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Is VMware the new Tall Poppy?

Posted on Wednesday, August 10, 2011 | 6 Comments

Here in Australia we have this phrase called "The Tall Poppy Syndrome". It is the "social phenomenon in which people of genuine merit are resented, attacked, cut down, or criticised because their talents or achievements elevate them above or distinguish them from their peers."

Seeing a bit of the fallout of the VMware licensing for v5 I wondered if VMware were the new Microsoft and we felt that they just needed to be brought down a peg or two.

My view is that part of this is due to a cultural change in how Virtualization is used within organizations today. Back in the day VMware was used to remove other costs within a project, it helped drive the ROI. Due to consolidation, which was it's big use case, every dollar you spent on VMware licenses was saving you many other dollars on physical hardware. We would drive every cent out of that physical hardware but the VMware portion looked like good value for money.

In today's world we have moved onto new models. We have seen "virtual first" become standard (certainly in my region) and VMware be a standard base cost for doing IT. At the same time we have seen the base hypervisor become a commodity item. Therefore the hypervisor has become like all the other elements of a solution, people need to squeeze every spare cent out of it, just like their storage, networking and compute hardware. VMware has entered main stream and is being treated accordingly by consumers.

Yet to stay leader of the pack and continue to deliver the eco system of products and tools around the base hypervisor VMware need to recoup their costs and they are going to price accordingly.

My take on the pricing backlash is this is more about VMware being treated just like all the other products and vendors in the stack. The glory days of consolidation savings are over, it's now the new norm. Time to refresh the value prop and get used to the backlash no matter what they do, just like Microsoft.


P.S. First post from my new iPad. Maybe this might get me posting more.


  1. Anonymous12:35 pm

    Rodos - with MS breathing down their necks, it does rather look like a last grasp at the easier dollars, from a distance. Tall Poppy - maybe, but the sales teams are not as nice to everyone else as they are to you and maybe deserve some backlash.

  2. Yes, I am not arguing for or against the backlash, more thinking about what has occurred to make this happen, its certainly a change.

  3. Hi Rodney,

    I actually went on the defense of some aspects of the new licensing scheme for vSphere 5 and got about 200 e-mails from the community flaming me for doing so. In reality quite a few of these people were running the free version of ESXi with far too many VM's active and un-managed - which is never a good thing. The amount of people that were suddenly going to jump ship to Hyper-V or Zen was astounding... Fair enough the proposed changes were going to have an impact on some users and after a fairly public outcry VMware changed their model again and calmed the masses, which shows they are in tune with their user community and actually though about the potential problems they had created for some users. Try getting any of the other vendors to do that. I spent many years working in the Partner network architecting solutions for a vast customer base.

    I now work as a technical architect for private enterprise again so have control over the infrastructure and may now have a bit more leveraging power with Partner/Solution Providers. I found throughout the whole licensing issue that talking and communicating with VMware was by far the right thing to do - instead of pulling them to bits and touting the move to other software based hyper-visor providers (remember why you installed VMware in the first place...)

  4. Gary, nice to see some sanity.

  5. Rodos, this below is by far the best analysis I have found re what's going on.



  6. Anonymous9:55 am

    If there was no competition, I don't think VMware would have backed down. Enterprise+ caused quite a few large Enterprises with ELA's to give them a bloody nose and it didn't change (might have conceded to a few ELA's mind you). I think the fact people weighed up the economics of high consoldiation/cost with medium consolidation/cost, they genuinely decided they'd be worth at least exploring XenServer 6.0 when it hits. I think, those who were genuine still will at least check XS6.0 out - and a percentage will jump ship. moving to XS would be painful, but times right now, dictate we all have to cut our cloth accordingly - VMware misjudged the market, and a few customers will consider that VMware are prone to licensing changes that potentially kick you in the nuts. Tbh, I can't recall a MS change in licensing that was negative, they generally start from a bad place and slowly evolve (VECD --> VDA, for example), this mid-stream change of VMware's was ill-judged, and wsa too tight - it does smack of a grab for the low-hanging fruit (to coin a P2v phrase).

    The next vSphere release will be Per VM - how does that ultimately effect how IT operates? If you've not moved to Cloud, Chargeback and all that it encompasses, you'll feel the pain then, thats for sure.


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