Microsoft and VMware battle for the virtualisation market

VMware chief Paul Maritz is confident of taking on Microsoft

If there was one central theme to this week's VMworld 2009 conference it is that VMware is taking on Microsoft and isn't afraid of a fight.

It certainly used to be the case that, when Microsoft decided it wanted something, it usually got it. The company uses technological methods such as tying in the Internet Explorer browser, and business tactics by either giving away competitive software for free or suing the opposition into the ground.

VMware chief executive Paul Maritz knows exactly how the playbook is run. After all, he spent 14 years at Microsoft and saw first hand how the company gets what it wants. This might explain why he is sounding so confident about winning this battle.

Microsoft came late to the virtualisation market but immediately went on the attack. The company started giving away software and highlighting itself to the community. It was a key sponsor of VMworld 2008 and has been pushing itself to the virtualisation market players hard.

VMware responded this year by refusing Microsoft's money and limiting the company to a small stand at the exhibition that accompanies the show. While some at Redmond have complained to friends about the tactic, it's a little difficult to do so without sounding petty.

Meanwhile VMware is looking to make itself into essentially the Microsoft of the virtualised world. It has been demonstrating ways to link its internal clouds to outside providers and has signed up 1,000 partners.

The firm also has its talking points lined up on how to beat Microsoft and has a powerful argument. Microsoft has made Windows integral to its virtualisation offering because this gives it a powerful edge, so the playbook goes.

In fact, this decision could well be Microsoft's undoing. The company has underestimated quite how unpopular it is with datacentre managers, and the enduring security failings of Windows make many nervous. On the desktop you can put up with a certain amount of insecurity, but if someone hacks your datacentre running thousands of virtual machines the consequences are catastrophic.

VMware is also looking to use partners in its fight by treating them right. While the company won't reveal partnership terms, the enthusiasm with which key partners are treating the company suggests that VMware is prepared to accept a smaller cut of profits in exchange for loyalty.

Microsoft isn't the only company in VMware's sights, however. Citrix too was limited to a small booth at the show, after also having been a sponsor last year. VMware wants a slice of the Citrix thin client business and will be using the PC over IP system to attack Citrix's established business.

VMware is sounding very confident of its ability to wage war for the virtualisation market, and it is in a strong position. This is a battle that the company has to fight now. As time goes on its leadership in the field will shrink and, unless it establishes itself as the de facto standard now, it will become just another player in the field.