Former rivals Amazon Web Services Inc. and VMware Inc. are collaborating on a new data center product targeting hybrid cloud users, according to a report in The Information.

If true, the move would mark a major strategy shift for AWS, which for years has been intensely focused on getting customers to move their workloads away from their own data centers and into its public cloud. It’s not clear exactly what the new product is, but it would apparently run inside customer’s own data centers and probably serve as some kind of bridge to the AWS cloud, the report said.

Any change of strategy would be an acknowledgment from AWS that, apart from a few exceptions, the majority of the world’s largest enterprises aren’t interested in moving all of their workloads to the cloud just yet. They have good reasons for wanting to keep some jobs on-premises. For example, big data workloads are often too difficult and time-consuming to move to the cloud, while some companies must adhere to regulations that stipulate that some data must be kept in corporate data centers.

As such, these companies tend to view the public cloud as an alternative option for certain kinds of workloads that can easily be migrated and aren’t heavily regulated. This combination of on-premises and public cloud is usually referred to as a “hybrid cloud” strategy, and this is what AWS seems to turning its attention to through its partnership with VMware.

“It is a strategic imperative for AWS to address the hybrid cloud,” said David Floyer, chief technology officer at the analyst group Wikibon, owned by the same company as SiliconANGLE. “AWS must ensure the same services and architecture are available in the cloud and on premises, with true end-to-end support from a single vendor. They have to match Microsoft Azure functionality, or they will be crushed by the Microsoft software-as-a-service + infrastructure-as-a-service combination.”

Floyer said it’s important to distinguish among the various announced and unannounced deals between the two companies. “There is a big difference between the initial product (AWS hosting VMware, under the management of VMware), future updates to the AWS/VMware offering in the AWS cloud, and future on-premises AWS/VMware software with AWS extensions,” he said. “I believe the first is on track for this year, and the second will probably going to come later, and the last has not been announced or even acknowledged, and will be significantly later.”

Amazon’s main public cloud rival, Microsoft Corp., has already acknowledged that information technology is going hybrid with the recent launch of its Azure Stack offering, which combines Azure cloud software with hardware from partners like Dell EMC and Hewlett Packard Enterprise Co., among others. Azure Stack is an on-premises solution that provides many of the Azure Cloud features and is designed to facilitate customer’s hybrid cloud strategies. Indeed, Vellante said, AWS is less competitive to VMware than Microsoft, making Amazon the logical partner for VMware.

As for AWS and VMware, the two companies made headlines in October when they announced a partnership that aimed to help enterprises integrate their VMware environments with the AWS cloud. Under that partnership, announced by AWS CEO Andy Jassy (pictured, left) and VMware CEO Pat Gelsinger (right), VMware will sell tools that allow its customers to manage AWS the same way they manage VMware’s on-premises environments. That service was announced as a preview originally scheduled for release in mid-2017, but The Information’s report said it now might be delayed until 2018.

The new product could make it easier for companies to migrate applications between their data centers and Amazon’s server farms and make it easier to recover data from Amazon in case of disasters, The Information said, citing an unnamed source.

“It’s a sign of how much AWS wants the on-premises load,” said Holger Mueller, principal analyst and vice president at Constellation Research Inc., though he admitted he hadn’t heard anything directly from either company about the latest reports. “The original announcement was that VMware would manage the AWS VMware instances. Now they are probably going to allow self-service as well. If so, it’s a good move for CIOs as they have more choice where to deploy VMware images.”

VMware is a valuable ally for AWS because of its massive enterprise data center installed base. Meanwhile, VMware’s big focus right now is on helping customers to create IT environments that combine on-premises with public cloud infrastructures.

VMware’s stock rose 3 percent today, while Amazon’s stock was up a little under 1 percent following The Information’s report. Both companies declined to comment on the story.

Image: Robert Hof