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  • VMware (VMW -0.9%) gets cut to Hold by Deutsche's Nandan Amladi, who's worried about competition, billings growth, and execution. VMware's vSphere virtualization platform "continues to face pricing pressures from [Microsoft's] Hyper-V," and the rise of OpenStack is "driving up adoption" of Citrix's (CTXS) Xen virtualization software and the Linux-based KVM. Lastly, checks "indicate a fair amount of interest" in Microsoft's (MSFT) System Center management tools, which compete with parts of VMware's vCloud Suite. IDC estimates VMware's virtualization share fell to 56.8% in 2012, and Microsoft's rose to 27.5%. (cash flow guidance) (Craig-Hallum[View news story]
    BL58

    You are still confusing routers and switches. Switches create VLAN's within a data center. Network virtualization replaces hardware switches with software switches. In general both server virtualization and network virtualization do not have a large effect upon routers.
    Jun 5, 2013. 09:58 PM | Likes Like |Link to Comment
  • VMware (VMW -0.9%) gets cut to Hold by Deutsche's Nandan Amladi, who's worried about competition, billings growth, and execution. VMware's vSphere virtualization platform "continues to face pricing pressures from [Microsoft's] Hyper-V," and the rise of OpenStack is "driving up adoption" of Citrix's (CTXS) Xen virtualization software and the Linux-based KVM. Lastly, checks "indicate a fair amount of interest" in Microsoft's (MSFT) System Center management tools, which compete with parts of VMware's vCloud Suite. IDC estimates VMware's virtualization share fell to 56.8% in 2012, and Microsoft's rose to 27.5%. (cash flow guidance) (Craig-Hallum[View news story]
    1. Routers route network traffic between locations (between branch offices and HQ). Router sales are unaffected by virtualization.
    2) Switches move data between servers in a data center. When you virtualize 10 servers you make 9 physical servers and their network ports go away as all 10 of those servers end up running on one physical box. Virtualization software contains a software switch that moves the data between the virtual servers in one server. So when you turn 10 servers with two switch ports each (20 ports) into one servers with two switch ports, you make 18 switch ports go away.
    3) Network virtualization will accelerate this trend by allowing more of the configuration of the network to be done in software from VMware and Microsoft, reducing the role of the switch to a dumb mover of bits.

    So the combination of server virtualization and network virtualization mean that Cisco sells many fewer switch ports (and therefore switches), and more importantly commodity switches instead of expensive value added switches. This is why Cisco was so angry when VMware bought Nicira.
    Jun 5, 2013. 12:21 PM | 1 Like Like |Link to Comment
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