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For a long time now, VMware and Amazon Web Services have been antagonists in the age the cloud.

AWS is built on an implementation of the open-source Xen hypervisor that VMware views as a threat to its enterprise empire. What’s more, AWS has been calling for the obsolescence of all forms of on-premise IT since the day it launched a decade ago.

This week, both parties appear willing to put aside those longstanding differences under an alliance that calls for VMware in 2017 to make available VMware Cloud Foundation on AWS. Built on top of the VMware hypervisor running on physical servers managed by AWS, VMware Cloud Foundation consists of VMware vSphere, VMware vSAN and NSX network virtualization software and is available to select customers as a technology preview now.

In addition, both companies have committed to making it possible for organizations that have embraced VMware vCenter management tools to manage VMware environments on AWS using their existing software licenses as well as any tools and scripts that make use of the vCenter APIs.

For solution providers, the most significant aspect of all this is that VMware has agreed to make AWS its primary public cloud infrastructure partner. Likewise, AWS is saying that VMware will now be its primary private cloud partner. That suggests that the existing cloud partnerships between VMware and IBM under which VMware software can be deployed on the IBM public cloud will take a back seat to the AWS alliance.

VMware and its partners will be selling VMware Cloud Foundation, while instances of VMware software running on the IBM cloud are sold by IBM and its partners. It also means that any future effort to move VMware software onto the Microsoft Azure cloud is not as high a priority. Also in question now is the continued relevance of VMware’s own public cloud as well as the Virtustream public cloud operated by sister company Dell EMC.

For AWS, the alliance with VMware essentially amounts to a significant amount of backpedaling when it comes to on-premise IT.

AWS CEO Andrew Jassy acknowledges that AWS has been forcing IT organizations to make “binary decisions” between AWS in the cloud and VMware on-premise that they did not want to have to make. That binary decision spawned an entire cloud cottage industry around making conversions between AWS and VMware.

VMware CEO Pat Gelsinger made it clear that organizations can now have “the best of both worlds.”

Of course, both AWS and VMware are in many ways responding to a Microsoft threat more than actual customer requests. Customers have been complaining about the binary choice between VMware and AWS for years.

What’s changed now is that Microsoft is having some success positioning Azure as a natural hybrid cloud complement to Windows Server and a forthcoming Microsoft Azure Stack offering that will be bundled on servers from a wide variety of vendors starting in 2017. For customers that opt to go with hybrid cloud computing solutions from Microsoft and its partners, there is no so-called binary decision to make.

It’ll be interesting to see how much actual enthusiasm there is for VMware Cloud Foundation in the sales field. VMware is trying to fend off a variety of open-source threats on-premise and in the cloud, and AWS as a whole is still going to very much favor the deployment of services based on open-source software. But it’s clear that the alliance with AWS represents a victory for VMware in that it forced AWS to backtrack on the continued relevance of private clouds running on-premise.

What remains to be seen now is whether that winds up being a victory that generates meaningful revenues for VMware and its partners or at this juncture will wind up being much more Pyrrhic in nature.

Mike Vizard has covered IT for more than 25 years, and has edited or contributed to a number of tech publications, including InfoWorld, CRN and eWEEK. He currently blogs daily for IT Business Edge and contributes to CIOinsight, Channel Insider and Baseline.