Long-time VMware customers have been confused over the past several years with the vendor changing hands multiple times and rebranding to Omnissa.
IT administrators and business leaders who run this vendor's technologies in their environment should keep up to date with the latest developments on who is in charge at Omnissa, how it got to this point, and what they can expect moving forward.
The history of Broadcom's acquisition of VMware
In November 2023, Broadcom completed its acquisition of VMware. That, of course, affected all VMware partners and customers, but one area was affected as much or more than any: those working on end-user computing (EUC) software from VMware. This is because Broadcom announced they were planning to divest that branch of VMware, which meant as much as they wanted to sell it to whoever was interested. In 2024, Broadcom sold the EUC branch of VMware to an investment company for it to continue under its own brand: Omnissa.
Before looking at the present situation for the EUC products, it can be helpful to consider where VMware came from and how its EUC stack evolved. The vendor was founded in the 1990s with the goal of providing virtualization technology with their ESX hypervisor -- today that technology has evolved to ESXi.
In the early years of the 2000s, it became the market leader with its enterprise-level virtualization stack and desktop and server products GSX Server and Workstation. Since then, the company has evolved into a software giant with products in many fields, including network virtualization and security, storage virtualization, edge computing, multi-cloud workload management, and EUC products. Its first product in that area was for virtual desktops. VMware developed that product, which had been around since 2008, first named VDM, then changed to View and most recently under the name VMware Horizon. VMware became one of the largest players in virtual desktop infrastructure (VDI) as well. Then, in 2014, VMware acquired AirWatch, a leading provider in enterprise mobility management. That boosted the EUC branch of VMware to become a large business unit within the software giant.
For many years, VMware went through product cycles and market visions under several CEOs. Most recently, Paul Maritz was replaced by Pat Gelsinger in 2012 who cleared the field for Raghu Raghuram in 2021. In those past years, the company did not always follow a straight path. At times the messaging changed regarding issues such as moving to the cloud or not, and how to embrace container technology.
But the hypervisor and related products such as NSX and vSAN were always reliable for the basis of a data center. And so was true for the EUC products that were rebranded to VMware Workspace One for the parts that came from AirWatch, with the name VMware Horizon remaining in place for VDI products.
After its acquisition of VMware, Broadcom looked at the VMware portfolio and probably found that the offerings were too diverse. And, therefore, it decided that the EUC products no longer fit into the company's future roadmap.
A brief history of VMware leading into its acquisition in 2023.
Who owns Omnissa?
In early 2024, U.S.-based private equity and investment company KKR announced they signed an agreement to acquire VMware's EUC division. That process was completed in July 2024 and the business has since continued in a new standalone company named Omnissa.
To answer the question about who owns Omnissa is to answer two questions: Where's the money and who's in control? Given the scope allowed of this article, it's not worth getting into the entire financial structure. But the biggest piece of public information is the fact that KKR paid the sum of $4 billion. So technically the shareholders of KKR own Omnissa.
Most importantly, the senior vice president and general manager of the EUC business unit, Shankar Iyer, became the CEO of the newly founded company.
But who's in control of the Omnissa business? With the divestment from Broadcom, many employees, including management team members, moved from Broadcom to Omnissa. Most importantly, the senior vice president and general manager of the EUC business unit, Shankar Iyer, became the CEO of the newly founded company. With that, the new owners of Omnissa -- KKR -- assured employees and customers that the new company will move forward down the same road.
There is one other aspect to the ownership that is noteworthy. Since 2011, KKR has started to implement co-ownership for the companies they invest in. It also did so for the 4,000 VMware employees who moved over to Omnissa. In their press release, they explained this as follows:
"After becoming a standalone company, the EUC Division will implement KKR's broad-based employee ownership program, which makes all employees owners in their respective businesses alongside KKR."
This doesn't mean that employees now have a vote in the direction of the company. But it should get them more engaged with the company knowing that they will benefit from the company's success. But it doesn't mean that they can easily cash in if the company's value increases because their ownership only turns into real value if the company is again sold or brought to the market with a stock exchange notation.
What's next for VMware?
With the acquisition by Broadcom, the EUC business was split off and Carbon Black was merged into Symantec. But the largest part of the software stack that VMware had remains within the company. The biggest change that customers have seen is the shift to a subscription licensing model and the simplification of product offerings.
Customers can choose to purchase VMware Cloud Foundation (VCF), which is the entire suite of products with the ESXi hypervisor, vSAN, NSX and Aria for management and automation. Or they can go for vSphere Foundation, which is "simply" the hypervisor. From Broadcom's perspective, this simplifies things, but not all customers and partners are very happy with this, according to the many discussions that can be found online. This is especially true for cloud service providers that sell their VMware resources -- they have seen such increases in costs that some of them have moved away to other alternatives. Corporate customers running the VMware stack have also seen increases in license costs.
But when customers evaluate their options, there are still good reasons to remain with the software vendor they have invested in for their infrastructure. For 2025, customers can expect an update to the entire software stack with VMware Cloud Foundation version 9. VCF 9 is also in the works, and it will offer even tighter integration between former VMware products and more possibilities to import existing deployed products into VCF.
Rob Bastiaansen is an independent trainer and consultant based in the Netherlands specializing in VMware and Linux. He writes articles for several print and online publications, and is founder of VMwarebits.com, a site dedicated to technical content related to VMware.
