is upping its stake in mobile technology. On Wednesday, the company said it will buy mobile management and security
start-up AirWatch for $1.54 billion.
Pat Gelsinger, VMware's CEO, said in a statement that AirWatch "provides best-in-class, secure, enterprise -mobile management to thousands of businesses around the world." He added that the purchase will "add a foundational element to our end-user computing portfolio" so that customers can boost their mobile force's capability without compromising security.
Under the deal, VMware will pay $1.175 billion in cash and $365 million in installment payments, plus will assume unvested equity. The AirWatch team will remain intact and continue to report to its founder and CEO, John Marshall, and will become part of VMware's End-User Computing group. AirWatch's Atlanta office is expected to become the hub for VMware's mobile operations.
With more than 10,000 customers and 1,600 employees in nine offices globally, the Atlanta-based AirWatch provides software for device management, application management, content management, security, e-mail management and browsing management in the mobile space. It also offers laptop management and multi-user management, and supports Android, iOS, Mac OS, BlackBerry, Symbian, Windows Mobile, Windows PC/RT and Windows Phone.
Alan Dabbiere, co-founder and chairman of AirWatch, told news media that joining VMware means his company now has "an opportunity to bring our leading-edge solutions to an even broader set of customers and partners."
As the data center-based virtualization market gets crowded and growth opportunities are fewer, VMware is looking to bolster its ability to offer virtualization, application delivery, mobile management, security, cloud and other solutions for the fast-growing mobile market.
Device- and Platform-Agnostic
Charles King, an analyst with industry research firm Pund-IT, told us that VMware has "had a pretty strong play in certain parts of the mobility market," such as with their Horizon Suite product that provides virtualization tools for provisioning data and apps for smartphones as well as laptops and PCs. With this purchase, he said, the company is "broadening that portfolio and adding security features."
King said that "what's interesting is that VMware's approach is device- and platform-agnostic," and, with AirWatch's "sizable customer base, this should pay off well for VMware."
On Wednesday, VMware also reported its fourth-quarter earnings, which, with revenues of $1.48 billion, showed a 15 percent increase over the same quarter in 2012.
On Monday, AirWatch announced its Teacher Tools to "balance the device management role at schools between IT and teachers" by providing basic management control to teachers and thus minimizing IT's responsibility. The tools offer capabilities for personalized student instruction in a "flipped model" where students follow device-delivered lessons and teachers assist.
Earlier in January, AirWatch unveiled a new Mobile Email Management solution, its AirWatch Inbox for iOS that allows for the separation of personal e-mail from enterprise e-mail.