Well, no one was expecting this. Everyone knew and had conjectured that VMware was going to be buying someone in the MDM (Mobile Device Management) space, but to be fair AirWatch was never on the radar. Some of that was due to the fact that CEO John Marshall had declared that he wasn’t interested in selling and other was due to speculation on MobileIron and Good being better fits to what VMware traditionally did.
The funny thing, despite all that VMware has proclaimed for the last three years, they really haven’t been doing mobile. They spent far too long developing a virtualization product for Android that carriers weren’t willing to push and OEMs didn’t talk about. They came up with a strategy for iOS devices that could work but very few were interested in and yet they continued forward with pieces that would fit very well within an encompassing mobile strategy such as parts of their Horizon suite.
The big thing with VMware is that they knew that they had to get a hand around mobile and we had heard about past overtures in this space. Their EUC (End User Computing) division had struggled with building a mobile solution themselves and this had led to a complete shakeup of the whole division bringing Sanjay Poonen in from SAP. Sanjay has a track record of knowing where to focus and it has been evident over the last few months that he understood the weaknesses of his EUC division.
So why buy AirWatch? Airwatch has a long history, starting as Wandering WiFi and then pivoting into the MDM space after the iPhone came out and smartphones became mainstream. John Marshall, their CEO, has been laser focused in building the “biggest and best” MDM company around and yet wasn’t afraid to be challenged and react to those challenges. What had started out as an MDM only company quickly morphed into and EMM (Enterprise Mobility Management) play where AirWatch took on the challenges of content and app management.
I sat with John Marshall a little over 3 years ago and asked him “MDM is dead, where are you going next?” His answer to my question was most telling. “Brian, I don’t quite agree with you that MDM is dead. It still has a lot of life in it, but, we are in this for the long haul and understand it’s more than just about devices.” John and I have had many debates like this over the years and it’s been fun watching them grow from a company of less than 500 people to one of more than 1600. Their goal has always been to be the “go to” company when it comes to mobile and they have embraced the whole EMM stack (well most of it, MIM isn’t there for anyone yet).
Sanjay, realizing what he had in VMware, has essentially thrown out the baby with the bath water and put a stake in the ground for VMware. AirWatch will be VMware’s mobile play and will eventually integrate other pieces of VMware’s EUC division as they fit into an overall mobile strategy. Airwatch gets more pieces to make its engine go faster, a great worldwide work force to augment what they have been building and some real talent to help with development for the pieces that they will integrate. VMware now owns the entire stack from (virtual) server straight through to desktop and mobile, essentially from the datacenter to the endpoint. This is huge for them and allows them to continue to on the enterprise money train. It also gives both of them the ability to leverage the other, VMware now has a cogent mobile story to walk into its many clients and AirWatch gets even more access to people who can make decisions and are already partnered with VMware.
It’s hard to see this as anything other than a win-win situation for both players, while other EMM players will have to work even harder to match the scope and velocity of the new VMware/AirWatch. Expect to see the remaining players become even more of an acquisition target as we move further into 2014.