VMware Vs. Microsoft: 8 Cloud Battle Lines

Microsoft has started to build a worldwide chain of Azure datacenters, with two in Europe, five in Asia, and three in the US. Now it's partnering with 25 third parties to help fill in some of the gaps.

Microsoft is equipping these third parties its Cloud OS Network with the latest Microsoft Virtual Machine Manager, Operations Manager, and Azure Pack, which are Azure cloud functions running on Windows Server. The partners are launching their own Azure-like cloud services.

In many cases, Microsoft is partnering with a regional service provider, allowing a European company to keep its citizens' data inside its own boundaries. One example is TeleComputing in Oslo, Norway, which has two datacenters in that country and two more in Sweden.

In other cases, Microsoft is partnering with companies that already have substantial cloud operations, including CSC (formerly Computer Sciences Corp.) in Falls Church, Va., which has rapidly built up its presence as a cloud vendor on infrastructure built on VCE's Vblocks converged network and compute server racks. VCE is a subsidiary of EMC and Cisco, with VMware as an investor. Vblocks come with VMware's vSphere already installed.

As a sign of how much things may be changing, both CSC and TeleComputing have up until now been primarily hosting workloads based on VMware's ESX Server. Both are now adding a more Microsoft-oriented set of customers. TeleComputing is actually converting its own infrastructure away from VMware into a more Azure-like environment. It will run on a combination of Windows Server 2012, System Center 2012, Hyper-V, and Azure Pack for System Center.

[Want to learn more about how Microsoft seeks to spread the use of an Azure-like environment? See Microsoft Charges Into Enterprise Cloud Market.]

CSC, on the other hand, gained a multi-hypervisor capability when it acquired ServiceMesh in November. CSC is the lesser known of only two occupants of Gartner's Magic Quadrant as a leading public cloud supplier. The other, as you may have guessed, is Amazon Web Services. CSC may be built on VMware-equipped Vblocks, but its hunting for Microsoft-based customers.

Many companies that are heavy users of Microsoft's Hyper-V are looking for a cloud supplier to start them on the path to the cloud, said Eugene Saburi, Microsoft's general manager of channel marketing for Cloud and Enterprise. Sometimes they'd prefer a company in their backyard that can help them with the details, as opposed to a remote Azure datacenter in San Antonio or Chicago. In some cases, they want to establish a private cloud but in a well-managed external datacenter. Microsoft's Cloud OS Network is ideal for that, he said.

In Europe, the regional suppliers can assure Hyper-V users that their data will remain inside national boundaries, as required in Germany, France, and the UK, he added.

With the launch of the Cloud OS Network, Microsoft is moving from being "a company selling Azure services to a company selling the idea of Azure as the cloud system of choice. I'd expect this initiative to be rolled out further and, over the next few months, see the messaging of Azure more strongly centered on the Cloud Operating System theme," wrote Ben Kepes, a cloud consultant in New Zealand, on Forbes Business Insider Thursday.

With its auxiliary network of providers, Microsoft is not emulating the Amazon example. Amazon's EC2 cloud is also based on a handful of data centers in each of the major regions of the world. Rather, it looks more like VMware's strategy. Over the last three years, VMware began extending its reach with dozens, then hundreds, of regional service providers. It operates a handful of its own vCloud Hybrid Service data centers as well.

TeleComputing CTO Kjell-Toe Espeseth, in a phone interview from Norway, said his firm runs 10,000 servers in four data centers in Norway and Sweden. Before Cloud OS Network had been announced, he began moving customer workloads from running under VMware ESX Server and vSphere to Hyper-V to reduce his number of VMware licenses.

For Espeseth's purposes, Microsoft has caught up to VMware enough to allow him to provide IaaS service based on System Center's Virtual Machine Manager, Operations Manager, and the Azure Pack for Windows Server. "VMware costs significantly more. Microsoft licensing is a small fraction of VMware. We will move strongly in the direction of Windows Server and Azure Pack," he noted.

TeleComputing will have no problem continuing to receive ESX Server workloads but will convert them into Hyper-V compatible workloads and run them. He uses Vision Solutions Double-Take to do the conversions.

TeleComputing's data center conversion fits in with a larger conversion going on in its customer base. It used to be an IT services company; it needs to become more of a commodity infrastructure company, which amounts to "decomposing some of our former services into more of a pure infrastructure as a service company," Espeseth said.

IT services remain the biggest part of TeleComputing's business, but Espeseth says the shift to more basic IaaS services is already underway. Establishing commodity infrastructure with the lowest possible hourly rates "is a significant competitive advantage," he said.

Charles Babcock is an editor-at-large for InformationWeek, having joined the publication in 2003. He is the former editor-in-chief of Digital News, former software editor of Computerworld and former technology editor of Interactive Week.

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