Beware VMWare!

Hot on the heels of the Cisco hyper-mega-switch announcement and Yahoo announcing a reduction in workforce despite increasing profits, comes the nose-dive of VMWare's stock price; losing one-third it's value in a single day. Keeping in mind that Wall Street is capable of either irrational exuberance or irrational pessimism, the events pertaining to Yahoo and VMWare are most likely an expression of the latter. Both companies have solid business plans.

From the performance angle, however, it may also be that the honeymoon period is now over in part because VMWare is a victim of its own success. Not only has all the hype surrounding virtualization and consolidation worn a bit thin these days, but it has also attracted the big guns---Microsoft and Oracle---into the market. And customers are not doubt becoming aware that consolidation doesn't always translate into less MIPS or more greenness. The overheads of virtualization can be very significant. The problem for us performance weenies is knowing what are those overheads in a QUANTITATIVE way. As I've stated before:

All virtualization is about illusions and although it is perfectly reasonable to perpetrate such illusions onto a user, it is entirely unreasonable to propagate those same illusions to the performance analyst.

So, here's an opportunity for VMWare to differentiate itself in the madding crowd of new VMM vendors; focus on providing more whistles and less bells. And you (Dear reader), as John Q. Customer/Analyst, should demand it (even if by proxy). If you don't make the ultimate performance issue known to management, how can they be expected to pressure the vendors?