Broadcom halves subscription price for VMware's flagship hybrid cloud suite Broadcom's VMware Cloud Foundation Division has announced what it's described as "a dramatic simplification of our product portfolio," plus the end of perpetual licenses and a move to subscriptions – some at half their previous price. The Cloud Foundation Division is a Broadcom business unit dedicated to VMware's server …
The problem is there are few if any offerings which are as complete and well integrated as the VMware stack.
It will be quite a pita to migrate such an important part of the infra as a hypervisor.
Perhaps a bit less if you haves moved with the times to containerization but it will still be quite a challenge to do.
Broadcom stock was as low as $904 last week and hit $1061 today. Investors(*) seem to be happy with Broadcom's business strategy.
* Investors = People with 401k retirement plans invested in mutual funds, some of which buy growth stocks like AVGO. Or retirees who have switched over to dividend paying stocks like AVGO. You know, regular people like you & me.
You're not the one deciding where your mutual fund investments go, and your analysis of the situation is just in-your-face bollocks. The market is always volatile with speculation, see how it equalizes in 6 months when companies say yes or no to subscription licenses. Until then, your smug and condescending opinion is rubbish.
OK, so the list price is 50% off. What does that mean to everyone really? If you’ve dealt with VMware (or any IT vendor) you know that list is not reality. Big IT shops may get 70% or 90% off list price of some software. So, if it was $1,000,000 list last week and with discounts I was going to have to send a PO for $250k, what is it now? $500k list and only giving out 50% discounts? Same price, eh? Plus the vendor management groups will be peeved that they can’t crow to the CFO about the great discount they negotiated.
TLDR: I doubt it will be much cheaper in the end.
Probably means most people aren't taking the full stack.
Before: "Cloud Foundation costs 3 times more than we're currently paying! We're not even going to look at that, especially since we won't be using most of the features"
After: "Cloud Foundation only costs 50% more than we're currently paying. Maybe we should take a look at it and see if we can use some of those features?"
Once locked into the new license and features, annual rises will get the price back to where it was reasonably quickly.
"Many VMware customers will see that as a pleasant surprise, given Broadcom's past actions to hike prices after acquiring CA and Symantec."
Then they're suckers. The whole point of the price cuts is to push people to adopt the subscription licensing willingly. Give it 2-3 years, when enough have converted to subscriptions, the vice will start closing.
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