VMWare Bags AirWatch
VMWare Bags AirWatch by Michael F. Finneran
We’ve certainly seen a lot of change in the mobile device management field over the past few years, and VMWare added to that yesterday when it announced it would be acquiring the self-proclaimed market leader AirWatch for about $1.54 billion. The AirWatch team will remain in place led by chief executive officer John Marshall and will become part of VMware's End-User Computing group, led by Sanjay Poonen, EVP and GM. Alan Dabbiere, AirWatch's co-founder and chairman, will be overseeing a new AirWatch operating board, which will report to Pat Gelsinger, VMware’s chief executive officer.
This news is in line with a prediction I made some time ago that mobile device management will soon cease to exist as a standalone market. That is not to say that the business of managing the growing diversity of mobile devices, both company-provided and BYOD, will not continue. In fact, the scope of that responsibility is expanding to include mobile applications management (MAM) and mobile data management (MDM). As a reflection of that we are seeing the “MDM” moniker giving way to the more expansive “Enterprise Mobility Management” (“EMM”).
The move to MDM/EMM grew out of the wholesale abandonment of the BlackBerry platform and the need to secure corporate data on a wider variety of user-owned and company provided mobile devices. As a result, sales are booming. Gartner Inc. estimates the market for mobile-device management software will reach $1.6 billion in revenue this year, up from $784 million in 2012. TheInformationWeek 2013 Mobile Security Survey found that 39% of organizations had already implemented MDM solutions (up from 30% in 2012), and another 33% had them in their plans.
Growth in the MDM space has sparked something of an acquisition binge. In 2010, SAP acquired Sybase and its Afaria MDM product for $5.8 billion. Then in March 2012, security specialist Symantec acquired two mobile software firms: Odyssey Software that made an MDM solution for the Microsoft System Center Configuration Manager (SCCM), and mobile security firm Nukona. In January 2013, VMWare rival Citrix snapped up privately held Zenprise, and finally in November, IBM announced it was acquiring cloud-based MDM supplier Fiberlink; the value of those last two transactions was not disclosed. As it stands now, the only independent MDM companies positioned in the Leaders Quadrant in Gartner’s 2013 Magic Quadrant for Mobile Device Management Software are MobileIron and Good Technologies; my bet is that neither will be independent by the year end.
What appears to be driving the acquisition activity is the fact that growth in other segments of the software market is slowing, so the big players are on the prowl for fast-growing niches they can buy into. That is coupled with the fact that mobility is hot, or as VMWare CEO Pat Glesinger put it in an interview, “We clearly saw the puck was going to mobility.” Research Director for Networking and Information Security Daniel Kennedy at the 451 Group wrote in the Reference Technology Roadmap for 2013, “Mobile device management (MDM) had the strongest spending intentions in 2013; 41% of respondents said their enterprises increased spending as a management response to employees’ ‘bringing your own devices’ (BYOD) to work. Spending on MDM is expected to improve in 2014, with 46% of respondents planning to increase spending.”
So now the interest shifts from the vanishing MDM market to the plans of the acquirers. Two of the more interesting players will be VMWare and Citrix. Both have virtual desktop integration (VDI) solutions with mobile clients for access; given the screen size requirements, those applications are best suited for tablets. In a mobile environment, the appeal of VDI is that you have a secure connection to the server regardless of the underlying mobile network, and since no corporate data is stored on the device, if the tablet goes missing, no corporate data is exposed. With VMWare acquiring AirWatch and Citrix picking up Zenprise, each will have an MDM solution for those customers who do need to store data on their mobile devices.
IBM, SAP, and Symantec have all gotten in on the action, even if some of them were turning their backs on their own solutions (e.g. IBM’s Endpoint Manager for Mobile Devices). In any event, there seems to be an assumption in the market that if you’re going to be taken as a “serious player” in the mobility space, you need a top-shelf MDM offering in your bag. With only MobileIron and Good Technologies still in play, someone will likely be reaching for the checkbook. Two names we might expect to see jumping in are HP and Microsoft.
The big question is, will this be a step forward or a step backward for enterprise mobility management? The small, hard driving specialist companies are getting rolled into larger more diversified software conglomerates who don’t necessarily share the laser-focus of a specialized niche. As the enterprise mobility market continues to evolve, we will need these sorts of tools to effectively manage the growing population of mobile devices, and hopefully the process of folding the MDM pioneers into larger entities does more than burden them with an excess of big company bureaucracy.