EMC is keeping up appearances that its VMware subsidiary is still a separate company. Today, it transferred a number of system management products that were part of its evolving Ionix brand to VMware for $200m in cash.
Last July, after five years of making systems management tool acquisitions, EMC slapped the Ionix brand on the whole shebang. The Ionix tools included a scanning program for servers and networks to see all the hardware and software running on the corporate network, a root cause and impact analysis program, a service management help desk, and server management and network provisioning tools.
Last August, when EMC acquired FastScale, it got its hands on a clever server and application provisioning tool called Composer Suite, which rounded out the Ionix stack. EMC did not disclose the financial details of most of the acquisitions it made to create the Ionix suite, but under the agreement VMware gets the technology and intellectual property behind FastScale, Application Discovery Manager, Server Configuration Manager, and Service Manager for that $200m.
VMware is also taking on board all of the employees associated with the engineering, marketing, sales, and support of the Ionix products. It will continue to operate facilities related to the Ionix products in the United States, Israel, Europe, India, and Australia.
Oddly enough, EMC is keeping the Ionix brand, perhaps to recycle some day in an entirely different line.
The rational for moving the products over was to allow VMware to boost its vCenter virtual machine and hypervisor management tools. Basically, VMware needs to do real server and network management because not all servers and networks are virtualized, and not every box will be running the vSphere stack and its ESX Server hypervisor.
EMC could have always filled that heterogeneous function, and indeed, that seemed to be the plan all along, but for whatever reason, EMC has decided that VMware is the better vehicle through which to drive its systems management aspirations through the data center doors. VMware's products are used by a lot more customers than EMC's are, so this is not foolish. But the change does make VMware deal with pesky physical infrastructure now, and perhaps other hypervisor too.
As part of the agreement, which oddly enough needs regulatory approval even though EMC already owns a majority stake in VMware, EMC becomes a reseller of the Ionix tools it has shuffled off to Palo Alto, which will be rebranded yet again as soon as the deal closes.
The two companies said that the transaction would not have a material impact on their revenue or profit expectations for 2010 and that it would close in the second quarter. ®