AT&T claims VMware by Broadcom offered it a 1,050 percent price rise AT&T has claimed that Broadcom made it an offer to increase prices by 1,050 percent, and may be influencing other vendors to make a migration harder. The claim of the colossal price hike came in an email [PDF] filed in evidence by AT&T in its case alleging Broadcom hasn't honored a contract that would allow the carrier to …
My experience is that the moment you get into virtualised software where it requires near realtime capabilities with low jitter - i.e voice products - the vendors will only provide support to a very specific virtualisation config. Almost always Vmware, but they will also specify the node config, supported processors, vmware versions etc.
Every single one of those vendors needs to build an alternate support matrix first.
VoIP - lol, try doing video analysis. I wrote a wiki page for Zoneminder on doing GPU pass through. It's tools for the job mate.
A three+ node modern Proxmox hyperconverged cluster will run rather a lot of concurrent voice calls. You can run in containers instead of VMs to get very close to the CPUs and RAM. You get Open vSwitch and all the toys in the box, which VMware classify as "get your wallet out".
On VMware you will want to set the low latency option for your VMs which means they can't vMotion or be paused and other limitations. If you want containers, you need Tanzu and that needs Enterprise Plus licensing, which is eyewateringly expensive. You also need a vCentre and other stuff which consumes resources, takes ages to start up, needs ages to patch and is basically a pain to care for.
I've been a VMware afficionado for over 25 years and we are migrating our VMware customers to Proxmox as fast as is practicable.
Mind you, nowadays people are so conditioned with Teams and co's rubbish latency that they will put up with over 1 sec of latency without blinking. Back in the day that was satellite relay times for a call from the UK to AU
I have no sympathy because the Broadcom contract is ending anyway. Broadcom is fighting AT&T to essentially stay on with whatever Broadcom decides the stipulations to be.
AT&T migration policy is a moot point, it's not Broadcom's business to decide how customers may move away from their products. The litigation is whether or not AT&T is *moving fast enough*, and Broadcom states that
"The affidavit therefore alleges that AT&T only wants continued support from Broadcom to give it enough time to perform its migration – meaning Broadcom would be harmed by having to keep supporting products from which it's moved on, rather than being able to work on its own business plan."
because AT&T doesn't have the right to have its OWN business plan??
The "harm" is already there, Broadcom - you priced yourself right out of a customer. So now you're trying to bully a customer into playing your game of "We decide what we want and you have no choice" through the court system. There is no legal right, beyond the stipulations of a contract, for a customer to keep playing your game. Oh! Your contract is already expired?? Too bad for you. And your contract stated, in writing, that they could extend on *AT&T's* decision and that you would honor that.
Which you are trying to renege on. And now, according to the AT&T filing, you are even trying to slow or prevent the migration by pressuring AT&T's business partners.
Broadcom, oh Broadcom. You think your King of the Hill, passing down judgements. You've met your match with AT&T, they have the power and the money to biatchslap you like you need to.
Bloody tired of the open source mob on this. Vmware is a durable stable platform that regulators should NOT have allowed broadcom to buy.
None of the open source alternatives will scale up to the size that a firm like AT & T need & as an ex health service engineer, I would not run infrastructure that important on software that's dependent on Dave in the basement keeping up to date.
On the plus side, it IS good to see these large corporations being treated in the same way that they normally treat consumers
When Broadcom announced their new VMware "shakedown" pricing regime the entire I.T. world seemingly responded with a collective "Are you really trying to destroy your customer-base the way it LOOKS like you're trying to destroy your customer-base and push them all off your shiny new acquisition??"
Just the latest saga in the software-industry's orgy of trying to armtwist customers into perpetual rental of dilapidated bungalows for the price of a castle.
AT&T may be the first major international corporation hitting the news for their disgust at the tactic, but it's only the tip of the iceberg.
After these sorts of revolts become commonplace, I think the entire S/W industry is going to be in for a big shock as their customer base increasingly abandons their products/services.
It's true that ATT is one of the worst corporate abominations itself.
But in this case it's not like the entire industry hasn't had basically the same reaction to Broadcom's shameless attempt to extort money from the customers of a new acquisition that spent decades building that business only for Broadcom to drive them away en-masse.
I recall in the earlier days of Openstack, AT&T was a big name in that space. I was surprised to see these articles around VMware and AT&T, though it made sense that AT&T used some VMware, had no idea they had so many systems on it.
See this from 2016 and 2018
https://about.att.com/innovationblog/openstack_cloud
https://about.att.com/innovationblog/airship_for_openstac
Seems Openstack was deployed at AT&T as far back as 2011
https://www.openstack.org/blog/openstack-deployments-abound-at-austin-meetup-129/
The last AT&T VMware article I poked around more and was quite surprised to see AT&T seems to have withdrawn from Openstack, maybe VMware gave them a deal too good to pass up, perhaps that is why their new bill is 1000% more expensive..
You can see here, in 2020 & 2021 AT&T was a Platinum sponsor of Openstack:
https://web.archive.org/web/20201027213028/https://www.openstack.org/community/supporting-organizations/
https://web.archive.org/web/20211019122932/https://www.openstack.org/community/supporting-organizations/
but as of 2022 they dropped off the list, I could not find any other search engine hits as to why AT&T was not on the list anymore:
https://web.archive.org/web/20220515130825/https://www.openstack.org/community/supporting-organizations/
(disclaimer I have never used openstack, I had high hopes for it when it first came out(mainly during the VMware vRAM fiasco), but by ~2014ish time frame I came to the conclusion it was too complex to be useful for anyone but orgs with large amounts of resources to support it, and could not replace simple VMware deployments, and it seems that hasn't changed, but AT&T has such resources and could do it if they wanted to).
There was a big push in the wireless world at timeframe for a concept called NFV (Network Function Virtualization) where in all the discrete hardware based network functions were to be virtualized and auto-scaled. Openstack was one of the contenders to be the standard orchestrator in that eco-system. Don't know where things have gone since then as I left that space 8 years ago.
There are off the shelf implementations of OpenStack. Proxmox, for example. Some of the Telco vendors (Ericsson and Huawei to name two) are able to provide carriers with their own OpenStack based private cloud. What ATT are doing with VMWare must run somewhat deeper than with other VMWare customers who’ve successfully migrated away.
What you are seeing is what happens when a huge corporation like ATT is changing technologies. Every middle manager has a stake and you can be sure the VMware and Open Stack groups don't entirely overlap. It's Steph's that way until someone in internal politics gets the upper hand and crushes the other one, regardless of actual merit or savings.
If the company has stopped supporting the product but one customer still wants to continue, it seems fair to pass on the full cost to that one customer for the continued support, plus a fair and reasonable profit margin. I guess the question for the courts is whether the price quoted is that fair cost, or a punative fee to get the customer to move to a currently supported product or exploit the customer's position to extract maximum profit from the situation.
Giving AT&T the option to purchase that support at a relatively low cost.
At least, that's what AT&T have claimed.
The only defence to that is to provide evidence to the contrary, eg that the contract didn't exist, or that it actually said something different.
So far, Broadcom have not attempted to do either of those things. It is most strange, almost like they know they have no defense whatsoever and instead are tossing spaghetti at the wall hoping the judge will drown in tomato sauce.
TLDR : there's lots of money involved, so they both get to play silly lawyers games to see who manages to kick who the most in the next few years.
The whole basis is 'it actually said something different'
The option to purchase at a relatively low cost is what AT&T *want*, it is not necessarily what the contract says otherwise it would be open and shut as you say. It may be what you'd reasonably expect, but note in the redacted e-mail there is absolutely no reference to e.g. inflation or a capped annual increase aka business-ese for 'we know you've got our pants down, so we're going to use another strategy to minimise our costs'. If the initial filing is read there is a redacted support charge, but that's only a charge at that point, it doesn't necessarily affect subsequent years and the wording as to the three year/up to three one year terms is not entirely clear.
My reading is also that AT&T are using old and expensive to support VMWare products, despite trying to divert attention away by saying it's not in customer facing critical systems. They contradict themselves in how quickly they are able to move off VMWare.
Broadcom do seem to be intending to charge an awful lot, and who knows if it's unwarranted, but I bet AT&T are rather expensive to support and make money on. Basically they deserve each other. Popcorn?
They understand it perfectly well and would do the same again; they're just playing the pricing game.
The company providing the product or service bets the revenue accrued over the license period is greater than the cost to provide this to them
The customer bets the value they extract is greater than the amount they pay
Provided both of these are true, everyone is happy. Creating the product yourself would be more expensive or take longer than using a third party. Companies aren't completely stupid, they would have considered that.
Having said that I personally think too many people are incredibly poor at drafting contracts and selling product. There can be insufficient oversight of sales or design leading to everyone else being lumbered with the consequences for years. Not to mention handling product evolution : if your new shiny product is notably more expensive than the old one, amazingly customers will not move to it unless the price is reduced or very occasionally if there are features that would pay for themselves quickly (and let's face it, how often does that occur?). Sometimes customers have an absolute ceiling on what they will bear, and discontinuing the product will simply mean they move elsewhere.
Having worked for AT&T, VMware probably gave them a good deal and they took it, and it was very likely years ago before Broadcom started sniffing around.
They know plenty about vendor lock-in because they do it themselves, this sounds like what was a good decision at one point that made the beancounters happy quickly turning into a bad one when Broadcom took over, which they were likely expecting because of what happened with CA.
First, AT&T is one of the most horribly abusive oligopoly telecoms in the world, so this is a mere fraction of the karma they're due. There's a reason their logo resembles the Death Star.
Second, as soon as Broadcom started sniffing around VMware we knew where this was possibly heading. It's not like Broadcom doesn't have a long and (in)glorious reputation here going back well over a decade. Any CIOs and IT directors that weren't at least checking the condition of the lifeboats on this soon-to-be-sinking ship are getting what they deserve.
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