Is the joint EMC and VMware Pivotal Initiative a Disruptor or Last Follower?

PivotalInc

At the EMC VMware Strategic Forum this week the companies announced a new joint-venture called Pivotal Inc. which will launch as a separate company on 01-APR-13.

EMC + VMware’s New Pivotal Initiative

“The new company is 1,250 employees strong to work on this new platform for Big Data, Fast Data and Rapid Application Development sitting on a cloud abstraction and application automation layer. EMC owns 69% of the company and brings Greenplum, Pivotal Labs, and about $400M over the next two years. VMware owns the remaining 31% and brings Cloud Foundry, Spring, Gemfire and Cetas to round out the offering.

The new company is targeting $300M in 2013 revenue with a goal of over $1B by 2017. That’s an aggressive growth rate for a new marketplace; in comparison, VCE is expected to surpass $1B in 2013 with a solution that is made up of mature components with existing markets. The full “Pivotal Platform” will be completed and introduced in the second half of 2013. A VMware-style IPO for Pivotal could happen in a few years if it hits the milestones that the parent companies have set forth”.  Source – Stuart Miniman, Wikibon Senior Analyst

 PivotalHD

Terry Anderson

VP of Global Corporate Communications for Vmware

Extract from an internal blog post last December.

Q: What is the Pivotal Initiative?

VMware and EMC are committing key existing technology, people and programs from both companies focused on Big Data and Cloud Application Platforms under one virtual organization—the Pivotal Initiative—led by Paul Maritz, Chief Strategy Officer of EMC.  The companies expect to formally unite these resources by Q2 2013, with a specific operational structure to be determined.*

Q: Why is this happening?

We are experiencing a major change in the wide scale move to cloud computing, which includes both infrastructural transformation and transformation of how applications will be built and used based on cloud, mobility and big data.

There is a significant opportunity for both VMware and EMC to provide thought and technology leadership, not only at the infrastructure level, but across the rapidly growing and fast-moving application development and big data markets.  Aligning these resources is the best way for the combined companies to leverage this transformational period, and drive more quickly towards the rising opportunities.

Q: Why is this good for customers and partners?

Customers and partners are looking for solutions that enable a new generation of increasingly mobile and data-centric applications that can exploit the datacenter of the future. The new organization will accelerate existing efforts in this area by the two companies, creating a primary, unified and focused endeavor around a common mission, roadmap and strategy.

Both companies remain committed to customer and partner success, and there is not expected to be any impact to existing agreements or committed support.  Customers and partners can continue to buy products and services as they normally would from both companies without interruption during this alignment.

wsj

“The Pivotal group also will carry Greenplum, a software company that EMC offers to customers seeking faster ways to analyze massive and often disorganized troves of data.

Other software providers such as San Francisco-based Splunk Inc. SPLK +0.24% have cashed in on soaring demand for the service with revenue growth that regularly tops 50%.”

Drew Fitzgerald – Wall Street Journal – LINK (subscribers only)

Why Splunk?

Splunk Q4 Results reported revenues up 51% year-on-year. Godfrey Sullivan, Chairman and CEO. “It is gratifying to see our customer relationships evolve to enterprise-wide deployments as organizations choose to standardize on the Splunk platform for their machine-generated data.”

Splunk Product Overview

The Splunk mission is simple: make machine data accessible, usable and valuable to everyone. Today, Splunk is the leading platform for real-time operational intelligence, used by thousands of organizations across the globe — to run IT better, to better secure and audit IT, to deliver powerful insights into customers, services, devices and sensors

WDGLL specs

My view is that the Pivotal Initiative is a last follower because EMC and VMware are responding to customer demand by bundling together a set of assets into an offering that is not built from the ground up to address a specific Business need.  Moreover it will be of interest to establish licensing against more nimble companies such as Splunk with their Enterprise and Storm (cloud based) offerings.

Splunk went public in 2012 and two [Erik Swan and Robert Das] of the oringinal three co-founders remain on the Exec Management Team. 

“over half of the Fortune 100, use Splunk Enterprise to gain new levels of visibility and insight from their machine-generated big data”

This week Splunk® Enterprise was selected as the winner in the Best Security Information Event Management (SIEM) Appliance for 2013.

“Splunk offers its main software in two license types: —an Enterprise License designed for companies and large organizations, and a Free License designed for personal use. The freeware version is limited to 500 MB of data a day, and lacks some features of the Enterprise license edition”.

Splunk is definitely a disruptor in the field of big data and analytics and the company tag line is “Listen to your data” to obtain operational intelligence.

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