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VMware Snaps Up CloudHealth for $500M to Enhance Cloud Management Capabilities

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In a strategic move to bolster its cloud management offerings, VMware has successfully acquired CloudHealth, enhancing the company’s ability to provide multi-cloud management solutions. As businesses increasingly adopt multiple cloud platforms, managing these environments poses challenges due to information silos created by disparate cloud applications.

The acquisition, valued at approximately $500 million in August 2018, positions VMware to address the complexities of managing cloud costs, a critical concern for organizations utilizing public cloud services. CloudHealth initially focused on tracking and optimizing cloud computing costs, recognizing that companies often exceed their anticipated spending when transitioning to the public cloud.

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The challenge of managing cloud costs arises from the dynamic nature of cloud services, offering rapid resource allocation but sometimes resulting in inefficiencies. CloudHealth’s capabilities include tracking top options from key suppliers, aiding organizations in navigating the multitude of configuration choices offered by cloud vendors.

Beyond cost management, VMware is expanding its cloud management portfolio to encompass multi-cloud automation and orchestration (Cloud Assembly), cross-cloud monitoring (Wavefront), cloud security assessments (CloudCoreo), and workload mobility (CloudVelox).

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While VMware’s product lineup and acquisitions currently operate independently, the company aims to integrate these offerings into a comprehensive suite. This suite is designed to provide unified performance management, operations automation, security, compliance, and cost management across major public cloud services.

Despite the ambitious plan, challenges lie ahead as creating a unified and integrated suite is complex and time-consuming. The company faces competition in the multi-cloud management space from major players like Microsoft, which acquired Cloudyn in 2017, as well as other vendors such as Apptio, Cloudability, Embotics, Morpheus, RightScale, and Scalr.

VMware’s CloudHealth acquisition signifies a crucial step in strengthening its position in the rapidly evolving cloud management market, providing the company with essential cost management capabilities. As organizations continue their multi-cloud journey, VMware aims to offer a comprehensive solution to streamline operations, enhance efficiency, and ensure optimal resource allocation across diverse cloud environments.

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