EMC Denies VMware Sale, Shares Cloud Storage Plans

Network World — EMC president and CEO Joe Tucci denied having any plans to sell VMware  Monday, just a few days after EMC stock rose on speculation that it would sell the red-hot virtualization company.

Despite selling portions of VMware to Intel  and to investors in an IPO, EMC retains 86 percent control of the company and intends to keep it that way, Tucci told journalists at EMC World in Las Vegas.  

"We have no plans to do anything else but continue to own 86 percent of VMware," Tucci said. "We have no plans to spin out any shares.”

Speculation that VMware is about to be sold has "been around a little while, but is probably picking up a little bit of momentum," equity trader Mike Capitani told Bloomberg News, which reported that EMC shares posted their highest gain since last October because of the recent VMware rumors.

Tucci noted that EMC has let VMware operate almost like an independent company, rather than integrate it fully with EMC. VMware has met every one of Tucci's expectations, and he remains confident in its abilities despite Microsoft's plans to enter the virtualization market, he said.

"Obviously, Microsoft will enter the market. We're in version four, and they're yet to have version one," Tucci said. "We're way beyond the hypervisor in terms of capability, managing, provisioning, business continuity, and a whole host of other areas, [including] the virtual desktop.”

Tucci also discussed EMC's future in cloud storage at EMC World.

EMC last September bought Mozy, an online backup provider, and formed a new cloud computing division. EMC storage technologies code-named Hulk and Maui, which form a clustered storage system, will address the needs of cloud computing and Web 2.0, but EMC hasn't said too much about them. While the Hulk hardware, which provides bulk, high-density storage, has been shipping in beta for several months, the software component, Maui, has yet to be seen. (Compare storage products.)

Maui will start shipping this summer, Tucci said Monday, while describing his vision for cloud storage.

Today information is usually trapped in one device or application that is accessible only by a small set of users, but in the future information will cross today's boundaries and be accessible from anywhere over the Internet, Tucci said.

"We think the world is going to be transformed to information-centric computing," Tucci said. "This is going to be the next wave of computing.”

Cloud storage and the Mozy acquisition also reinforce EMC's departure from its past strategy of focusing exclusively on high-end customers. In 2002, EMC made all of its profits in the high-end storage market, but is now addressing small and midsize customers to expand its reach, Tucci noted.

Cloud storage will bring EMC further into consumer markets. "I do believe there's going to be a fair size of middle class and up homes throughout the world that will have a terabyte of storage in their house, and this is a market worth playing in," Tucci said.

When storage is connected to the so-called cloud over the Internet, information will be easier to share and protect, and easier to access from any device, he added.

While some would argue that information inherently becomes less secure when it leaves the data center and enters the cloud, EMC is working on embedding RSA security capabilities into its cloud infrastructure, according to storage product marketing vice president Barbara Robidoux.