If you haven’t heard the rumors, there are rumblings that VMware is launching a public cloud IaaS service. The formal announcement may come at next week’s VMWorld conference where theCube will be broadcasting. Long known for its virtualization products, the foray into the public cloud market is anticipated to make waves throughout the industry. Reports are that for months, VMware has been running a beta of its proposed service, based at a recently purchased data center in Nevada. If true, the plan marks a departure from its service provider partnerships strategy. Pricing for this service will likely be aggressive in order to gain the most market possible from major players such as Amazon, Rackspace and Microsoft.

Quotes from the breaking CRN series, tell the tale of discontent and the friction is evident:

“We’re really not happy about this,” one vCloud service provider partner told CRN Friday. “Not only will we be competing with VMware directly, we could also find ourselves competing with smaller partners that have made little or no investment in cloud infrastructure.”

…VMware service providers are also irritated by the lack of communication they’re getting from the vendor. Of the half-dozen that CRN spoke with this week, none had any advance warning of Project Zephyr…

“We’re in a state of shock,” said one executive at a VMware service provider partner

VMware has for some time now steered partners to bring their customers to partner service providers for cloud services. The development of the Project Zephyr service indicates that partners have not made this move quickly enough in VMware’s view and is therefore assuming the role of service provider themselves. Simply put, VMware is going to show how they want this done. Expectations are that VMware will likely be implementing their best in class data center technologies in the services such as vCenter Operations management Suits, Site Recovery Manager, vCloud Director and EMC high-end storage technology as well. All of these technologies in sum show the best of what VMware has to offer in terms of management, reliability, failover and disaster recovery capabilities.

VMware has also launched a new vCloud Service Evaluation service. Interestingly enough, it allows prospective customers to “test drive” the vCloud products in a public beta environment. Registration for the service evaluation is open now and the invites will be sent out August 27 – The opening day of VMworld. While the directive for this public beta is clear, the existence of the environment and timing brings to mind a number of questions. Could this be a precursor or in fact even the actual environment that Project Zephyr is being run on? We may well find out when VMworld kicks off next week.   More may come forward when theCube starts their coverage as the spotlight falls on new VMware CEO Pat Gelsinger.  Gelsinger is a veteran guest on theCube – below is a video of Gelsinger’s talk with Dave Vellante and John Furrier at EMCworld 2012.