VMware announced early this morning that it had acquired Thinstall, a desktop virtualization product vendor based in San Francisco. This news closely follows other VMware acquisition news, namely the purchase of assets from Foedus, a provider of virtualization support and product services.

In a statement released by VMware about the acquisition, Jeff Jenkins, vice president of desktop products and solutions at VMware, described the benefits that Thinstall brings to the VMware product mix.

"Thinstall's third generation solution offers the best technological approach in the market for application virtualization, providing faster, easier and more secure delivery of software applications to desktop-based workforces,” said Jenkins. “The addition of Thinstall to our desktop virtualization portfolio will help us to better deliver cost-effective and more flexible tools for quickly and securely provisioning desktops.”

In addition to building out their product portfolio, VMware’s acquisition strategy is helping the company position itself for an upcoming (and long-term) battle with Microsoft over the virtualization market. Microsoft’s upcoming Hyper-V server virtualization technology is slated to launch shortly after the release of Windows Server 2008, and VMware appears keen to broaden their product mix beyond server virtualization before Hyper-V hits the market.

The Thinstall acquisition also helps VMware against Citrix, which acquired open-source virtualization provider XenSource last fall. The delivery of applications throughout the enterprise has been a lucrative market for Citrix over the years, and Thinstall helps VMware differentiate their product mix by entering a new market.

“The Thinstall acquisition gives VMware entry into the application virtualization market, a segment that they haven’t had access to,” says Michael Rose, an associate research analyst at IDC. “The advantage of acquiring Thinstall is that it allows VMware to be more easily integrated into existing application management systems…it also provides a competitive solution to Citrix and Microsoft’s Softricity.”

Rose also sees the Foedus acquisition as a complimentary one to Thinstall. Foedus specializes in virtualization consulting and services, and the move could facilitate VMware’s efforts to educate the channel about best practices for using desktop virtualization.

“The Foedus acquisition is related to VMware’s pioneering attempt to get ahead in the desktop virtualization space,” says Rose. “All of the big virtualization players sell through channel partners, and this is VMware’s attempt to get a leg up in this space. Foedus will help VMware with the channel, and will also help explain what the best practices are for desktop virtualization.”

Natalie Lambert, a senior analyst with Forrester Research, suggests that the VMware acquisition of Thinstall (as well as Foedus) helps VMware make strides towards becoming a one-stop virtualization vendor.

“VMware wants to have the most comprehensive virtualization solution for their customers,” says Lambert. “By acquiring Thinstall, VMware is working to minimize the number of use cases where customers may consider choosing another virtualization vendor.”

VMware to Acquire Thinstall (VMware statement on acquisition)