At VMworld Europe last week, it did not take long for me to realize that storage vendors were not exactly singing Storage VMotion’s praises. Instead, many storage vendors were still feeling Storage VMotion’s sting. Why should they care about a new storage value-add in ESX 3.5? Vendors that offer storage virtualization as an integral part of their products have seen one of their key value-adds move to the ESX hypervisor and as a result see Storage VMotion as a threat to their bottom line. Most storage vendors I spoke with see VMware’s competitors (namely Microsoft, Citrix, and Virtual Iron) as opportunities where they can partner with a virtualization vendor and still offer a valuable piece of the virtualization puzzle. That’s not to say these vendors are jumping off the VMware bandwagon, yet. But they are dipping their toes in the waters of other virtualization vendors.

With Storage VMotion, VMware was clearly responding to customer demand for a feature that allows back-end storage management with no impact on running VMs, while increasing the value of their hypervisor. While that’s all good, it’s easy to see why many of VMware’s storage partners would take offense.

Continually adding value to the hypervisor is a key part of VMware’s long term strategy, but where do they draw the line? Some in the virtualization community want VMware to go further. Take my friend Andrew Kutz’s recent blog, for example - Coming soon: Application High Availability (AHA). Andrew believes that integrating application monitoring and application-level HA into VMware VirtualCenter management is a foregone conclusion. For VMware’s sake, I hope that’s not the case. VMware’s addition of Storage VMotion has already begun to alienate some of its storage partners. With that being the case, how do you think vendors in the management space would feel about VMware adding application monitoring and orchestration to the VirtualCenter suite? My guess is that management software vendors such as BMC, HP, IBM, and Opalis would not look favorably on such a move.

VMware is at a crossroads, which is really hard to believe since it is the dominant market leader. VMware’s competition will be front and center in 2008, and while VMware does need to continue to innovate around its hypervisor, they cannot afford to alienate many of the partners that helped get them to where they are today. The line that VMware should not cross may have been drawn in sand and easy to see at some point, but today that line is under a mud puddle and difficult to distinguish. Richard Jones recently articulated VMware’s dilemma in his blog Virtualization Wars, what can VMware learn from the past? and it’s my hope that VMware will learn from the past mistakes of other vendors.

I love Storage VMotion and see back end storage transparency as an integral part of the automated data center. The question we all have to answer, however, is whether storage transparency should be delivered by vendors in the storage ecosystem or by the server virtualization vendors. History has shown us that while vendors continually try to own the application stack and offer end-to-end data center solutions, reality has shown us that every data center is built around a mix of technologies from disparate vendors. VMware’s success will not just be determined by its own bottom line, but by the success of its key partners as well.