Dell Technologies, Microsoft and VMware Extend Partnership in the Cloud



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Dell Technologies, VMware, and Microsoft are improving the synergy between their data center, work software, and cloud computing technologies.

The partnership, announced Monday at the Dell Las Vegas annual user conference, enables Microsoft's Azure cloud computing customers to use VMware's virtualization software to manage their IT operations in Azure.

This is similar to a 2016 agreement that allowed Amazon Web Services customers to use VMware software. The contracts are aimed at responding to the trend of companies using multiple cloud services as well as internal data centers for their business infrastructure, rather than just one external vendor. In industry jargon, this mixed configuration is called a "hybrid cloud".

In theory, customers will benefit from the partnership announced on Monday as it eliminates some of the additional coding required by multiple services. As companies increasingly use the products of many companies, many technology companies are increasingly making their products compatible with competing services for fear of losing sales.

The leaders involved in the transaction said Fortune they have been discussing for years the deepening of a pre-existing partnership between Microsoft and Dell, which was previously less focused on the role of VMware and more on personal computers and the Windows operating service. These discussions became more serious a few months ago, they said.

The latest deal concerns VMware, in which Dell holds a majority stake. Technical publication L & # 39; information announced in February that Microsoft and VMware were exploring a partnership in the cloud.

In 2017, Microsoft created a non-VMware-approved product that customers could use to run VMware virtualization software in Azure. VMware subsequently publicly criticized the product, citing alleged technical limitations resulting from a lack of involvement of VMware in product development.

Scott Guthrie, executive vice president of Microsoft's cloud computing unit, did not comment directly on this conflict. But in describing the last truce, he said that "there was a wide variety of technical discussions and support that we obviously needed to have for this to happen."

"It was a trip, but I think a trip that has resulted in a fantastic space," Guthrie said.

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Pat Gelsinger, CEO of VMware, explained that VMware customers are using more and more Azure, so it made sense for VMware to work with Microsoft to make their technologies more compatible.

"In simple terms, customers are asking us to do more together," said Gelsinger.

Once VMware had offered its customers its own cloud service, it had finally sold it to the European technology company OVH in 2017, after failing to gain a significant market share.

Matt Eastwood, senior vice president of research firm International Data Corporation, said Fortune in an email that VMware was looking to associate with more cloud providers in recent years.

"As the cloud has matured, it has become increasingly clear that enterprise customers want the multi-cloud (choice of choice)," said Eastwood. "Microsoft saw that this strategy worked for VMware and saw fewer reasons for not collaborating. In the end, it was just a matter of timing. "

Also as part of the Dell and Microsoft partnership, Dell has created a product that makes it easier for enterprise IT managers to set up employee computers with Microsoft Windows. A new VMware service, available later this year, works with Microsoft Office 365 tools and the Active Directory product that helps IT staff manage the devices and software that employees can access. Another new service involving Microsoft's Microsoft Virtual Desktop product will also be available later this year via a test version.

A Dell spokesman said Azure and VMware services are now available in the US and will expand in other regions in the coming months. Companies did not specify the cost of new services.

Whatever the case may be, Guthrie said the expanded partnership "is not just about what we will do on Monday." Rather, it is intended to indicate to customers that formerly rival companies are cooperating more than ever and that they are becoming more numerous.

In fact, in describing the partnership, Guthrie evoked it as a romance, claiming that he "really brought us together on a deeper level than ever before."

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