The fight for the cloud is underway. Wikibon analyst Stu Miniman discussed the rivalry between VMware and Amazon and what it means for enterprise IT this morning on the SiliconAngle NewsDesk show (full video below).

Virtualization has taken over the data center. Miniman says that between 50 and 60 percent of all workloads are virtualized, and the overwhelming majority of virtual machines are powered by VMware’s hypervisor. The company wants to keep it this way, but Amazon is disrupting the status quo.

The public cloud provider is offering organizations an alternative way to go about scaling the infrastructure: instead of buying hardware and spending a fortune on virtualization software, users can simply spin up a cluster and only for pay the resources that are consumed. To make things even worse for VMware, Amazon’s partner ecosystem grew substantially in the past 6 to 9 months.

Miniman points out that Amazon has a definite advantage in some areas: for one, it can afford to operate on margins that are considerably lower than what VMware and other traditional data center vendors need to maintain just to stay afloat. There’s also the fact the firm doesn’t have to worry about software-led infrastructure – AWS users have been managing their deployments via online dashboards from the very start.

The public cloud is a big threat to VMware, but Miniman stresses that factors such as unpredictable costs and less than adequate SLAs deter many enterprises from jumping on the IaaS bandwagon. He adds that while Amazon is struggling to cope with these barriers, the virtualization giant is only gaining more share in emerging markets.

VCE, a converged infrastructure vendor backed up by EMC, VMware and Cisco, made over $250 million last quarter. The appliance maker had another milestone last week when it introduced Vision Intelligent Operations, an abstraction framework that makes Vblocks viable in hyperscale environments.

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