VMware To Buy Zimbra From Yahoo

VMware has struck a deal with Yahoo to acquire all of Zimbra's technology and intellectual property. It plans to use Zimbra's open-source email and collaboration software to build out VMware's virtualization infrastructure for cloud computing environments. Financial terms were not disclosed.

Acquiring an email provider is an unexpected move from VMware. However, Steve Herrod, chief technology officer for the company, said Zimbra fits VMware's strategy of adding a ready-to-run application layer at the top of its vCloud software stack.

"With Zimbra, we will now offer our partners an even higher level of cloud capability; one where customers can simply use an application without worrying about the details of how and where it runs," Herrod said Tuesday in the company's blog.

VMware's cloud stack starts with its vSphere compute and storage infrastructure, which is topped by the simplified Java development environment VMware got last August with its $420 million acquisition of SpringSource. The platform provides a runtime environment for developers code, while handling all the calls to VMware's virtualization infrastructure.

Zimbra's software would be packaged with the rest of the stack "to deliver a well integrated portfolio of compute, application development and core IT service clouds," Herrod said. Along with Zimbra's e-mail, calendaring and collaboration software, other core IT services that would be at home in VMware's stack are file and print services and identity management.

"All four of these technology areas are common to companies large and small," Herrod said. "Furthermore, each area is taking growing amounts of IT attention, time, and money without furthering the ultimate goals of the company."

Zimbra offers on-premise software, which is popular among small and medium-sized businesses. It also sells its technology as a hosted service. Customers include Comcast and NTT Communications.

Overall, Zimbra technology powers more than 55 million mailboxes, according to the company. Zimbra's software also runs Yahoo Mail and Yahoo Calendar. Under the deal, Yahoo would have the right to continue to use Zimbra technology in its communication services.

The purchase is expected to close during the current quarter.