How much talent can VMWare (NYSE:VMW) afford to lose? We're about to find out. On Friday, executives at this Motley Fool Rule Breakers recommendation said that Paul Chan, a senior leader in charge of product development, has resigned.
Chan's leaving follows co-founder Diane Greene's firing by parent company EMC (NYSE:EMC) in July. Co-founder Dr. Mendel Rosenblum, Greene's husband, soon followed.
But the brain drain didn't stop there. Richard Sarwal, executive vice president of R&D, returned to Oracle (NASDAQ:ORCL) earlier this month, less than a year after leaving the database king. Finally, there's Chan.
That's four techies gone in a matter of months. Color me a little worried.
CEO Paul Maritz, himself a recent hire from Microsoft (NASDAQ:MSFT), told reporters at last week's VMWorld trade show that executive turnover is inevitable. Perhaps, but VMWare is losing people who know the code that makes its products special, products now under assault from Mr. Softy's own virtualization technology.
For now, VMWare is still widely viewed as the technical and market leader by those who employ virtualization. But Microsoft's pricing tactics could have an effect long-term, according to customers and analysts interviewed by News.com during VMWorld.
"Microsoft's main pitch is that anyone with Windows could have the hypervisor for free, so the net cost of the software is zero," data center operator Michael Tran told News.com. "Anything else is going to look expensive against it."
Agreed. The good news? That's not likely to be an issue so long as VMWare has the brainpower to be orders of magnitude better at virtualization than everyone else.
It's time to plug that drain, Mr. Maritz.
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