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Why VMware Cloud on AWS Will Pay Off for VMware

Two years ago, VMware and AWS announced they were teaming up. At the time, it was a surprising move. Some industry experts questioned the partnership. Would it be a one-time collaboration effort? Or would it be a long-term partnership? More importantly, could VMware gain a foothold in the cloud?

It’s still early and there remains skepticism, but there are signs the partnership is working. Here’s a look at why VMware Cloud will prove lucrative for VMware in the long run.

An AWS-powered boost for VMware

Collaborating with AWS is huge for VMware. AWS is the undisputed industry leader in cloud computing. In return, VMware has been able to leverage its popular admin features with the vast availability and scalability of AWS.

The result is a cloud service that’s familiar to those who are used to local instances of VMware — with much of the same functionality. For example, deploying virtual machines to availability zones works the same way as locally installed instances of VMware. In such instances, VMware Cloud is essentially operating as a VMware software-defined data center.

Software-defined data centers (SDDC) are a necessity for most globally competitive companies. The need to reduce on-premises, physical hardware expenditure has become more crucial than ever. The partnership has provided many benefits to its users including:

Reduced CapEx. The pooling of computing, storage, and networking workloads drastically reduces service unit costs. This saves organizations from having to continually invest in their IT infrastructures. Using public clouds based on SDDC platforms, IT departments no longer need to own capacity for peak workload conditions.  

Automated application and infrastructure delivery. Traditionally, capacity planning and monitoring in data centers are done manually. Such tasks often are hampered by inconsistent configurations and lack of time — as IT staff reactively moves between projects. SDDCs provide unified platforms for intelligent operations across entire data centers, saving time and providing more stability.

Enhanced security. Virtual networks by default are isolated from each other in SDCCs. This helps protect them against attacks originating from workloads on other virtual networks. Isolating virtual networks allows security controls to be applied to individual virtual machines and smaller groups of virtualized resources.  

VMware Cloud on AWS can increase the robustness of operational capabilities, making orgs less vulnerable to disasters and downtime. It also creates cost savings. For example, it’s is far more economical to have a setup that a fully operational secondary site in the event of a Disaster Recovery instance.

Being able to leverage AWS’ powerful infrastructure is a huge win for VMware. They now offer a cloud solution built with its own technology — that rides on top of a cloud titan. This greatly strengthens VMware’s position in the competitive cloud market.

Early returns support strong future growth

Looking at the numbers, the partnership with AWS is paying off well for VMware. The company reported a revenue of over $2 billion dollars in Q1 2019, about a 14 percent increase from Q1 2018. And licensing revenue made up $774 million, for an increase of 21 percent from last year.

If the Q4 2018 and Q1 2019 results are any indication, the VMware-AWS partnership has promising growth. VMware Cloud on AWS Cloud’s annual revenue growth rate was over 30 percent in the 2018 fiscal year. This proves that more organizations are embracing the platform.

In May 2018, VMware announced that VMWare Cloud on AWS launched in Europe and that it now offers enhanced capabilities for its customers which will help to speed up cloud service adoption for its customers such as cloud migration and hybrid cloud deployments. Both of these moves should lead to more business for VMware.

Enterprise applications will increase demand

VMware Cloud on AWS presents a lot of opportunities for the enterprise. As more organizations realize its benefits, adoption of VMware will likely increase. This will help VMware establish credibility in the cloud space.

VMWare Cloud offers three main implementation scenarios. They are stand-alone installation, hybrid cloud solutions, and cloud-to-cloud deployments. All of these options offer greater redundancy, flexibility, and convenience. Plus, the management of the cloud systems is done via the same console layout. It is very familiar to who already use vSphere, vSAN, NSX, and other VMware tech.

Disaster Recovery as a Service (DRaaS) is another big drawcard for organizations that cannot afford any downtime. Having replication and added redundancy in the cloud ensures even the most disruptive IT failures can be handled seamlessly. VMware offers VMware Site Recovery, which gives customers the ability to deploy quickly, minimizing downtime and speeding up overall recovery times.

The technology has been built on VMware Site Recovery Manager and vSphere Replication and is managed through vCenter. It is quick to set up and boasts a DR protection readiness. The process is simplified and automated, for the most part, giving customers an easy-to-use product that is simple to deploy.

One of the biggest cost savings of VMware Cloud on AWS comes from reduced secondary site costs. Shared workload balancing can benefit companies greatly with VMware cloud solutions. The dynamic and fluctuating demands of an organization’s IT infrastructure can be leveraged. This allows for increased resource utilization from the cloud and local installations on an “as needed” basis.

These on-demand services allow IT pros to spin up hosts in the cloud with a few clicks within their management interface. These hosts are billed for by the hour and can be toggled off once they are no longer necessary.

Moving to VMware Cloud on AWS services also makes sense for organizations that are looking to downscale their existing datacenter installations or dispense with them altogether. Their datacenter requirements can be handled by the cloud, removing the need for onsite expertise across their operations.

As more organizations realize the benefits of the platform, the demand for VMware Cloud on AWS will increase. This should only further affirm its success and staying power.

The final verdict

Some were quick to say VMware Cloud on AWS couldn’t be easily marketed. However, that appears not to be the case. Adoption of the service is increasing year by year. Additional territories are being added.

And as organizations continue to decentralize their operations infrastructure by migrating key services to the cloud, the demand for VMware Cloud on AWS will only increase. For now, the VMware-AWS partnership is working smoothly — the initial risk is certainly starting to pay off for VMware.


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