emc & vmware hybrid cloud service offering vmware brand and operated mid ’13 launch hybrid...

EMC & VMWARE STRATEGIC FORUM NEW YORK | MARCH 13 2013

Raghu Raghuram Executive Vice President, Cloud Infrastructure and Management VMware

This presentation contains forward-looking statements including, among other things, expectations regarding the evolution of corporate and enterprise IT , VMware’s strategy and drivers for growth, potential business opportunities for VMware and the total addressable market for VMware products and services, and potential benefits, planned features and expected availability of VMware products and services including VMware NSX and vCloud Hybrid Services. These forward-looking statements are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) adverse changes in general economic or market conditions; (ii) delays or reductions in consumer or information technology spending; (iii) competitive factors, including but not limited to pricing pressures, industry consolidation, entry of new competitors into the virtualization market, and new product and marketing initiatives by our competitors; (iv) our customers' ability to develop, and to transition to, new products and computing strategies such as cloud computing and desktop virtualization; (v) rapid technological and market changes in virtualization software and platforms for cloud and desktop computing; (vi) changes to product development timelines; (vii) our ability to protect proprietary technology; and (viii) our ability to attract and retain highly qualified employees. These forward looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including our most recent reports on Form 10-K and Form 10-Q and current reports on Form 8-K that we may file from time to time, which could cause actual results to vary from expectations. The information in this presentation reflects management’s views as of the date of the presentation. VMware assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release.

The Software-Defined Data Center

Abstract Pool Automate

Software-Defined Data Center All infrastructure is virtualized and delivered as a service, and the control of this data center is entirely automated by software.

Windows Linux Databases Mission Critical

HPC Big Data

Windows Linux Databases Mission Critical

HPC Big Data

Software-Defined Data Center

VDC VDC VDC VDC VDC

Software-Defined Data Center Services

Abstract Pool Automate

Infrastructure for Traditional Apps

Infrastructure for Traditional Enterprise Apps

Existing Application bound to vendor specific HW

Hardware-based Resiliency

Hardware-based QOS

Hard To automate

Complex to scale

Traditional Applications

2016 141M

2012 83M 70%

Infrastructure for New Apps Infrastructure for New/Cloud/Data Apps

Application Specific Network and Storage

Next Gen Cloud Applications

2016 48M

2012 6M 700%

Software-based Infrastructure

Transformational Economics

Automation and Agility

Designed For Scale

SDDC Delivers Single Architecture for New and Existing Apps

Infrastructure for New/Cloud/Data Apps

Application Specific Network and Storage

Infrastructure for Existing Enterprise Apps

Existing Application bound to vendor specific HW

Any Application

Any Hardware

SDDC: The Strategy For Growth

Compute Virtualization

Network Virtualization

Software Defined Storage

Management and Automation

2016 141M

2012 83M 70%

2016 48M

2012 6M 700%

All Applications

Source: Analyst Data and VMware Internal Analysis, 1Q2013

SDDC: A Significant Opportunity for VMware

$28B VMW TAM

20%+ CAGR

Our Starting Point

$6B Compute

Source: Analyst Data and VMware Internal Analysis, 1Q2013, Source of Benchmark data: Satmetrix 2011 Industry NPS study. Segment shown: B2B Computer Software (incl. Microsoft, Oracle, SAP)

Our Starting Point: A Powerful Foundation

VMW Today: ~36M VMs

480K Customers

Net Promoter Score

GLOBAL

VMware 2012 NPS

Industry

Average

NPS Ran

Server Virtualization The Foundation for the

Server Virtualization Adoption on Path to 80% Over Next 5 Years

2010 2011 2012 2013 2014 2015 2016 2017 2018

% Virtualized of x86 Workloads

2012 to 2016

Change = +12 pts

Source(s): IDC: Annual Virtualization Forecast, Feb-13; Gartner: x86 Server Virtualization, Worldwide, 3Q12 Update; Gartner: Forecast x86 Server Virtualization, Worldwide, 2008-2018, Jul-11; VMware estimates,

Note: Server workloads only 1 Installed Base totals assume 5-year refresh

Gartner

2012 to 2016

Change = +22 pts

Total x86 Workloads

2009 2010 2011 2012 2013 2014 2015 2016

Millio

x86 % PhysicalServersUnvirtualized

IDC+ VMW

Estimate:

Workloads1

2012 to 2016

CAGR = 21%

Emerging Markets and

New Customers

Emerging Markets (excluding North America & Western Europe)

2016 42M

2012 20M 105%

Drivers for Growth of Core Server Virtualization

Unvirtualized Traditional Workloads

Telco HPC Embedded

2016 141M

2012 83M 70%

2016 48M

2012 6M

New Workloads

Network Virtualization

The Network is a Barrier to Software-Defined Data Center

Compute Virtualization Abstraction Layer

Physical

Infrastructure

Software Defined Data Center

SOFTWARE-DEFINED DATACENTER SERVICES

Provisioning is slow

Placement and Mobility are limited

Hardware dependent services

Operationally intensive

Programmatic provisioning

Run any workload anywhere

Decouple services from hardware

Operationally efficient

The Solution: Transform the Network with Virtualization

Network Virtualization Abstraction Layer

Physical

Infrastructure

The Starting Point For Network Virtualization: Virtual Switch

2010 2011 2012 2013 2014 2015

Physical Server Access Ports

Source: CREHAN RESEARCH Inc. and VMware Estimates, March 2013

HALF of all server access ports are already virtual…

…and are on track be ~67% of all ports in 2 years

~40% of virtualization admins also

manage virtual switching

Virtual Switch Ports

32% CAGR

VMware: Two Most Deployed Network Virtualization Stacks

VCNS vSphere

Hardware and Location Independent

VMware Openstack

KVM/Xen

Openstack

Introducing VMware NSX

VMware NSX Multi - Hypervisor

Multi – Cloud Management Platform

Hardware and Location Independent

VMware OpenStack

Physical

LAN/WAN L4-7

Early Adopters Transforming Operations with VMware

Speed 7 Days to

60 Seconds

Transformed the time it

takes to deploy complex

test and development

environments.

Cost 60% to 90%

Asset Utilization

Delivered enterprise-class

private networking in a

public, multi-tenant cloud.

Storage

The Challenges in Storage Infrastructure

Provisioning is slow and operationally Intensive

Continue to drive down TCO

Not suited for new app types

Physical

Infrastructure

Abstract from hardware

Pool local and external storage

Automate provisioning

Support “new” apps

The Solution– Software Defined Storage

Physical

Infrastructure

Software Defined Storage

VIRTUAL FLASH

Virtual SAN

VIRTUAL Volumes

Pool and abstract local and external storage

Automate through software-based policy for all apps

The Road to Software

Defined Storage

Management

Cloud Management

Cloud Infrastructure

Agile, Scalable, Simple

Health Risk Efficiency

New Approach to Management

Traditional IT Management

Rigid. Complex. Fragile

Manager of

Managers

Broker of

IT Services

vCloud Automation Center

vFabric Application Director

Cloud Service Provisioning

vCenter Operations

Management Suite

Cloud Operations Management

VMware IT Business

Management Suite

Cloud Business Management

Vision: Simplify, Automate, and Govern Across Multiple Platforms and Providers

Strong growth in 2012…

2012 license bookings now 10% of bookings

Customer base increased by ~200%

… Significant opportunity ahead

Single digit penetration into installed base

Portfolio expansion doubles market

Customer Value Propositions

Service Provisioning

vCloud Automation Center

Reduced provisioning from

days to minutes

Solution extended

throughout NewsCorp

Cloud Operations

Management

vCenter Operations Management

Managing over 10K VMs

Reduced daily alerts 10x

Found 92% VMs over-prov.,

reclaimed 1000 VMs

Cloud Business

Management

vCloud ITBM

6% reduction in unit costs

through Unit Cost Analysis

$20M in annual cost savings

Packaging and GTM

From Virtualization to SDDC

Virtual

Cloud Service Provisioning

Virtual Networking and Security

Software Defined

Storage and Availability

Operations Management

vCloud Suite

Transactional Journey

Driving the Transactional Business vSphere w/ Operations Mgmt:

Managed Virtualization VDP-Advanced: Backup for

Mid-sized Deployments

VMware vSphere

Data Deduplicated

VDP/VDPA

Powered by

USD $1745- $4245 per CPU USD $1095 per CPU

The vCloud Suite

MANAGEMENT

VMware vCenter

Operations

Management Suite

VMware vFabric

Application

Director

Physical Infrastructure (Server, Storage, Network)

CLOUD INFRASTRUCTURE

VMware vSphere

Virtual

Networking and Security

Software-Defined

Storage and Availability

EXTENSIBILITY

VMware vCloud

Connector

VMware vCenter

Orchestrator

VIRTUALIZATION

VMware vCloud

Automation Center

VMware vCloud Director

VMware vCenter

Site Recovery

Manager

VMware vCloud

Networking &

Security

All vCloud Suite Editions Deliver ~4x ROI

0.6 years 0.6 years 0.6 years Payback

Cumulative Over 5 years

SOURCE: roitco.vmware.com

Summary

SDDC: The infrastructure for the cloud.

Server virtualization:

Foundation for the SDDC

Introducing VMware NSX

VMware uniquely positioned

to deliver the SDDC

EMC & VMWARE STRATEGIC FORUM NEW YORK | MARCH 13 2013

Carl Eschenbach President and COO VMware

This presentation contains forward-looking statements including, among other things, planned features and expected availability of VMware products and services and the expected benefits to customers and partners, including vCloud Hybrid Services, potential business opportunities for VMware and the total addressable market for VMware products and services and our continued investment in service providers. These forward-looking statements are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) adverse changes in general economic or market conditions; (ii) delays or reductions in consumer or information technology spending; (iii) competitive factors, including but not limited to pricing pressures, industry consolidation, entry of new competitors into the virtualization market, and new product and marketing initiatives by our competitors; (iv) our customers' ability to develop, and to transition to, new products and computing strategies such as cloud computing and desktop virtualization; (v) rapid technological and market changes in virtualization software and platforms for cloud and desktop computing; (vi) changes to product development timelines; (vii) our ability to protect proprietary technology; and (viii) our ability to attract and retain highly qualified employees. These forward looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including our most recent reports on Form 10-K and Form 10-Q and current reports on Form 8-K that we may file from time to time, which could cause actual results to vary from expectations. The information in this presentation reflects management’s views as of the date of the presentation. VMware assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release.

VMware Hybrid Cloud Service Offering

VMware Brand and Operated

Mid ’13 Launch

Hybrid Services

Partners

Agility

Public

vCloud

Hybrid Service VSPP

VMware’s New vCloud Hybrid Service

WHAT: vCloud Hybrid Service

Customers: Support

traditional & NextGen

applications

Partners: Capitalize on public

cloud opportunity

VMware: Extend

success of private cloud

to hybrid cloud

VMware uniquely positioned to be the trusted cloud provider

SIZE OF OPPORTUNITY: $14B by 2016

Bridging the Gap Between the Business and IT

Two Key Challenges:

1. Growing chasm between Business and IT due to lack of agility

2. Lack of trust for business-critical workloads in the public cloud

The Solution: Common platform that spans private and public cloud, linking them together seamlessly

VMware & Our Partners Bridge the Gap

Accelerating the adoption of cloud across

IT and the Business in a coordinated approach

Line of Business Requires speed, agility and

the ability to innovate

IT Team Focused on maintaining

reliable, secure infrastructure

Mutual Benefits, Common Goal

Line of Business

Build Once, Deploy Anywhere

IT Operations

Deploy Anywhere, Manage Once

Common Toolset Common Skillsets Common Processes

Extending the Private Cloud to the Hybrid Cloud

Seamless

Extension of

the Data Center

Public Cloud

Software-Defined

Data Center

Private Cloud

Any Application, Any Place… No Changes

Software-Defined

Data Center

Common Management &

Orchestration Platform

Unified Network

Architecture

Common Security Model

One Support Call

Our Cloud Opportunity

The TAM Our Starting Point

VMW Today:

~36M VMs

Customers

Expanding our Share of

Hybrid Cloud Opportunity

A Significant Opportunity for VMware

The TAM Future Opportunity

Expanding

Relevance

Customers

Grow Our Share

vCloud Hybrid Service GTM – Partner-Centric from the Outset

Private VMware

Salesforce

Partners

Hybrid

From Selling Private Cloud To Selling Hybrid Cloud • Same GTM model

• Standard VMware vCloud Hybrid Service SKU

• High value services opportunity for partners

Partners Increase Reach, While Maintaining Relationship

“We are trying to build that recurring revenue

stream and this fits right into that strategy…”

“This strengthens our portfolio considerably –

our emphasis has been consulting, consulting,

consulting… this enables our focus on

managed services”

“This will fix a lot of customers issues… we love

that you will deliver most of that fixing through

a partner”

Bill Bill

vCloud Hybrid

Service Customer

“Great timing – we don’t want to host this kind of

infrastructure service but we do want to offer

managed services on top of it”

Partners

Continued Investment in Service Providers and VSPP

87% Growth 26 Countries 220 Public Clouds

vCloud Hybrid Service IP

for Service Providers

Customer Management Software

Reference Architecture

Operations IP

vCloud Suite

Optimizing VMware’s Strong Ecosystem with Cloud Credits

55,000 VMware Partners Worldwide

Cloud Credits

Reseller

Partners SP

Partners

VMware’s Hybrid Cloud Services Business Unit

Pleased to Introduce:

Bill Fathers,

SVP and GM of VMware’s

Hybrid Cloud Services

Business Unit

Right Team, Right Time

Introducing VMware’s New vCloud Hybrid Service

WHAT: vCloud Hybrid Service

Customers: Support

traditional & NextGen

applications

Partners: Capitalize on public

cloud opportunity

VMware: Extend

success of private cloud

to hybrid cloud

VMware uniquely positioned to be the trusted cloud provider

SIZE OF OPPORTUNITY: $14B by 2016

Thank You

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