Virtual Computing Environment (VCE)

2009

On November 3, 2009 the companies Cisco and EMC together with VMware announced creation of the coalition under the name Virtual Computing Environment (virtual environment of calculations) which represents consolidation of three leaders of the information and technology industry. The coalition is called to accelerate distribution of the new solutions increasing business flexibility of customers due to increase in flexibility of IT infrastructure and decrease in information and technology and power expenses and also expenses on production premises by broad virtualization of data processing centers and transition to private cloud infrastructures.

Cisco, EMC and VMware cooperated and created the general vision of future corporate information and technology infrastructures based on the principle of private cloud computing (private cloud computing). The private cloud represents safe IT infrastructure which is reliably controlled and operated for the benefit of the one and only organization. The organization can manage a private cloud independently or charge this task to the external contractor. This infrastructure can be placed or in premises of the customer, or at the external operator or partially at the customer and partially at the operator. Private cloud computing combines controllability and security of modern data processing centers with the flexibility necessary for business innovations. Besides, they considerably cut down the customer's expenses.

According to McKinsey and Company analytical company, annual expenses on infrastructure technologies and services of data processing centers on a global scale exceed 350 billion US dollars. A half of this amount is the share of a capital expenditure (purchase of products), and other half - of current expenses (services and the salary). It is remarkable that at least 70 percent of this amount * leave on support of the existing infrastructure, and only 30 percent (and sometimes less) are spent for the new technology initiatives and applications capable to give the companies decisive advantages over competitors. According to some information, by 2015 about 85 billion dollars ** (i.e. 20% of this market) can be attracted to projects of virtualization of data processing centers and implementations of private cloud computing.

The Virtual Computing Environment coalition offers the organizations of any size the accelerated transformation of data processing centers and sharp increase in efficiency of their work due to considerable reduction of capital and current expenses. As a result the organizations should not select between the latest technologies and commitment to one vendor.

The main product of Virtual Computing Environment - the integrated Vblock IT solution, integrates technologies of the founder companies: servers and Cisco switches, storage systems of EMC and software of virtualization of VMware. With the advent of infrastructure packets of Vblock the Virtual Computing Environment coalition will provide to customers absolutely new approach to optimization of IT strategy using private network clouds. Vblock - the infrastructure, completely integrated, tested, checked and ready to work and development, including the network and computing technologies, technologies of virtualization, storage, security and management, best in the class, from Cisco, EMC and VMware companies. At the same time the supplier completely is responsible for the delivered solution.

The coalition will accelerate distribution of the Vblock systems using global community of system integrators, operators, trading partners and independent software developers. To simplify distribution of new solutions, the coalition created the unified system of pre-sale support, professional services and maintenance.

2014

Virtual Computing Environment will be a part of EMC

As reported the agency Bloomberg, EMC redeems the main part of a share of Cisco Systems in joint venture. EMC which enclosed in this enterprise of $1.26 billion from the moment of its creation for October, 2014 owns 58% of its stocks. Investments of Cisco made $716 million, it possesses 35% of VCE, and as a result of the transaction there will be 10%. Transaction amount does not reveal. According to the statement of both parties, it is only about the financial agreement, it will not influence business of VCE in any way.

The joint venture will be a part of EMC and, according to Joe Tucci, "will become one of main growth drivers". Still, Wall Street Journal notes, VCE did not consider a hardware sales return, expenses on it passed as losses at EMC and Cisco. After change of structure of ownership income and expenses of VCE will join in results of EMC which stated that in general it slightly will lower its income per share in 2015, but then should lead to its increase.

EMC is organized on so-called federal model now, EMC (the producer of storage systems), VMware and software developer for the analysis of "Big Data" of Pivotal are its part actually. The CEO of the company Joe Tucci directs its business in general, but each of divisions has own CEO. VCE, most likely, will become one more part of federation; 2000 of her employees will pass into EMC.

For clients of VCE of significant changes in result of the transaction it is not expected. The company her CEO Pravin Akkiradzhu will still direct. Cisco, EMC and VCE updated technical, resellersky agreements and support agreements.

Officially Cisco and EMC stated that VCE will have more opportunities for growth and innovations under control of one owner. However according to many experts, the transaction purpose – to reduce the strength which arose recently in the relations of two companies. In particular, Cisco competes with VMware more and stronger; the last in 2011 from approval of EMC purchased software company Nicira, the developer of technologies programmatically of the configured networks (SDN) which give the chance to manage inexpensive network equipment. Cisco, in return, last year purchased Whiptail – the producer of storage systems on a basis a flash memory working in a new niche in the field of data storage at which also EMC aimed. Cisco also closely cooperates with NetApp, the direct competitor of EMC, and its servers the Unified Computing System series for DPCs can be considered as Vblock alternative from VCE. At last, EMC purchased Cloudscaling company, and Cisco – Metacloud, both from which specialize in OpenStack technologies.

According to IDC, 24.3% of the market fell to the share of VCE in the II quarter 2014. In May of the 2014th VCE announced that its sale it is by the end of the year reached $1.8 billion, is 80% more, than in 2013. In the comments in the corporate blog cochairmen of Board of Directors of VCE Howard Elias (the president and COO EMC Global Enterprise Services) and Gary Moore (the president and COO Cisco) called this joint venture the most successful in all history of IT market.