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In many cases, the end of the year gives you time to step back and take stock of the last 12 months. This is when many of us take a hard look at what worked and what did not, complete performance reviews, and formulate plans for the coming year. For me, it is all of those things plus a time when I u...
EMC to Acquire VMWare
EMC to Acquire VMWare

Storage giant EMC announced yesterday that it would acquire VMWare in a cash transaction valued at approximately $635 million.

VMWare is considered by many to be the leading technology for server consolidation on Intel-based server hardware and has enjoyed great success in the Linux community, so acquisition by EMC only adds to their future prospects as an important technology for Linux server adoption and integration into the enterprise.

The company's virtualization technology has garnered acclaim in the Linux community as a way to run both Microsoft Windows and Linux servers on the same hardware (as well as NetWare) - the ability to consolidate on the same server hardware being an important part of migration strategies for Windows and Linux users.

During EMC’s briefing on the acquisition, EMC’s CEO Joe Tucci stated the organization's goal was to “virtualize information structure” and feels that VMWare offers EMC not only to help virtualize the information structure but the server structure of the enterprise. Diane Greene, VMWare’s CEO, noted that VMWare has over 5000 server virtualization customers and over 2 million desktop virtualization customers. Currently desktop products account for less than 50% of their revenue with server revenues growing at a faster rate than desktops. When asked why EMC and VMWare make a good match, the companies commented that EMC gives VMWare to scale more quickly than on their own accord - and to also leverage EMC’s enterprise presence, worldwide sales force numbering 4500 and 7500 person customer services organization.

Besides setting the stage for server consolidation and improved utilization, VMWare has also enjoyed success as a way for Linux desktop users to run Windows operating systems on the same hardware. It remains to be seen whether EMC and VMWare will have any dedication to the desktop PC market as EMC is regarded as an enterprise software company focusing on the larger customer rather than the consumer or small business.

EMC indicates that VMWare with its approximately 370 employees will operate as a software subsidiary upon completion of the acquisition led by current VMWare chief, Diane Greene. Also it was noted that VMWare has been cash flow positive for the last two years and profitable since January 2003. The official announcement can be found at EMC’s website. The acquisition is subject to customary closing conditions and regulatory approvals, and the transaction is forecasted to be complete early in the first quarter of 2004.

About Mark R. Hinkle
Mark Hinkle is the Senior Director, Open Soure Solutions at Citrix. He also is along-time open source expert and advocate. He is a co-founder of both the Open Source Management Consortium and the Desktop Linux Consortium. He has served as Editor-in-Chief for both LinuxWorld Magazine and Enterprise Open Source Magazine. Hinkle is also the author of the book, "Windows to Linux Business Desktop Migration" (Thomson, 2006). His blog on open source, technology, and new media can be found at

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