David Goulden, chief executive officer of EMC II.
EMC

With VMware keeping its cloud, EMC II focuses 100% on Virtustream

By Barb Darrow
December 15, 2015

On Monday, VMware officially pulled the plug on plans to combine its vCloud Air product with EMC’s Virtustream cloud portfolio. That had been the grand plan laid out by EMC Chief Executive Joe Tucci to rationalize several different cloud businesses from the various EMC Federation companies.

Now, unsurprisingly, EMC’s EMC Information Infrastructure group (EMC II for short) will focus on helping Virtustream sell into big companies running mission-critical applications, according to an internal memo from EMC II Chief Executive David Goulden viewed by Fortune.

Goulden wrote:

“I’d like to make clear—beyond any doubt—that we, as EMC, are 100% prepared to make those commitments in support of Virtustream’s mission to become ‘the’ leading Cloud Service Provider in mission critical enterprise-class cloud IaaS and hybrid cloud.

EMC II sells storage and associated software into big business accounts and is the direct heir to EMC’s decades-old storage business. Other federation members include VMware VMW , RSA, VCE, Virtustream, and Pivotal. EMC owns 80% of VMware and bought Virtustream in May for $1.2 billion. EMC and VMware share ownership of Pivotal. You see the complexity here.

But back to cloud. Going forward EMC II will move its existing EMC storage managed services offerings, VCE cloud managed services, and its Rubicon object storage service into the Virtustream cloud unit, under chief executive Rodney Rogers.

Goulden also said Virtustream will be part of the vCloud Air Network, although it’s unclear what, exactly that means given that Virtustream and vCloud would often compete for the same business accounts. And nothing says hypercompetitive like an EMC (or a VMware) salesperson. (Except maybe an Oracle salesperson.)

EMC had no comment on this story.

For all the talk of EMC Federation companies being able to sell both with each other and against each other, it’s hard to see how this will work in the field given that Team EMC faces prodigious competition from Amazon AMZN Web Services and Microsoft MSFT for these accounts. Neither of those cloud giants are burdened with the sort of internal wrangling that EMC is now working through.

Presumably, once the federation gets all this internal stuff sorted out—Goulden said there will be an update early next year—EMC’s $67 billion merger with Dell will go through and there will be more massive reorganizations to come.

Stay tuned.

For more coverage of EMC-Dell deal, watch this Fortune video:

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