subscription-based billing service, sources familiar with the project told CRN.

VMware also wanted to act as a broker of services to AWS and other cloud vendors, the sources said. But the project appears to have fizzled, and the VMware executives that were leading it have left the company, said the sources, who all requested anonymity because they're not authorized to discuss the project.

Although the project didn't work out, one of the sources told CRN VMware has now figured out that having management and workload portability options for customers could be a competitive differentiator, which is why it's focusing on doing this with AWS.

"I don't want to sign a contract with a cloud provider and then do management, monitoring and metering -- it's too much to handle," said the source. "If I'm a big VMware customer and could get this all wrapped into vRealize Suite, along with my VMware licenses, I'd be happy."

VMware has hinted at making its workloads portable to AWS. At a Gartner conference in August 2013, analyst Chris Wolf -- who's now CTO of VMware's Americas business -- asked VMware Executive Vice President Raghu Raghuram why VMware wasn't working with AWS to allow "seamless workflow" between their clouds.

"How do you know we're not working closely with them?" Raghuram replied, as reported by Gigaom.

VMware may also be working with other cloud vendors -- including Google, its new ally in the cloud space -- on enabling workload portability using vRealize.

VMware and Google unveiled a partnership last month in which vCloud Air customers will be able to use Google object storage and developer-focused services on a pay-as-you-go basis and pay for it on their VMware bill.

VMware and Google are also "exploring extended management support" for Google Cloud Platform in vRealize Suite, the vendors said in a press release at the time.

At the partner conference earlier this month, Gelsinger said the Google partnership is one of many that VMware will look to form to augment vCloud Air's capabilities.

VMware has plenty of competitive motivation to allow workloads from competing clouds to move to and from vCloud Air. Cisco, which is out to crush VMware in software-defined networking, has made workload portability a central piece of its Intercloud strategy and is already working with AWS, Microsoft and many other cloud vendors.

Intercloud works with vCloud Air too, but given the simmering tensions between Cisco and VMware, that doesn't seem like it'll be a huge use case, partners told CRN.

NEXT: Cross-Cloud Workload Portability

One industry executive, who spoke on condition of anonymity to protect his vendor relationships, said the push toward cross-cloud workload portability is a trend that's certain to continue.

"All the enterprise customers I talk to are pushing all the big cloud providers for easy interoperability and inter-cloud migration," said the source. "No one wants a single platform lock-in, and supplier diversity is essential for large-scale adoption above the SMB segment. So sooner or later the major players will have to figure something out."

"We see customers that want to go to the cloud and have multiple choices based upon the workload,’ said Aaron Stone, CEO of Netelligent, a Chesterfield, Mo.-based solution provider that partners with a range of enterprise vendors.

Netelligent's customers can leverage its own data centers and a variety of clouds for other workloads, such as test and development or highly scalable apps, said Stone. "Having the connection between these data centers can help with migration and extending security and policies beyond the border of one environment," he said.

Eric Hartley, president of Bluetowne, a Mount Pleasant, S.C.-based consulting firm that partners with VMware and other enterprise vendors, said being able to move workloads between clouds is an important part of his company's future strategy.

"It looks like all the big vendors are cozying up to one another. They know over the next 10 years or so, regardless of consolidation, that they will all need to play well together in the data center," Hartley said.

VMware isn't cozying up to AWS, however. In addition to highlighting vRealize Suite, it's also planning to continue to draw attention to the costs involved with running production workloads on AWS, Gelsinger told partners at the conference.

Several partners told CRN they believe the cost issue often gets overlooked by customers because of AWS' constant price cuts.

Last June, Amazon launched AWS Management Portal for vCenter, a tool that lets VMware admins manage virtual machines running on EC2 through the same software and interface they use to manage VMs on private clouds.

VMware wasn't too happy about that, but if its plan for moving workloads back and forth to AWS ends up being popular with customers, the vendor could show it's able to solve a problem that could move the entire cloud market forward.

PUBLISHED MARCH 2, 2015