Microsoft is to offer "the full VMware stack on Azure hardware" with the help of an as-yet-unnamed VMware partner.
Redmond's announcement stated that the company has commenced a preview of "a bare-metal solution … co-located with other Azure services" and "in partnership with premier VMware-certified partners".
Sources tell The Register one partner is a startup exiting stealth, but not an entirely new organisation. We also understand that the announcement of the service was made earlier than Microsoft had originally intended, in part to draw attention away from AWS's re:invent gabfest next week.
Microsoft has not yet explained licensing, revealed price or other details of the service, other than to say it will become available at some point during 2018.
The company has, however, shown its hand by also launching a VMware-to-Azure migration service that can shunt even applications spanning multiple servers into the Microsoft cloud. It has also, in this total cost of ownership guide [PDF], crunched the numbers to show that shedding your vSphere licences and adopting Azure reserved instances will save you big bucks.
Migration of workloads on vSphere to Azure is Microsoft's clear preference, as it has positioned the VMware-on-Azure service for "specific VMware workloads that are initially more challenging to migrate to the cloud".
The most revealing part of Microsoft's announcement is its swipe at VMware's cloud connections.
"The reality is, running your VMware virtualization stack in the cloud does not address your hybrid requirements," Redmond's announcement said. "For this, you need a broad set of hybrid services and solutions that provide not just connectivity and virtualization, but true consistency across your cloud and on-premises environments."
That's a polite way of pointing out that VMs on someone else's computer are still just VMs, but that a cloud provider's services offer more value to developers.
Microsoft is right to point this out: VMware does have a very fine stack that spans on-premises, cloud and managed service providers, but as its VMware-on-AWS service is immature it currently lacks a full suite of cloud services for developers to tap.
Redmond's argument is therefore potent, as infrastructure-as-a-service and cloud-native applications are all big leaps forward, and competent organisations will need to investigate them as they evolve their IT. By pointing out that VMware can't take users as far, as quickly, as Azure, Microsoft will have the ear of many organisations.
Whether it will do more than peel away some VMware users who were already susceptible to a move is the big question.
VMware will be confident the migration offer is just marketing as usual and not an existential threat. Microsoft's previously offered migration tools and licensing incentives to VMware users, and they didn't noticeably dent the company. Indeed, VMware was forced to reverse its previous advice that vSphere sales would decline. The company is confident in the value proposition of its software and has worked hard to make it more relevant to more types of workloads.
VMware therefore won't fret over Microsoft's new effort.
Nor will it worry overmuch about its partners helping Microsoft to run vSphere in Azure, because someone, somewhere, will still be paying for licences. And those who take up Microsoft's offer to VMware run in Azure will still be using vSphere!
Indeed, VMware could even see Microsoft's moves as validating the appeal of VMware-on-AWS. Virtzilla has said demand for that new service is strong. It would therefore not be hard to paint Microsoft's move as an attempt to get into a hot market, rather than a direct competitive threat.
Having said that, server virtualization is a rare example of a market in which a hard-charging Microsoft failed to overrun a market-maker. Microsoft's never been entirely happy with Hyper-V's small market share.
With cloud offering the chance to adopt significantly different ways of running infrastructure and software development, it now has rather more to offer than Hyper-V's initial me-too approach.
The Register has asked Microsoft and VMware for comment and will update this story if they have anything to say, or anything that renders our analysis impotent.
A last thought: The Reg understands that even more convoluted cross-cloud concoctions and deeper VMware/AWS integrations will emerge next week. This ain't over by a long shot. ®