VMware (VMW) to Buy Dell EMC's Suite to Boost NFV Segment
VMware VMW is expanding its Network Functions and Virtualization (NFV) portfolio as evident from its recent announcement to acquire Dell’s EMC Service Assurance Suite.
Dell’s EMC Service Assurance Suite is capable of self detecting problems, automating service assurance and performing root cause analysis for communication service providers (CSPs) and their clients. Currently, more than 50 CSPs including a number of Tier 1 operators use the suite.
The suite’s expertise will aid VMware in winning new telecommunications clients. “As carriers are readying for 5G, they are increasingly virtualizing edge and core networks with network functions virtualization” per management.
The technology is capable of supporting 5G services that power advanced applications like Internet of Things (IoT), Machine Learning (ML), Artificial Intelligence (AI) and Virtual Reality (VR). IoT is the next big technology, expected to grow to $561.04 billion by 2022, per Market Research.
Vmware, Inc. Revenue (TTM)
Vmware, Inc. Revenue (TTM) | Vmware, Inc. Quote
Strength in Virtualization Solutions a Key Catalyst
VMware is regarded as a pioneer in providing virtualization software solutions that cater to about two-third of the total server virtualization market.
With innovative virtualization products and cloud suit solutions, VMware continues to witness robust growth in the virtualization market, which has grown in double digits. This apart, the company is gradually expanding its virtualization expertise from servers to networking and storage.
Moreover, the company’s dominance in software-defined data center (SDDC) along with expanding customer base in cloud driven by partnerships with the likes of IBM and Amazon’s AMZN AWS is a positive. Additionally, continuing enterprise deal wins will drive growth in the long haul.
Moreover, VMware has been consistently taking initiatives to diversify its product portfolio to include most of the IT infrastructure. The company’s acquisitions of Desktone and Airwatch have significantly strengthened its position in this aspect.
Further, VMware’s offerings in domains like SDDC, hybrid cloud and end-user computing (EUC) have helped it gain market share.
However, intensifying competition from players like Microsoft MSFT and software vendors such as Citrix Systems is a major concern. Moreover, heavy spending on research & development (R&D) is expected to weigh on its margins.
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