VMware is widely considered one of the top enterprise software companies, known primarily for its virtualization technologies and cloud computing platforms. Since being founded in 1998, VMware has become a leader in the development and application of virtualization software, helping drive adoption of virtual infrastructure in the data center.
A pioneer in virtualization and software-defined data centers
VMware was one of the first companies to successfully commercialize virtualization for x86 systems, introducing their initial product VMware Workstation in 1999. This allowed multiple operating systems to run in virtual environments on a single physical server or PC.
Over the next several years, VMware expanded their offerings to include VMware ESX Server and later vSphere for virtualizing enterprise data center operations. They were instrumental in popularizing the concept of the “software-defined data center”, allowing IT resources to be delivered programmatically through virtualization software.
- 1999 – First desktop virtualization product Workstation launched
- 2001 – Server product VMware GSX Server launched
- 2004 – VMware ESX Server product for data centers launched
- 2007 – VMware launches first vSphere platform for cloud infrastructure
- 2016 – vSphere integrated with VMware NSX network virtualization
By pioneering x86 virtualization and software-defined infrastructure, VMware enabled organizations to run traditional and cloud-native applications side-by-side, forming the foundation for hybrid cloud capabilities.
Dominant position in virtualization and cloud infrastructure
Over two decades, VMware has maintained a dominant position in virtualization software and systems infrastructure and management.
VMware vSphere hypervisor holds a significant 80% share of the hypervisor market supporting virtual servers in hardware infrastructure. The company has leveraged its base in vSphere to expand into providing a unified hybrid cloud platform via its VMware Cloud Foundation.
Key stats on VMware adoption:
- 500,000+ customers
- 75+ million VMs deployed
- 90% of Fortune 500 companies use VMware
Additionally, VMware’s infrastructure monitoring and automation software vRealize Suite and network virtualization platform VMware NSX have 30%+ market share in their respective categories.
VMware Cloud Provider Platform enables over 4,300+ cloud providers to offer VMware-based environments. The reach of VMware technology is vast, indicating their solutions have become commonplace in organizations moving to virtualized data centers and hybrid clouds.
Recent growth into multi-cloud and subscription based offerings
While VMware made its name in on-premises virtualization, it has focused over the past decade on cloud computing and enabling multi-cloud capabilities.
VMware Cloud allows enterprises to manage infrastructure and apps across all major public clouds including AWS, Azure, and Google Cloud via common APIs and networking. Its software-defined data center stack has evolved into the VMware Cloud Foundation platform now offered as SaaS via partnerships.
Key launches demonstrating VMware’s cloud growth:
- 2013 – vCloud Hybrid Service launched
- 2016 – Cloud Foundation SDDC stack launched
- 2018 – VMware on AWS partnership began
- 2019 – Acquisition of Kubernetes startup Heptio
- 2022 – Introduced VMware Sovereign Cloud initiative
In recent years VMware has also shifted towards subscription and SaaS for many of its offerings, accelerating the company’s revenue growth. As of Q3 2023, over 50% of VMware revenue comes from subscriptions.
The company’s increased focus on enabling hybrid and multi-cloud deployments combined with transition to subscription pricing has put VMware squarely among top cloud infrastructure vendors beside AWS and Microsoft.
Competitive position remains strong due to enterprise customer base
Despite increasing competition from hyperscale cloud providers, VMware retains a strong position particularly among enterprise customers it has long standing relationships with. Industries like financial services, healthcare, and government rely extensively on mission-critical VMware virtualization infrastructure unlikely to be replaced soon.
Additionally, rivals struggle to match the hybrid capabilities between on-prem and cloud resources that VMware software enables. Competing proprietary cloud platforms tend to lock customers into single vendor stacks. VMware’s Switzerland-like neutrality across cloud vendors makes it appealing for those pursuing multi-vendor hybrid cloud.
VMware is investing heavily in supporting app modernization, Kubernetes orchestration, and cloud native development, opening opportunities to grow with existing customers as they transform legacy apps. Deep integration between vSphere servers used by enterprises and VMware’s Tanzu platform gives the company a head start with these customers.
More acquisitions expected to expand capabilities
VMware has a long history of making strategic acquisitions to obtain technology talent and offerings complementary to its core virtualization business.
In recent years, its more notable acquisitions include:
- Heptio (2018) – Added Kubernetes container orchestration capabilities
- Pivotal Software (2019) – Expanded cloud native development talent and platform
- Datrium (2020) – Added disaster recovery and backup tools
- Mesh7 (2021) – Gained cloud security posture management
Industry analysts anticipate VMware will continue deals to fill gaps in multi-cloud management, app modernization, networking, and security. Potential acquisition targets include smaller startups offering innovative solutions customers demand as they transition legacy VMware environments to modern hybrid clouds.
- VMware pioneered data center and infrastructure virtualization, now a $50B+ market
- vSphere hypervisor and SDDC stack hold dominant 80%+ market share
- Over 75 million VMs deployed by 500k+ VMware customers
- Recent focus on multi-cloud, subscriptions expanding growth
- Core enterprise customer base gives sustainability amid competition
- Acquisitions likely to continue adding capabilities
So while VMware faces competition from pure-play cloud vendors, its position embedded in enterprise IT environments ensures it remains a top technology vendor enabling organizations to leverage hybrid and multi-cloud.
VMware’s foundational technology of x86 virtualization serves as backbone for modern software-defined data centers making hybrid cloud possible. After revolutionizing data center infrastructure and management over the past two decades, VMware has maintained market leadership despite increasing clouds from AWS, Microsoft and others. Its new directions into multi-cloud, Kubernetes, and subscription offerings display VMware’s ability to adapt to a changing IT landscape. Given its continued dominance among enterprises and the strategic value its technologies offer, VMware remains in the elite ranks of top enterprise technology companies relevant for decades to come.
Frequently Asked Questions
Q: How big is VMware in terms of revenue and market value?
A: As of end of 2022, VMware reported over $13 billion in annual revenue and has a market cap of around $50 billion, making it one of the biggest enterprise software companies.
Q: Does VMware offer any cloud computing services?
A: Yes, VMware operates its own cloud platform called VMware Cloud in addition to having close partnerships with all major public cloud providers like AWS, Azure, and Google Cloud. It offers hybrid and multi-cloud solutions.
Q: Who are VMware’s main competitors?
A: Major competitors include pureplay cloud infrastructure vendors like AWS and Microsoft Azure, as well as legacy virtualization vendors like Citrix. Red Hat and OpenStack also compete in open source virtualization.
Q: Is VMware owned by any other large tech company?
A: After being publicly traded for many years, in late 2022 VMware announced it is being acquired by semiconductor company Broadcom in a $61 billion deal expected to close in 2023.
Q: Does VMware offer only data center virtualization?
A: No, VMware has expanded over the years into cloud infrastructure, modern apps, networking and security. But data center virtualization remains core part of its offerings.
Q: What companies use VMware enterprise solutions?
A: Over 500,000 global customers use VMware including 90% of the Fortune 500 like Delta Airlines, FedEx, Home Depot and Nestle.
Q: Is VMware switching focus from on-prem solutions to the cloud?
A: VMware now offers both on-premises and native cloud solutions focused on enabling hybrid cloud environments. It aims to be cloud neutral supporting all major public clouds.
Q: How does VMware’s pricing model work?
A: Historically VMware used perpetual licensing but has shifted over 50% of revenue to subscriptions and SaaS. Customers can pay as they go for more flexible consumption.
Q: Is VMware easy for IT teams to manage?
A: Yes, VMware aims to provide simple yet powerful tools for managing hybrid infrastructure. The vCenter and vRealize suites centralize visibility and automation.
Q: Does VMware have security and disaster recovery capabilities?
A: Yes, VMware has a broad security portfolio spanning network security to endpoint. Site recovery manager and backup tools like Datrium are built for disaster recovery.
Q: What is VMware’s main virtualization product offering?
A: VMware vSphere is the company’s flagship hypervisor and virtualization platform used widely in enterprise data centers.
Q: Does VMware support Linux and open source software?
A: Yes, VMware adoption of Linux and open source software like Kubernetes has expanded greatly in recent years. Acquisitions like Heptio brought more open source talent.
Q: Where is VMware headquartered?
A: VMware global headquarters is located in Palo Alto, California with major offices in Asia and Europe.
Q: How many employees does VMware have?
A: As of late 2022, VMware employs over 40,000 workers globally.
Q: Who is CEO of VMware currently?
A: The current CEO is Rangarajan (Raghu) Raghuram, who previously held various executive roles at VMware before taking over as CEO in mid 2021.
Q: Does VMware offer consulting and professional services?
A: Yes. In addition to software licenses and subscriptions, VMware has professional services teams to provide technical guidance, design, implementation, and training services around its solutions.
Q: What is VMware’s company culture like?
A: VMware is known for having an innovative company culture that balances fast paced with collaboration. Employee rating sites often rank it highly among tech firms in areas like work/life balance.