VMware Inc.(VMW) and Hitachi Ltd (HIT) entered into a strategic partnership to enable Hitachi to provide cloud-based services to financial institutions across Asia. These institutions will now be in a position to adopt the virtualized infrastructure that simplifies infrastructural management and improves business capability in a secure and efficient cloud-based environment.
VMware and Hitachi will also combine their technical know-how and marketing initiatives for this new service, which will be provided through a private cloud.
A private cloud is designed as per specific organizational needs that require more control over their data. It is limited to the use and accessibility of one particular organization, as against the public cloud, which has larger accessibility. Private cloud computing is more secure compared to public cloud as the former provides hosted services to a limited number of people within a firewall.
Private Cloud for Finance Institutes, as the new service is named, has VMware’s virtualization infrastructure and cloud computing techniques that will enable organizations to be more cost effective, raise operational efficiency, increase scalability, strengthen security and provide solutions for critical business issues, thereby ensuring smooth business functioning. The service will also enable application developers to create applications according to their specific needs making use of other resources in the cloud.
The Private Cloud for Finance Institutes has VMware vSphere and the VMware vFabric as its cloud application platform and will enable Hitachi to deliver cloud-based services to its customers.
We believe that the partnership will significantly benefit VMware, as it will gain traction in the Asian market. We expect further wins such as this one, as organizations are increasingly looking for private cloud solutions and applications that are more secure and available in a more controlled environment.
VMware is on an acquisition spree, as the company continues to strengthen its end user computing model. It has recently acquired Socialcast, a social collaboration provider, the third acquisition after SlideRocket and Zimbra. VMware has been working on the virtualization of servers and transformation of the PC. This would help the organizational workforce access and derive data that could eliminate location problems, thereby increasing productivity through new-age collaboration and communication models.
We believe the increasing adoption of virtualization and cloud computing technologies will drive growth for VMware over the long term.
Enterprises that are shifting to the cloud need proper infrastructure, which VMware provides through its four key products: vSphere that helps in coordinating and automating computer storage and networking; vShields for virtualized Edge functions and security; vCloud Director to enable cloud functionality; and the recently launched vCenter Operations Suite for management.
We believe VMware is the biggest beneficiary in the adoption of cloud computing and the corresponding shift in IT environment. The server virtualization market possesses huge potential and VMware continues to expand its presence in the datacenter cloud management and security segments.
We have an Outperform recommendation on VMware over the long term (for the next 6 to 12 months). Currently, VMware has a Zacks #2 Rank, which implies a Buy rating on a short-term basis.
HITACHI (HIT): Free Stock Analysis Report
Be the first to comment