After acquiring VMware, Broadcom announced plans to target larger enterprises with price increases and service packages, but this strategy may have backfired. Computershare, a company heavily involved in VMware‘s virtualization technology, is now abandoning VMware‘s hypervisor in favor of Nutanix products due to unacceptable price increases. Computershare’s IT department had been using both Nutanix AHV and VMware hypervisors, but a significant price increase from VMware led them to consolidate on Nutanix.
Computershare is currently migrating 24,000 virtual machines from VMware to Nutanix AHV and expects the project to pay for itself within a few months. The company anticipates emerging from this migration with lower costs and increased efficiency. While Computershare CTO Kevin O’Connor did not mention Broadcom in his keynote, the company’s plans to raise prices and move VMware to a subscription-only model have caused uncertainty in the market.
The acquisition of VMware by Broadcom has already resulted in layoffs and speculation about the company’s future. There are rumors of large companies and government customers, such as the Department of Defense, considering moving their virtualization and cloud needs away from VMware due to cost increases and uncertainty. While VMware‘s desktop hypervisors are now free, Broadcom’s focus on larger enterprises may have misjudged customer willingness to accept price increases for additional services.
Computershare’s decision to move away from VMware in favor of Nutanix may signal a broader trend that could lead to problems for VMware in the future. The company’s reliance on large enterprises and pricing strategy may not align with customer expectations, potentially leading to further migration away from VMware. It remains to be seen how Broadcom’s acquisition will impact VMware‘s position in the virtualization market in the coming months.
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