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Broadcom sketches out VMware ambitions that stretch from mainframe to cloud

Engineers, sales teams told to stick around, customers promised more 'choice' – to buy from Symantec or CA

Simon Sharwood, APAC Editor Thu 23 Jun 2022 // 00:32 UTC

Broadcom has made its first public comment in weeks about its plans for VMware, should the surprise $61 billion acquisition proceed as planned, and has prioritized retaining VMware's engineers to preserve the virtualization giant's innovation capabilities.
The outline of Broadcom's plans appeared in a Wednesday blog post by Broadcom Software president Tom Krause.

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VMware customers fear Broadcom acquisition will stall innovation, increase cost

Gartner advises renegotiating subscriptions now to avoid ‘dramatic’ and ‘extraordinary’ price rises

Simon Sharwood, APAC Editor Thu 9 Jun 2022 // 00:57 UTC

Analyst firms S&P Global Market Intelligence and Gartner have both offered negative evaluations of Broadcom's takeover of VMware.
S&P surveyed VMware customers and found 44 percent feel neutral about the deal, and 40 percent expressed negative sentiments.
But when the analyst crunched the numbers for current customers of both VMware and Broadcom, 56 percent expressed negative sentiments. More than a quarter rated their response to the deal as "extremely negative".

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Ditching VMware over the Broadcom buy? Here are some of your options

What's your contingency plan?

Tobias Mann Tue 28 Jun 2022 // 18:01 UTC

Opinion Broadcom has yet to close the deal on taking over VMware, but the industry is already awash with speculation and analysis as to how the event could impact the cloud giant's product availability and pricing.
If Broadcom's track record and stated strategy tell us anything, we could soon see VMware refocus its efforts on its top 600 customers and raise prices, and leave thousands more searching for an alternative.
The jury is still out as to whether Broadcom will repeat the past or take a different approach. But, when it comes to VMware's ESXi hypervisor, customer concern is valid. There aren't many vendor options that can take on VMware in this arena, Forrester analyst Naveen Chhabra, tells The Register.

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Broadcom's stated strategy ignores most VMware customers

Focuses on 600 users, lets smaller outfits slide, trims R&D spend, slashes sales expenses

Simon Sharwood, APAC Editor Mon 30 May 2022 // 13:00 UTC

Broadcom's stated strategy is very simple: focus on 600 customers who will struggle to change suppliers, reap vastly lower sales and marketing costs by focusing on that small pool, and trim R&D by not thinking about the needs of other customers – who can be let go if necessary without much harm to the bottom line.
The Register offers that summary based on Broadcom's own words, as uttered at a November 2021 Investor Day.
The Broadcom event kicked off with an overview from president Tom Krause, who illustrated the outfit's go-to-market plan with the following diagram.

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VMware customers have watched Broadcom's acquisitions and don't like what they see

It's not hard to find unpleasant precedents for what might happen to Virtzilla

Simon Sharwood, APAC Editor Tue 31 May 2022 // 08:05 UTC

VMware customers have seen companies acquired by Broadcom Software emerge with lower profiles, slower innovation, and higher prices - a combination that makes them nervous about the virtualization giant’s future.
The Register offers that assessment after spending the day at a VMware user group conference in Melbourne, Australia, where we interviewed over a dozen VMware customers to ascertain their reaction to Broadcom’s surprise acquisition of the virtualisation giant. The customers all requested that The Register not use their names, or those of their employers, as none were authorized to speak to the media.
One of those customers was a sysadmin at a sporting organisation that has decided to drop Symantec products because product evolution has slowed under Broadcom’s ownership. The sysadmin has also heard, from multiple sources including Broadcom partners, that the company uses price hikes to discourage customers it does not want.

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Broadcom to 'focus on rapid transition to subscriptions' for VMware

Offers comforting vision for core customers, products, channel – though warns efficiencies are coming

Simon Sharwood, APAC Editor Fri 27 May 2022 // 01:58 UTC

Broadcom has signaled its $61 billion acquisition of VMware will involve a “rapid transition from perpetual licenses to subscriptions.”
That's according to Tom Krause, president of the Broadcom Software Group, on Thursday's Broadcom earnings call. He was asked how the semiconductor giant plans to deliver on its guidance that VMware will add approximately $8.5 billion of pro forma EBITDA to Broadcom within three years of the deal closing – significant growth given VMware currently produces about $4.7 billion. And subscriptions was the answer.
Krause also repeatedly said Broadcom intends to invest in VMware’s key product portfolio and is pleased to be acquiring a sales organization and channel relationships that give it reach Broadcom does not currently enjoy.

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Broadcom buying VMware could create an edge infrastructure and IoT empire

Hypervisor giant too big to be kept ticking over like CA or Symantec. Instead it can wrangle net-connected kit

Simon Sharwood, APAC Editor Thu 26 May 2022 // 07:03 UTC

Comment Broadcom’s mooted acquisition of VMware looks odd at face value, but if considered as a means to make edge computing and the Internet of Things (IoT) more mature and manageable, and give organizations the tools to drive them, the deal makes rather more sense.
Edge and IoT are the two coming things in computing and will grow for years, meaning the proposed deal could be very good for VMware’s current customers.
An Ethernet switch that Broadcom launched this week shows why this is a plausible scenario.

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Broadcom to buy VMware 'on Thursday for $60 billion'

Think we speak for everyone when we say: Seriously, what the f...?

Simon Sharwood, APAC Editor Tue 24 May 2022 // 02:18 UTC

Broadcom is to acquire VMware for $60 billion in a deal that will be announced on Thursday.
That's according to the Wall Street Journal. VMware is scheduled to report its Q1 2023 results on the same day, so the Thursday announcement theory is not entirely unrealistic.
Neither biz has had anything to say about the reported deal at the time of writing, with VMware declining comment on rumor and speculation.

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Broadcom in talks to buy VMware: multiple reports

Michael Dell could be the key to any deal

Simon Sharwood, APAC Editor Mon 23 May 2022 // 02:58 UTC

Broadcom is in early talks to buy VMware, according to The New York Times, Bloomberg, and Reuters.
VMware is not commenting on the matter.
This one is interesting, because the three sources we've linked to above all say they've got the news from "a person familiar with the matter." All say the deal is nowhere near done, a price has not been discussed, and a transaction is far from certain to happen.

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VMware reveals vSphere-as-a-service – but not the price

Cloudy vSphere+ can manage multiple on-prem environments but not VMw-powered public clouds … for now

Simon Sharwood, APAC Editor Tue 28 Jun 2022 // 15:30 UTC

VMware today revealed details about Project Arctic, the vSphere-as-a-service offering it teased in late 2021, though it won't discuss pricing for another month.
VMware's thinking starts with the fact that organizations are likely to run multiple instances of its vSphere and VSAN products, often in multiple locations. Managing them all centrally is not easy.
Enter vSphere+ and VSAN+, which run in the cloud and can control multiple on-premises instances of vSphere or VSAN. To make that possible, users will need to adopt the Cloud Gateway, which connects vSphere instances to a Cloud Console.

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