January 31, 2014

VMware's Results Show It Competing Well Despite Open Source Threats

 VMware reported its fourth quarter earnings yesterday, and what's remarkable is that despite a number of open source virtualization and cloud computing advancements that serve up free competition to VMware's products, the company continues to hold its ground. VMware reported fourth quarter 2013 revenue of $1.48 billion, up 15 percent year-over-year. For the full year, VMware revenue was $5.21 billion, up 13 percent over 2012, with net income of $1.01 billion. Some reports are even speculating about whether the company might be on a brand new growth path. 

VMware is the leading provider of virtualization software, allowing companies and users to run multiple software operating systems and apps concurrently, often saving on costs. All the way back in 2008, I produced a post noting that free and open source virtualization and cloud platforms were going to be serious threats to VMware. Virtualization is increasingly being improved in open source offerings, and it is always a precarious proposition for tech companies to depend on one product category as heavily as VMware has. Just ask the former employees of Netscape or Lotus about that.

 

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