In their Q3-2014 VMware results for shareholders, the revenue from “services” is 30% larger than licensing revenue. This slides show a total revenue of $1.5B for the quarter but license revenue is only about 42% of total revenue, the bulk of revenue is services.
And this next slide shows that total revenue is growing at 18% while license revenue is growing at 13%.
Another data point: VMware recently hired Dom Delfino away from Cisco to manage the delivery of professional services.
Any Impact For Customers ?
I’m not sure. Once again, as a network architect I am looking at the company performance to understand the way VMware runs their business. Knowing that 60% of revenue for VMware comes from professional services leads me to ponder the following questions:
- why does VMware have so much revenue from engineers or services ?
- where this revenue is coming from ? Is is maintenance/support or directly provided consulting services ?
- if VMware is planning to grow professional services revenue in the same way that Cisco says, then what does that mean for resellers ?
- will VMware offer me consulting services and shove them down my throat during the next sales cycle ?
- What would be the value to my business of these services if they were offered ?
On a financially self-interested basis:
- Is VMware over-charging me for maintenance ? The growth of service is larger than licensing. So, discounting of licenses or increases in software maintenance ?
As they used to say on Saturday Morning television, “Answers on a Postacard, please” (or use the comments below).