Could a VMware Spinoff Be in the Works?
A longstanding VMware (NYSE: VMW) spinoff rumor has surfaced again, with fresh reports that the vendor will spring Cloud Foundry, GemStone, SpringSource and perhaps other non-core businesses into a new venture owned by EMC (NYSE: EMC), which already owns 80 percent of VMware. According to the reports, VMware could announce the initiative as soon as sometime next week.
A VMware spinoff rumor isn’t new by any means, with the first version of this one appearing last July in reports that the virtualization kingpin would make an offshoot of Cloud Foundry and slot Paul Maritz, former VMware chief executive, into the top spot. The reasoning then, and now, is that a reshuffling of VMware’s properties would enable it to concentrate on its profitable vSphere cloud infrastructure platform, cloud management and virtualization enterprise businesses, and provide it with a suitable cloud services competitor to Google (NASDAQ: GOOG), Microsoft (NASDAQ: MSFT) and Amazon (NASDAQ: AMZN).
VMware launched Cloud Foundry in 2011, which, as an open platform-as-a-service (PaaS), is intended for developers to use to build, test, deploy and scale applications across a variety of private and public clouds. VMware’s SpringSource unit, which it purchased in August 2009, bought GemStone, a data management specialist, in May 2010.
Earlier speculation had VMware spinning off Cloud Foundry, EMC’s Big Data Greenplum and assets of Project Rubicon, an infrastructure-as-a-service co-venture between VMware and EMC, under a separate banner, perhaps headed by Tod Nielsen, co-president of VMware’s applications business. That deal went nowhere, that is, until maybe now, in a rearranged format, if reports are to be believed.
This latest report, citing unnamed sources, said Maritz and Robert Mee, former Pivotal Labs chief executive, will play key roles in the new business. EMC purchased the San Francisco-based Pivotal, an agile software development specialist, in March.
Should these rumors eventually come to pass, it’s unknown how, or if, it would affect channel partners, or what new opportunities the spinoff might bring. At this point, the best that can be said is it will have some promise for partners.
As for EMC spinning off VMware as a separate entity at some point–not that it’s an issue, the two companies pretty much march in lockstep to master Big Data, cloud computing, virtualization and security–but EMC chief Joe Tucci, when asked the question earlier this month, responded with a resounding, “never.”