The acquisition of VMware by Broadcom has caused significant concern among IT decision makers, with almost all expressing extreme worry about the impact on their organizations. Since the deal closed in November, Broadcom has made abrupt changes to VMware‘s strategy, pricing, and licensing, leading to potential cost increases for customers. The company’s move to bundle products, shift from perpetual licenses to subscriptions, and reduce support for existing licenses has raised red flags among customers and analysts alike.
Despite the discontent, many enterprises have a strong dependency on VMware‘s solutions, with a majority estimated to have some form of VMware deployment in their environments. The lack of viable alternatives with comparable functionality has kept customers tied to VMware despite the changes imposed by Broadcom. This situation has raised concerns about the potential monopoly-like grip that VMware holds over certain industries, making it difficult for customers to easily switch providers.
Broadcom’s history of acquiring technology companies and implementing similar strategies, such as reducing product lines, bundling offerings, and increasing prices, should have served as a warning to VMware customers. However, in a blog post, Broadcom’s President and CEO Hock Tan emphasized the company’s goal of innovation and better customer service through these changes, despite acknowledging the discomfort it has caused to customers and partners.
While some customers are considering alternatives or partial switches away from VMware, the prospect of completely removing VMware from their environments is daunting for many, as it would require significant time and resources. In the short term, Broadcom may not face significant customer churn, as many respondents in the survey are planning to keep at least some of their VMware solutions in place.
Overall, the impact of Broadcom’s acquisition of VMware has been met with widespread concern and dissatisfaction among customers. The disruption to pricing, licensing, and support, combined with Broadcom’s history of implementing similar changes in past acquisitions, has created a challenging environment for IT decision makers. The long-term implications of these changes remain to be seen as customers navigate their options in the face of increased costs and reduced flexibility.
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https://www.ciodive.com/news/broadcom-VMware-lock-in-cost-disruption/718281/