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Vmware in Class Case Analysis

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VMware In Class Case Analysis

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From my perspectives, the main sources of VMware’s competitive advantage are immense lead in the virtualization market, high investment in R&D department, a large number of technology alliances and distribution networks, a strong hold on the high-end segment, high customer satisfaction, advanced hypervisor platform and server-based virtualization technology, large installed base and high switch cost for existing customers. So how is that advantage linked to the strengths and weakness of virtualization technology for VMware? Since VMware now has the immense lead in the virtualization market and high customer return on investment helps the company to sustain the lead, it has more money to invest in R&D department and able to attract and form more partnerships with other companies thereby making VMware continue playing a competitive role in the virtualization market. In addition, since VMware has large customer installed base compared with Microsoft and other companies and the switch cost for people who use their VMware’s management tool and build operations around that is pretty high, it has the opportunity to sustain the lead for a long time and build customer loyalty.

VMware also suffers from its weakness of virtualization technology. The weakness may include performance penalty especially for a hosted architecture which requires three layers of software to run any application and the possibility to make the system more complex and leads to security, management, licensing and pricing issues. Moreover, because of resource limitation, it was now able to offer only products designed and priced to cover the entire market rather than customizing to each segment, hinder its ability to profit fully from the value that it created for high-end customers. However, some of the weaknesses may not be really problems now.

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