VMware made a name for itself with the advent of virtual machines (VMs), but the company hasn’t been resting on its laurels. VMware reported after the closing bell yesterday that its fourth-quarter fiscal 2019 revenues grew 16% year over year. And its full year fiscal 2019 revenues increased 14%.
A couple of years ago, VMware expanded its ecosystem to not only focus on enterprise data centers, but to also target the telecom market and help telcos create clouds that looked like the big hyperscale clouds. VMware CEO Pat Gelsinger said in early 2017, “In the telco space, they largely run un-virtualized infrastructure. The size of the telco market is similar to the data center market. And it’s almost virgin territory … for us to pursue.”
One of the things VMware has done since then is to partner with Amazon Web Services to create the VMware Cloud on AWS. This allows customers to connect their workloads on AWS’ public cloud with their workloads on their VMware private clouds. On yesterday’s earnings call with investors, Gelsinger said, “This idea that I can now move to the cloud, create a unique hybrid cloud experience that doesn’t require me to change my applications, … I mean this is just game changing for customers.”
Gelsinger also mentioned AWS Outposts on yesterday’s call. Outposts can be thought of as the other side of the coin compared to VMware Cloud on AWS. With Outposts, customers can bring AWS hardware to their private, on-premises data centers. The Outposts hardware is the same kind of hardware that AWS uses in its own data centers.
On the fourth-quarter 2019 earnings call, Gelsinger said, “We do see the Amazon relationship as unique, right, as we’ve described that’s a preferred relationship: the number one public with the number one private. And the momentum that we’re seeing as we invest and partner with each other is getting a great benefit for us mutually in the marketplace.”
The 5G telco cloud
VMware is also planning to play a role in helping mobile carriers transition to 5G by helping them build their telco clouds. For instance, it is helping Vodafone build its telco cloud, which will run 5G workloads, among other workloads. Vodafone now has VMware running in 15 countries out of its 22-country footprint. And VMware says it is now working with more than 70 operators on 120-plus production implementations.
Although he predicts that “5G is a 2020 phenomenon,” Gelsinger said, “The handsets are there, the spectrum is being allocated, the core infrastructure solutions are starting to be available. We are the way that you can build the telco cloud. And instead of having these bespoke vertical infrastructure solutions like you have for 3G, 4G, LTE, we can build a horizontal solution, just like we’ve built data centers now. We believe we're quite uniquely positioned to benefit from this build-out of 5G.”
Recently, AT&T said it was working with VMware SD-WAN by VeloCloud to implement 5G capabilities into its SD-WAN service. The combination could be a solution for businesses looking to use SD-WAN with a high-speed, low-latency 5G network as their primary or secondary WAN connection type in combination with other transport connections.