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Examine the growing role of VMware in the IoT market

In a growing IoT market, VMware decided to focus on system management. Although users might not bet on VMware to become an IoT market leader, the company has its strengths.

The IoT market has great potential, which attracted VMware and a slew of other vendors. VMware has concentrated its efforts on the emerging IoT management market. Although VMware has a strong foundation in system management, it must extend into new areas to become an IoT market force.

Interest in IoT devices is high. Worldwide spending on such technology is expected to reach $745 billion in 2019, an increase of 15.4% over $646 billion in 2018, according to IDC's Worldwide Semiannual Internet of Things Spending Guide.

The market's future looks bright: IDC reported that it expects IoT spending to maintain double-digit annual growth from 2017 to 2022 and surpass the $1 trillion mark in 2022.

IoT on the rise

IoT technology enables businesses to collect information from new endpoints and improve their operations with that data -- in some cases, quite dramatically.

"IoT has the potential to support transformative change so corporations [can] gain operational efficiencies," said Michele Pelino, principal analyst at Forrester Research, a market research company based out of Cambridge, Mass.

Organizations deploy IoT devices to help with business process efficiency, cost savings and product quality improvement, according to IDC's latest Global IoT Decision Maker Survey.

IoT endpoints range in scope dramatically, from sensors on manufacturing systems to smartphones. And IoT device use cases include manufacturing, urban planning, building facility management, field service operations, utility energy management and health care.

Building up the infrastructure

The underlying infrastructure for IoT has taken shape.

"Costs are now reasonable, and all of the technology needed to deploy these systems is in place," Pelino said.

IoT has the potential to support transformative change so corporations [can] gain operational efficiencies.
Michele PelinoPrincipal analyst, Forrester Research

Yet, the market has adopted IoT slowly. A number of corporations implement IoT applications, but such implementations are early adoptions rather than widespread deployments.

"The challenge has been bringing all the different pieces together," Pelino said.

A variety of technologies -- such as networks, end devices, applications, system services, platforms and data analytics -- must align.

Organizational issues create other problems. Deploying an IoT system doesn't always correspond to traditional IT processes. In many cases, a business line manager must oversee the process. In manufacturing, operational technology staff oversee the plant technology, and IT staff oversee office systems. Those groups must align as well.

VMware's focus on system management

VMware tried to make its mark with its Pulse IoT Center management suite. In April 2019, the vendor announced a new SaaS-based Pulse IoT Center version, with a simplified process for adding more types of IoT devices, heterogeneous environment functionality, managed containers and easier security administration.

The vendor picked an area of need.

"Like many aspects of the internet of things, IoT device management is complex," said Stacy Crook, research director for IoT at IDC. "There are many types of IoT devices … that may need to be managed over a broad variety of network types. … Organizations may also prefer to have IoT devices communicate with and be managed by edge servers … because of concerns about security, latency, cost or unreliable network access."

But the individuals buying IoT systems might not have had many interactions with VMware, so the vendor must broaden its reach. IoT must manage devices such as sensors, which VMware has little experience with.

Various IoT application platform vendors, such as Microsoft, AWS, IBM and SAP, also include device management features in their products. VMware doesn't.

"Analytics is an area where more management functionality is needed," Pelino said.

IoT devices generate a lot of information. Increasingly, management vendors add AI and machine learning features to their suites to help companies sift through the large volume of data. As of September 2019, VMware hasn't included this either.

VMware's IoT strengths

VMware has many potential IoT strengths. The company has built out a multivendor data center management suite with many features.

"We find that many organizations have more than one IoT platform in place. VMware solutions can be used for device management across multiplatform environments," Crook said.

IoT management is complex. No vendor can supply all of the necessary management functions on its own, so vendors must make partnerships. Recently, VMware teamed up with AWS, Microsoft and IBM for its data center management tools. It could build on that experience to expand into IoT territory.

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