Citrix and Microsoft have each been gritting their teeth at VMware for years. Despite that, VMware has experienced longstanding success in the virtualization space. Clearly, neither Citrix nor Microsoft expected VMware to develop into such a powerhouse.

In both the virtualized application/desktop market and the hypervisor market, Citrix in particular tackled VMware like for like for years, and this one-upmanship approach had limited success. Then, Citrix and Microsoft joined together and rewrote the rule book by moving the playing field from the data center to the cloud.

In the past few months, VMware teamed with Amazon Web Services and released its own cloud virtualization platform, Horizon Cloud. It is now VMware that is playing the “me too” game in an attempt to counter the Citrix/Microsoft team.

Whether due to the Dell acquisition or just to technology itself, VMware is a solid year behind Citrix and Microsoft with respect to its focus on cloud. Further, compared to Citrix and Microsoft, VMware’s cloud strategy is somewhat fragmented and lacks the cohesion that they are able to confidently display.

This battle for virtualization market leadership focuses on two areas: virtualized applications/desktops and hypervisor. Let’s delve into these to determine the current and future impact of both.

Virtualized Applications and Desktops

Nearly ten years ago, VMware created the initial market buzz around VDI. When VMware initially released View, Citrix had a strong multi-user server-based solution in XenApp but instead chose to defensively tackle virtual desktops on its level. The market was buzzing with the term VDI, and CIOs and CTOs wanted it without a clear understanding of the complexity and whether they even really needed it.

VMware created excitement and took the offensive position, while Citrix countered the challenges in a reactionary way. Citrix was so busy playing defense that it neglected the primary application virtualization product that the market loved: XenApp.

Finally, with the XenApp 7.5 release in early 2014, XenApp was once again on the offense, but VMware countered several months later with Horizon View 6.0, with its new capability to offer users virtualized applications. Since then, VMware and Citrix have each improved both their application and desktop virtualization solutions.

Every time VMware or Citrix sells its virtualization solutions, the cash register rings for Microsoft because of additional license requirements. In addition, Microsoft offers its basic Terminal Services/Remote Desktop Services capabilities and provides some enhancements with each release.

Hypervisor

VMware vSphere has been the de facto on-premises hypervisor for well over a decade. Citrix XenServer and Microsoft Hyper-V simply have not been able to achieve such success in the market. Admittedly, Hyper-V is fairly complex, and many customers lost faith in XenServer when Citrix wavered on the future of the product in 2013. On the plus side, the monitoring and management features of vSphere make it especially appealing to many organizations.

Because the hypervisor is such a fundamental aspect of the data center, once VMware is entrenched, the likelihood of changing hypervisors is minimal. However, when moving to a big data center in the sky, the hypervisor is an afterthought and largely irrelevant—rather intentionally.

The Cloud as the New Playing Field

Rather than continuing the one-upmanship skirmish, Citrix and Microsoft just changed where the game would be played and rewrote the rules. They combined forces and moved the playing field from the on-prem data center to Azure. They are continuously making it more and more inviting to consume the cloud in increments—starting out with disaster recovery, flexible expansion, and Office 365—with the clear intention of having enterprises abandon their in-house data centers in favor of the cloud.

When moving to the cloud, the hypervisor becomes a non-issue for the subscriber. The hypervisor is embedded into cloud packaging and is comparable to not knowing or caring about what kind of wireless chip is embedded within your tablet device. As a result, the vSphere side of VMware is likely getting nervous. If cloud does indeed overtake on-prem, will vSphere become as antiquated as dial-up modems?

In terms of virtualized applications and desktops, VMware responded to Citrix Cloud with the Horizon Air, but it lags at least a year behind Citrix in its endeavor to move to the cloud. VMware has teamed with Amazon Web Services as its cloud service. Ironically, AWS is a well-known Xen hypervisor user.

With two of the three virtualization industry powerhouses teaming up together in the cloud, it becomes more difficult for VMware to counter. In light of the hypervisor discussion above, the battleground between Citrix/Microsoft and VMware will likely default to virtualized applications and desktops rather than the hypervisor.