$1.6bn VMware defence deal challenged by AWS, Citrix and Nutanix

Exclusive deal would see Virtzilla own US defence IT for up to five years

Amazon Web Services, Citrix and Nutanix have protested a US government plan to sign a US$1.6bn software and support contract with VMware.

Virtzilla's wares are widely used in the US military, which appears pleased with the company's products but unhappy with procurement arrangements. A Justification For Other Than Full And Equal Open Competition document (popup PDF) therefore suggests that if the US Army, Navy, Air Force, Defence Information Systems Agency and other arms of the military strike a single deal with VMware, it will “reduce administration of over 9,270 VMware procurement transactions which have occurred over the last five years.”

In other words, less paper-shuffling means more pointy end action if we buy from VMware and VMware only.

The document linked to above includes most of VMware's main server and desktop virtualisation products. A list of “Non Enterprise Software” adds Horizon Desktop as a Service, NSX and VSAN.

It's also thought that the the deal will steer plenty of cloud business VMware's way.

Just why Nutanix, AWS Citrix and veteran-owned technology services firm Minburn technology Group have objected isn't known: the US government Government Accountability Office lists the objections but doesn't link to the actual complaints.

At a guess, Citrix parnter Minburn wants a chance to sell to defence agencies, Citrix is angry because it doesn't want VMware gaining a total lock on VDI. AWS would rather VMware did not give defence agencies a private on-ramp to vCloud Air, as that would reduce the likelihood of those agencies using its cloudy offerings. Nutanix's motives are harder to guess, but the company reckons it offers a better way to do VMware and will probably be worried its prospects diminish if VMware wins a colossal contract.

VMware itself has, in recent earnings calls, mentioned a whale of a deal with the US government that is proving hard to land. If this is that deal, VMware's federal sales team has an even harder job ahead of it while these objections are considered.

Happier news for VMware comes in the form of the appointment of Bask Iyer as the company's new CIO and veep. Iyer is currently Juniper Networks' CIO. Jumping from the ailing networking company to the vigorous VMware can't have been a hard decision. ®


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