There’s been a rumor going around that Yahoo is planning to sell Zimbra to VMware. Zimbra is one of the more popular providers of open source email. If this is true, the takeover will not be without certain implications for VARs and managed hosting services providers, especially in the Software as a Service industry.
Zimbra currently rakes in 60 to 70 percent of the company’s revenue from its channel partners. About 450 of these partners host Zimbra’s open source email for their clients. In 2007, Yahoo has bought Zimbra for approximately $350 million. The brand’s channel partner strategy seemed promising says The VAR Guy’s Open Source 50 report. But Yahoo has been reconsidering its business strategy in response to fierce competition with Microsoft Bing and Google. This has brought about the rumors of a potential Zimbra sale that have been going around for a couple of months now. The latest in the rumor mill is that VMware is looking into purchasing Zimbra.
If VMware manages to acquire Zimbra and its open source email, this could bring forth more intense competition between Zimbra/VMware and Google Apps as far as the university market is concerned. The new tandem may also toughen up against the Business Productivity Online Suite by Microsoft which included hosted Exchange. There’s also a possibility that Open Xchange, another upcoming open source email provider will be facing tough competition in the SaaS industry.
Aside from all these, it seems that Zimbra can potentially play a crucial role in the showdown between Red Hat and VMware. Zimbra is currently partnered with the Red Hat Enterprise Linux Team. But as the latter is pushing for Red Hat Enterprise Virtualization this year for its servers and desktops, it is essentially coming up against VMware.
