VMware CEO Gelsinger: Dell Acquisition Of EMC, VMware Won't Impact HPE Relationship

Despite being part of Dell's massive acquisition of EMC, VMware will continue to strengthen its partnerships with companies that compete with Dell, VMware's top executive told CRN.

Pat Gelsinger, CEO of VMware, told CRN after a Monday press conference at this week's VMworld conference that VMware will continue to work with Dell's rivals, including Hewlett Packard Enterprise, after Dell's acquisition of EMC closes.

VMware is majority-owned by EMC.

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Gelsinger talked to CRN a day before Dell received Chinese regulatory approval for the acquisition. The deal is now expected to close Sept. 7.

Gelsinger told CRN there is really no change in VMware's relationships with technology partners that also compete with Dell, including HPE.

"It's incumbent upon us that we lean into those relationships in this period of time. … I'm driving my teams very hard," he said. "How do we have different programs, different partnerships, etc. to really demonstrate that continued ecosystem independence and investment that VMware's going to make. And that's probably nowhere more important than with HPE."

Gelsinger said he mentioned during VMware's second-quarter financial analyst call that his company had a good quarter with HPE. "So the early signs are positive," he said.

VMware would be wise to maintain its HPE relationship, said Chris Case, president of Sequel Data Systems, an Austin, Texas-based solution provider and longtime partner of both HPE and VMware.

"You don't see Microsoft not partnering with hardware guys on the enterprise side," Case told CRN. "Microsoft doesn't care if you are HPE, Lenovo, or whoever."

Case said that nothing seems to have changed between HPE and VMware since Dell first announced its planned acquisition of EMC. "We partner with them both in enterprise and commercial accounts," he said. "They partner with us on our services. I'm not concerned things will change. But we'll have to see what happens."

Gelsinger along with Dell CEO Michael Dell used a press conference at VMworld to answer a broad range of questions.

For instance, when asked how VMware would transition its business to a services model, Gelsinger responded that in the last quarter, about 7 percent of VMware's business came from Software-as-a-Service and that it is expected to grow 1 percent or 2 percent per quarter.

"We don't expect this fundamental right-hand turn to a SaaS model. The majority of customers, private cloud customers, on-premises customers, continue with that perpetual business model."

However, Gelsinger said, the business is in general certainly moving toward services.

"So we're building new offerings like cross-cloud services," he said. "Airwatch is delivered as a service, desktop as a service, vRealize as a service. More and more of our products will be on that side of the ledger. And we're enabling our customers to consume them at their rates of change. … And we still have a lot of work to do as we move to this as-a-service world. Our job is to make sure we give the customer the business model and the tools they need to make that transition."