VMware chief technology officer Stephen Herrod admitted that the cloud "might be the most abused phrase since virtualisation," but the goal of providing highly scalable and elastic computing resources that can expand and shrink as needed and be accessed from anywhere is real.

A lot of VMware customers want to be just like Google, according to Maritz. "They think Google has this giant computer they can flexibly deploy applications on top of, and that's what they aspire to achieve," Maritz said. The idea is to operate an "internal cloud," and act as a "hosting provider to internal customers," he said.

This will require more flexible and efficient methods of delivering computing resources, where virtual machines can be moved around at will, independent of the hardware they run on, VMware said.

"What's interesting is that while many of the clouds you hear about are associated with high-performance computing or web 2.0, what I heard here showed that they're thinking more about an enterprise cloud, a cloud that will support enterprise applications with some guarantees about service-level agreements," said IDC analyst Jean Bozman.

The largest companies might operate their own internal clouds, while others will contract with service providers that offer computing resources over the web with the help of VMware technology.

"It's going to be a departure from a lot of the cloud stuff we've seen already," Bozman said. "It's going to have more of the characteristics of software-as-a-service, where you expect to get something like a packaged software functionality. It's not just for developers who are writing web applications, it's not for high-performance computing where you're doing a lot of custom stuff. The intention is to provide for you what you would have gotten from ... your own data centre."

None of VMware's technology announced at VMworld will be available until sometime next year. Key announcements include the Virtual Datacentre Operating System (VDC-OS), which aggregates virtualised servers, storage and network resources into one big computing pool that serves up computing resources to applications, providing a better level of availability and scalability, the company says.

For example, the VDC-OS will be able to manage as many as 4,096 processor cores in a single pool of resources, Herrod said.

Secondly, VMware announced vCloud, an initiative that partners VMware with more than 100 service providers - such as Savvis, Verizon, AT&T, Rackspace and British Telecom - that are using VMware's technology to offer Internet-based computing clouds. VCloud "will connect internal data centres and external service provider offerings together seamlessly, enabling enterprises to adopt cloud-based services," VMware says.

The Virtual Datacentre Operating System concept is "intriguing," IT analyst Laura DiDio says. But to be successful, VMware must go out of its way to train customers, who often are dealing with tight budgets and using products 18 to 24 months older than the most cutting-edge technology.

Virtualising a few servers and deploying basic disaster recovery tools is relatively simple compared with the kind of overall data centre management schemes VMware is now talking about.

"They have to match theory with actual usage," Didio says. "You know, it's got to be vetted. ... A lot of customers are leaving the comfort zone. These things are increasing in size, scope and complexity. A lot of these organizations do not have the time nor the funds to send their IT people out for training."

Even customers who are virtualising large portions of their data centres may not want to deploy the VDC-OS immediately.

"We'll test it out, we'll work with it in our labs and we'll see how it works. We're not rushing into that," says Aaron Andrews, director of distributed systems at First American Corporation in California. Andrews says his company takes an approach that assumes pretty much any workload can be deployed on a virtual server, but there's still work to be done in educating business users.

"We have business units that have adopted it, and we have business units that don't know what virtualisation is," he says.

Kris Jmaeff, a senior data centre analyst at the Interior Health Authority in British Columbia, says forthcoming VMware technology like the VDC-OS, and increasing willingness by software application vendors to support workloads running on virtual machines, will help the organization move closer to a fully virtualised environment. Currently, about half the authority's physical servers are virtualised. "By the next generation [of VMware's technology releases] we'll be able to virtualise almost everything," he says.

In addition to VDC-OS and vCloud, VMware discussed a few more technologies designed to increase data centre flexibility. Herrod said VMware will introduce live migration for storage, allowing virtual machines to be moved from one piece of storage to another without any downtime.

Herrod also promised improvements to VMware's High Availability software, which responds to hardware failures by automatically sending virtual machines from one box to another when the original host machine goes down.

"We want applications to be better than physical," Herrod said. "If that physical piece of hardware dies we seamlessly move over to a second physical machine."

Beyond the specific technology announcements, the sheer scope of VMworld demonstrated how important virtualisation is to the IT industry today, noted Yankee Group analyst Phil Hochmuth.

Seemingly every IT company had a product announcement to make at VMworld, and big players like HP, IBM, Cisco, Dell and Intel delivered keynote addresses.

"To me, this is like the new Interop," Hochmuth said. "Everyone wants to get into virtualisation, they want their brand or their company to be associated with virtualisation the way every technology company wanted their brand to be associated with the Internet seven years ago."

About 14,000 people attended VMworld, including representatives from Microsoft, who tried to rain on VMware's parade by distributing fake casino chips directing attendees to a web site titled "VMware costs way too much."

The Microsoft-hosted site says "Looking for your best bet? You won't find it with VMware," and provides several links to virtualisation pages on

Maritz, reflecting on his own experience as a Microsoft executive, said he's been guilty of conducting similar types of subversive marketing campaigns.

"That's the kind of thing you do when you're trying to get your foot in the door," he said. "These things are more for your own emotional satisfaction than anything else."