Cisco Puts $150m in Virtualization King VMware

VMware scores again. 

EMC’s virtualization unit VMware has now snagged a $150 million investment from Cisco.

Virtualization is a hot technology that lets companies save on hardware costs by running multiple operating systems and applications on a single machine. It’s a key enabler of server consolidation, crucial for large corporations.

VMware is the leader in the virtualization market with an estimated 85% marketshare.

Cisco’s investment gives it a 1.6% stake in VMware and comes close on the heels of Intel’s decision on July 9 to invest $218.5 million in the virtualization outfit.

After VMware’s upcoming IPO and upon closing of the deal, Intel will own 2.5% of VMware’s total outstanding common stock.

Other key players in the virtualization market include Virtual Iron and SWsoft.

Software Goliath Microsoft is also working on a Windows Server virtualization technology called Viridian.

The public beta of Viridian, originally scheduled for the first half of 2007, has been pushed back to the second half of 2007 because of scalability and performance issues.

Microsoft says it’s designing Windows Server virtualization to scale up to 64 processors and hopes to launch Viridian within six months of release of Windows Server “Longhorn” (targeted for release in the second half of 2007).

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