VMware to offer ESXi hypervisor for free

Vendor is doing what it should have done when first releasing product, analyst says

VMware will offer the small-footprint version of its ESX virtualisation software free, responding to pressure from Microsoft and other companies that are threatening VMware's lead in the virtualisation market.

The next version of ESXi, to be released shortly, will be available at no cost, said VMware CEO Paul Maritz during a conference call on July 22 to discuss the company's second-quarter earnings. ESXi is a basic hypervisor, which is technology that separates the OS from server hardware so multiple OSes can run virtually on one physical server.

Maritz said the move to make the already low-cost product free is part of VMware's plan to make its virtualisation and network infrastructure products "as freely available to everyone in the industry" as possible as it diversifies its products beyond merely enabling virtualisation.

Bogomil Balkansky, VMware senior director of product marketing, says ESXi has all the capabilities of VMware's older ESX product, including support for advanced VMware infrastructure features like Vmotion, which allows a workload to be moved to another physical server while it is still being used.

"Functionally the two products are equivalent; ESXi does anything and everything ESX does," Balkansky says.

The reason VMware is making ESXi free and not ESX is because ESXi has the more modern architecture and is the product VMware wants customers to use moving forward, he says. ESXi uses an agentless model for management, which is why its footprint is so much smaller (at 32M bytes) than that of ESX, he says.

Tom Bittman, vice president and distinguished analyst with Gartner, says the move is significant. It will allow VMware to compete more effectively with Microsoft, which is bundling its Hyper-V virtualization software with high-end editions of Windows Server.

"This takes the price argument away," Bittman says.

Most companies now are buying other VMware products along with the hypervisor, which is why VMWare can afford to give ESXi away, he says. VMware should have made it free from the start, he says. "That was a mistake, and they are correcting it now."

Balkansky says "It makes sense for us to seed the market with a free product and expose a broader set of customers to VMware, being confident that they will take the next step and upgrade to our Virtual Infrastructure product".

VMware is facing some of its toughest competition yet as Microsoft and other companies seek to commoditize the core virtualisation technology on which VMware's business was built by offering it as part of the OS.

Speaking about his "alma mater" during the July 22 conference call, Maritz called Microsoft a "formidable" competitor, but "not an invincible" one.

(Martiz worked for Microsoft for many years before joining EMC via its acquisition of Pi Networks, a start-up he had been involved in. Earlier this month, Maritz replaced founding VMware CEO Diane Greene, in a sudden and controversial move).

"I know that Microsoft can afford to play a long waiting game," he said. However, in markets where another company already has a sizable lead -- such as VMware does in virtualisation -- it can be "really hard to catch [up] even for Microsoft," Maritz said.

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