As a leading virtualization and cloud computing infrastructure provider with a 85% share of the global virtualization software market in recent years, the US-based #VMware is gearing up to explore the great business potential in the Asian market, particularly Greater China. The server virtualization market in China posted an annual growth of 19% in 2016, and is expected to expand by over 20% in 2017, with VMware's share of the China market estimated at over 40%. In a recent interview with Digitimes, Bernard Kwok, who was appointed in 2016 as the firm's president for Greater China, talks about market conditions and prospects in Greater China, how VMware will do to achieve better business records in the region, and how to pursue closer cooperation ties with Taiwan's server makers such as Quanta. The following is an excerpt of the interview. Q: You have assumed the new post for over one year. How do you assess the current market situations in Greater China? A: Enterprises in Greater China are actively undergoing digital transformation, and their CIOs (chief information officers) are striving to upgrade the performance of their data centers to meet the transformation needs. In this regard, high flexibility and agility of IT infrastructure architecture can facilitate fast deployment of new applications. Usually, it will take weeks for traditional data centers to deploy new applications, and only one in two will finally work well, thus failing to meet ever-changing needs of consumers. The deployment, however, can be done in a few minutes if servers, storage and networks can be virtualized into resource pools, together with the employment of the cloud management platform. CIOs are also considering how to allow customers to use mobile computing technologies under a sound information security environment. It is crucial for corporate IT staff to make good use of multi-cloud resources to build distinct competitiveness. In this regard, two core technologies, software-defined networking (SDN) and cloud management platform, are needed to facilitate effective movement between public and private cloud resources. VMware has developed software products based on the two technologies. Q: What about the market demand and prospects for virtualization technology in Greater China? A: I'm quite optimistic about the market prospects in the region, with Hong Kong and Taiwan taking the lead. VMware Taiwan has done a good job under the leadership of its general manager Chen Hsueh-chi, in promoting virtualization and SDN of servers, storages and data centers. VMware is technically capable of cross-cloud operations and its desktop virtualization business is experiencing sharp growth. In the last quarter, VMware's global SDN business revenue posted a sharp annual growth of 50%, with revenue from the China market showing an even higher increase. Our global software-defined storage business recorded a whopping 150% growth during the period, and China again witnessed a higher growth in the sector. Q: How do you see the characteristics of the Greater China market? A: A survey showed that customers in Greater China spent 86% of their IT budget on buying hardware equipment in 2012, and the figure declined to 72% in 2016, compared to 38-40% in North America. The high ratios indicated that China customers usually prefer to purchase IT hardware already paired with required software. Accordingly, VMware will develop closer ties with hardware partners such as HPE, Dell, EMC and Quanta Cloud Technology to better meet the needs of China customers. Q: In addition to HPE and Dell, Taiwan's Quanta is also among the global partners of VMware's Cloud Foundation. What about the progress in bilateral cooperation? A: VMware has maintained very good ties with its hardware partners, including Quanta. In fact, Quanta Cloud Technology (QCT), an affiliate of Quanta, has been a close partner, and we will unveil a new cooperation project for QCT at a proper time, and I myself will take part in the project, probably associated with large-sized data center operation. VMware will also move to team up with new partners in both Taiwan and China to carry out different cooperation projects. Q: There are many companies making forays into the virtualization and software-definition fields. How do you assess the competition? A: Indeed, many IT companies are eager to vie for a slice of the market, but VMware has maintained a high R&D expenditure ratio, up to 20%, of its revenue, which is the crucial foundation supporting our continued growth. Software definition business boasts great development potential, and business growth in Greater China is higher than in other parts of the world. We're confident about further growth in the region.
http://www.digitimes.com/news/a20170707PD207.html
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