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Eye of the Needle by David Needle (bio)

Insights from Silicon Valley and beyond



Hey Microsoft, forget Yahoo, buy VMware

The aftershocks are still reverberating from today's news of the unceremonious departure of VMware cofounder and CEO Diane Greene. While the news was a surprise to most, you have to assume VMware's board of directors has been actively planning for her exit for some time as it had a ready replacement to announce as CEO in Paul Maritz.

Maritz is the former Microsoft executive perhaps best known for some of the more colorful comments attributed to him during the software giant's antitrust trial with the Department of Justice in the '90s. The South African-born Maritz denied ever making the widely quoted statement that Microsoft would "cut off Netscape's air supply" back when Netscape had the leading Internet browser.

Satoshi Nakajima, who worked for Maritz as lead software architect for Windows 95, was surprised to hear about the appointment when contacted by InternetNews.com.

"Wow. I think they [Microsoft] should forget about Yahoo and buy VMware," Nakajima said. "Maritz knows Steve Ballmer, and who knows, this whole thing could be setting the stage for Microsoft to do a deal."

The rumor mill also has Intel potentially interested in buying VMware. Either Intel or Microsoft could do it, but EMC's price tag would likely be staggering.

In any case, Nakajima said Maritz's knowledge of the enterprise software market makes him a good fit for VMware. "Paul Maritz was the reason Microsoft shifted more of their business to the enterprise side. He saw there was a lot more opportunity to make money from enterprises than consumers as far as the revenue per machine Microsoft could make."

Nakajima is currently president of Big Canvas, a startup working on photo-sharing software for Apple's iPhone.

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1 Comments

Paul Rogers said:

This suggestion is brilliant. So obvious once you hear it!

To me, it is just a matter of time, then the VM will become the OS and today's OSes will become merely one of several application containers running on the VM.

A large OS vendor needs to control the VM to avoid becoming the cork bobbing in the ocean at the mercy of forces they can't control.

At the $20 to $70 mark, VMware would be compelling today. I wonder if VMware will take the low cost high volume route to Microsoft style riches? Today, for 4 core and 8 core processors, they seem too attached to Enterprise pricing that precludes tens of millions of PC users buying quad core and soon octal core PCs.

I think VMware has a great future, but they should go for volume.

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