VMware’s Deals With Mesosphere, Pivotal, Juniper, TradeStation

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Virtualization provider VMware (NYSE:VMW) announced large-scale deals with networking giant Juniper Networks (NYSE:JNPR), online brokerage TradeStation and tech startup Mesosphere in late November and early December. These deals should strengthen its product sales and aid its plans to expand internationally in the coming quarters. VMware’s Juniper deal revolves around the software-defined networking (SDN) domain, as both companies intend to partner in developing products, marketing and sales to deliver interoperable products involving Juniper’s MetaFabric data center architecture in combination with VMware’s NSX network virtualization platform. The deal with TradeStation enables the brokerage to deploy a software-defined data center (SDDC) using VMware and OpenStack technologies. Mesosphere is a startup that recently launched a data center operating system. VMware’s collaboration with Mesosphere and Pivotal involves streamlining cluster management from traditional data centers to the cloud. Below we take a closer look at these deals and their impact on VMware.

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Docker, Google, Pivotal And Mesosphere

VMware penned collaborative deals with open-source platform Docker, Google-owned (NASDAQ:GOOG) initiative Kubernetes, Mesosphere and Pivotal Cloud Foundry (partially owned VMware) to streamline migration from data centers to the cloud. The Docker platform uses containers that use shared operating systems and sit on top of single Linux instances, thereby making them more efficient to use than virtual machines (VM) offered by virtualization providers such as VMware or Citrix. Additionally, containers use far less system resources than entire virtual machines on a virtualization platform. As a result, the Docker 1.0 has gained popularity since its launch in June of this year. [1] Although containers could appear to be threatening to VMware’s business, VMware’s management announced that it will work with Docker, in addition to Google and Pivotal, to integrate Docker containers on its virtualization platform. [2] The result could be VMware releasing its own containers, compatible on its platform in addition to the existing VM architecture.

Tech venture Mesosphere recently announced the launch of its Data Center Operating System (DCOS), an operating system which (as the name suggests) is specifically developed for usage in data centers. DCOS pools in all available resources in a data center and centralizes operations. The startup received $36 million in series B funding from a number of prominent investors including Andreessen Horowitz, SV Angel, Fuel Capital and Khosla Ventures. [3] Through the recent deal involving Docker and Mesosphere, VMware intends to integrate the container deployment and cluster management from existing data center architecture to the cloud. The common platform will enable Docker containers to be deployed within VMs using vSphere, VMware Cloud Air (previously vCloud Hybrid Service) and VMware Fusion software. [4]

TradeStation

In early December, VMware announced a deal with online brokerage firm TradeStation, which will deploy a software-defined data center using VMware’s Integrated OpenStack solution. Additionally, the brokerage will use VMware’s flagship hypervisor vSphere and SDN platform NSX using OpenStack. [5] VMware’s Integrated OpenStack solution helps IT teams to efficiently manage cloud deployments and access VMware infrastructure through open-source application programming interfaces (APIs). This basically means that enterprise customers can have access to their own private clouds with the ease and convenience of accessing public clouds. As a result, the cloud deployment is secure and on-premise with the benefits of public and freely available cloud services. [6] TradeStation will deploy VMware’s private cloud offering to help it deliver applications faster to its wide range of active customers on its trading interface. The brokerage said that VMware’s private cloud deployment is “developer friendly” and offers the enterprise-grade security required in its business.

Juniper Networks

VMware has expanded its partnership with Juniper in the virtualization and software-defined networking (SDN) domain. Both companies will provide combined platform capabilities to enterprises in the Asia-Pacific region to build private cloud environments. The collaboration will involve both companies partnering in product development, marketing  and sales, and builds on their recent partnership to deliver interoperable products. These interoperable products involve integrating Juniper’s MetaFabric data center architecture with VMware’s NSX network virtualization platform, leveraging Juniper’s portfolio of switches, routers and security hardware with VMware’s virtualization software in the SDN domain.

Juniper announced the launch of its vMX 3D Universal Edge Router in November, to compete with rival Cisco’s (NASDAQ:CSCO) 1000v Cloud Services Router and Brocade’s Vyatta range of products. [7] The vMX 3D router is the virtualized version of Juniper’s existing MX Series 3D routers, using its network functions virtualization (NFV) platform called Contrail Cloud, which helps integrate the virtualization of storage, server and network.

Where SDN owes its origins to the need for centralizing control in networks, NFV consolidates various networking devices which are already deployed, into industry grade high-volume switches or servers. SDN enables various networking approaches to function without the need to change/update the software in every networking device. As a result, network admins can program the entire network on a unified interface and the “smart network” can reconfigure itself based on traffic demands. [8] Using this basic principle, SDN can be scaled up to the data center level and consequently used as an integral part of the software-defined data center (SDDC). On the other hand, using NFV helps reduce the capital expenditures, operating expenses, space and power consumption for the network managing team. Both these facets of networking (SDN and NFV) are actually complementary to each other rather than an either-or scenario. [9] Using the compatible NFV and SDN technologies, Juniper and VMware intend to leverage the existing data center capabilities to build private clouds in the Asia-Pacific region.

VMware’s international growth in 2014 thus far has been slower than the revenue growth in the U.S. VMware’s domestic product and services combined grew by over 19% y-o-y in the first three quarters of 2014, with international revenues growing by only 14%. The company penned deals with China Telecom (NYSE:CHA) and Japanese telecom provider SoftBank back in August, to expand its international presence in the hybrid cloud market. Furthermore, VMware added its fourth worldwide data center in England in July, to cater to the growing demand for hybrid cloud service in Europe, particularly in the U.K. With the Juniper deal under its belt, coupled with the other global deals across Asia and Europe, VMware could witness strong international growth in the coming quarters.

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Notes:
  1. What is Docker and why is it so darn popular?, ZD Net, August 2014 []
  2. VMware Teams With Docker, Google and Pivotal to Simplify Enterprise Adoption of Containers, VMware Press Release, August 2014 []
  3. Mesosphere Raises $36M, Launches Its Data Center Operating System, Forbes, December 2014 []
  4. VMware Streamlines Enterprise Container Deployment and Cluster Management From Data Center to Cloud, VMware Press Release, December 2014 []
  5. TradeStation Deploys OpenStack on VMware Infrastructure to Transition to a New Model of IT, VMware Press Release, December 2014 []
  6. VMware Infrastructure: The Best Foundation for OpenStack Clouds, VMware Blog, August 2014 []
  7. Juniper’s MX Router Goes Virtual, SDN Central, November 2014 []
  8. Understanding How SDN and NFV Can Work Together, Network World, January 2014 []
  9. The Battle Between SDN And NFV Networking That Never Was, Forbes, August 2013 []