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Gartner says: "VMware is zonked on enterprise dollars!"

Well that is what the Gartner thinks where VMware may get stuck in its boots. The same thing which I describe from my Puddle perspective. I think VMware will have to really work on the humbling down and getting to the little fellas and explaining the value of virtualization to one and all. There is still time!

"The enterprise is going to be very leery of Microsoft, but the on-ramp to VMware is a bit steep for small businesses. VMware doesn't want to lose that potential business, but the company was getting a bit drunk on enterprise dollars," says Thomas Bittman, Gartner vice president and distinguished analyst. "Microsoft could grab small businesses and grow up, and VMware should do anything it can do to get that market share, even if it costs revenue."

By packaging its hypervisor with a server release, Microsoft will gain access into many accounts -- except the adoption curve may mirror that of servers, which could hold Hyper-V back a bit, Bittman says. But overall industry watchers expect Hyper-V to take off with small customers.

"Any customer is liable to use Hyper-V. It is being packaged with Windows Server 2008, which makes it much easier to deploy than ESX Server," EMA's Mann says.

And once Hyper-V is in small shops, Microsoft will have the opportunity to sell its management capabilities and add-on products to those customers. "Microsoft has a history of coming in low and gaining market share," IDC's Elliot says.



  1. Don't you feel that VMware is competitive in both a pricing and performance perspective at the SMB level with Microsoft? ESX alone, without the enterprise features like VMotion and DRS which most SMB customers do not want to pay for comes in at $499 retail. When VMW can host 2-3 times as many VMs on the same physical hardware as MSFT... the total cost of ownership drops.

  2. VMware does a lot for SMB especially the SMB Acceleration Kits. The only thing that is missing is marketing...
    Small customers can buy the cheapest bundle for $2995 with 3 (2-Socket) ESX Foundation and one Virtual Center Foundation. It brings management and more functionality than other solutions. Also more VMs on the same physical Hardware than other solutions. Look here:

  3. Does SMB genuinely care about "2-3 times as many VMs"? I imagine OPEX isn't very high on SMB priorities. However I think SMB would be more interested in a GUI full of prebuilt wizards and bottom dollar.


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