VMWare Ousts CEO, Hires Paul Maritz

In a move surprising for both its speed and timing, VMWare on Tuesday ousted long-time president and CEO Diane Greene and replaced her with former Microsoft executive Paul Maritz. The moves come just a week after Microsoft shipped its Hyper-V solution, which competes directly with VMWare's bread-and-butter virtualization products. But it also comes amidst a time of steady growth for VMWare.

Officially, Greene was replaced because VMWare was looking for someone "with more operational experience to lead the company into its next growth stage." She was offered another position at the company, a position she declined.

There are hints that the company wanted someone more aggressive in its looming battle for the virtualization market with Microsoft. Picking an infamously aggressive ex-Microsoft executive was most certainly a good decision: Maritz is well known for his combative persona and he was the one Microsoft executive to go on the offensive during his time on the stand during the company's epic US antitrust battle.

VMWare's stock plunged in the wake of Greene's departure, and the company now says it expects modestly lower growth this year than the 50 percent year-over-year gains it previously reported. But growth the 40 percent range is still stellar given the state of the economy and slow growth currently being experienced by many high tech companies.

Microsoft insiders have told me off the record that they're far more leery of Maritz than they ever were of Greene. In a one-on-one meeting a few years ago, I remarked to Greene that I was surprised the company wasn't more aggressive in its approach to Microsoft, a company that was sure to garner huge amounts of market share simply by shipping Hyper-V. She was convinced that VMWare's track record and huge customer base would more than make up for Microsoft's entry into the market. That remains to be seen. But whatever happens now, it will happen without the woman many regarded as the de facto face of virtualization.