Microsoft and Citrix are to reduce their visibility at next week's VMworld show and are to cease to sponsor the event after a row with VMware. In addition, Microsoft is not to show its latest management software tool, System Center Virtual Machine Manager 2008 R2, claiming that VMware was restricting what could or couldn't be demonstrated.

The problem for VMware competitors is that VMworld is the de facto virtualisation event - however it is also very much VMware's event. That is going to lead to conflict.

Although Microsoft and Citrix have both served as "gold sponsors" at past VMworld conferences, including the September 2008 show in Las Vegas and the February 2009 show in France., this time round, Microsoft and Citrix are claiming that VMware is unfairly limiting competition at the show, a charge VMware denies.

Therefore for next week's conference, Microsoft and Citrix are no longer sponsors and are listed merely as exhibitors. In addition to Microsoft ceasing to demo its System Center Virtual Machine Manager 2008 R2, Citrix has claimed that VMware was forcing it to reschedule a Citrix Technology Professionals summit meeting so it didn't overlap with VMworld.

VMware denied that its sponsor and exhibitor policies were anything out of the ordinary for an industry conference, and has said it does not aim to limit the rights of competing vendors to exhibit technology at VMworld.

"VMworld is a proprietary event run by one vendor," said  Citrix vice president of marketing Kim Woodward. "At the end of the day, they have every right to change the rules in any way they wish. Citrix respects that and will fully comply with the terms of our show contract with them. When it comes down to it, if customers want a more open event, they will have to give that feedback directly to VMware or vote with their feet by attending other shows that don't restrict competitors."

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It's no surprise that Microsoft and Citrix are taking the same stance, given that the companies have a tight virtualisation partnership as they attempt to unseat VMware in the x86 virtualization market. Competition has been heating up in the past year, and the strategy of Microsoft and Citrix has been to tie their management products together so that customers can use one management platform for both hypervisors.

The issue over VMworld restrictions first arose in May, when it was reported that VMware modified its sponsor and exhibitor agreement to say that products exhibited at VMworld must be "complementary to VMware products and technologies." At the time, VMware said that despite the new language "competing vendors [will be] allowed to exhibit, including exhibiting competing products."

VMware reiterated its position this week. It issued a statement which said: "The exhibitor sponsorship contract we are using is standard across the industry; there is nothing out of the ordinary or meant to limit the value of VMworld. We are expecting a great turnout. Nearly 200 companies, including those with competitive solutions, will be participating in the conference this year."

But Microsoft and Citrix have issued several criticisms of VMware's new policies. Even though Microsoft will have a booth at VMworld, the company says it will not showcase its latest virtualisation technology. "Next week at VMworld 2009 we can't show SCVMM [System Center Virtual Machine Manager] 2008 R2, or any other products, in our booth," Microsoft's Patrick O'Rourke wrote in a blog post Tuesday. "In short, it's their show, it's not an industry show, and they set the rules."

Even last year, when Microsoft was still a VMworld sponsor, the company conducted some guerrilla marketing, passing out fake casino chips directing attendees to a website titled "VMware Costs Way Too Much."

This week, Citrix technologist Rich Crusco wrote in his blog that Citrix had to cancel a virtualization event of its own because of a policy that VMworld exhibitors cannot promote any competing event within 50 miles of VMworld in the days leading up to and after the conference.

Citrix CTO Simon Crosby also wrote that Citrix was unable to organize a meeting at a hotel near the Moscone Center, where VMworld is being held, because VMware allegedly banned the hotel from renting facilities to VMware competitors.

"The ridiculous thing about this is that I thought that VMware was trying to convince us that VMworld is an industry show for virtualization," Crosby wrote. "It clearly isn't.