RTFM

Notes on VMWare's Special Shareholder Meeting

The word "virtualization" itself is a term that has largely meaningless because it means so many different things to so many people (other examples include "multimedia", "technology", and "cloud computing"). For details on "virtual machines" (the VM in VMware), the VMware homepage has a link to "get an intro to virtualization", but the one-phrase summary is that virtual machine technology lets you run virtual computers within your computer. Common motivations are to run different types of software apps or OSes, or consolidate multiple physical machines into one.

The "hypervisor" is the component that is getting commoditized, in part due to features being added to processors (which make it easier to write a hypervisor that works, but not necessary a good one). As with any software industry, it's a matter of establishing a lead over competitors and working to maintain that lead as they catchup to certain advantages. The lead is often defined in terms of features, but in this area also applies to performance, stability, correctness, ecosystem of complementing products, etc.

A competitor like Microsoft will only care to have their VM product run on their OS (i.e., Windows), and focus on making sure their OS will work well in their virtual machines (while not caring so much about other OSes like Linux or Solaris). It took MSFT 5 years after acquiring Connectix to ship a competitor to VMware's high-end hypervisor, and it still lacks important features (e.g., VMware's VMotion, which lets you transition from running a VM on one physical computer to running on another physical computer with sub-second downtime of that VM). Other aspects are subtle but important. For example, being able to take a VM that was running under one version of a VM product and then upgrade to a newer version of the VM product and still be able to use that VM without losing information. VMware generally allows you to do this, while MSFT has not so far (even between the RC and RTM versions of hyper-v). This gets to be a big deal with you have 1000s of VMs, which is also why more revenue is coming from other areas like management software than from the core hypervisor products.

In the Macintosh product space the competition is closer to VMware's heals, in part because VMware got a late start but also because the main competitor sacrificed quality and stability to get where they're at.

Notes on VMWare's Special Shareholder Meeting

I hope you don't intend to waste people's times at the annual stockholder meeting with such stupid questions. You're so clueless about the company you have no business covering it. I do admire your guts to publically humiliate yourself like this.