back to article Broadcom makes U-turn on plan to serve top 2,000 VMware customers itself

Broadcom has revised its strategy to work directly with the top 2,000 "strategic" VMware users, and will instead focus on just 500 – a move that Canalys chief analyst Alastair Edwards described as "a U-turn." Edwards told The Register the change was quietly announced at VMware's November Explore conference in Barcelona, after …

  1. Anonymous Coward
    Anonymous Coward

    unhappy partners?

    Broadcom may end up getting less help from the partners than they're hoping for. There have been reports of some Broadcom VMware channel partners not being particularly enthused about the licensing terms and price hikes either.

    After all, if customers are bailing and looking elsewhere, that's money out of the partners' pockets too.

    1. Anonymous Coward
      Anonymous Coward

      Re: unhappy partners?

      Current employer has announced no new VMware installs and is working on starting to plan migrations away for clients...

      We can't be the only ones.

      1. Anonymous Coward
        Anonymous Coward

        Re: unhappy partners?

        Purchasing at our place a screaming "find alternative to all Broadcom products where ever possible!!"

    2. Roland6 Silver badge

      Re: unhappy partners?

      I wonder how many “partners”, who currently will have working relationships with VMware customers, are now diversifying into competitive product sets and so help both their existing customers and themselves to protect their investments and revenues…

      1. KrisATX

        Re: unhappy partners?

        A lot... I'm at a major HW vendor & talk to them on a regular basis.

      2. sedregj Bronze badge
        Windows

        Re: unhappy partners?

        "I wonder how many “partners”, ... are now diversifying into competitive product sets"

        Little ex-partner here. I'm run off my feet migrating VMware to Proxmox. The bigger customers will take a while yet but the smaller ones are an easy job.

        Linux Qemu based virty is very decent these days. Its rather nice having the hosts back under your control and not how VMware think they should be - for your own good, obviously.

        I've been a VMware consultant for over 20 odd years.

        Fuck 'em!

      3. Anonymous Coward
        Anonymous Coward

        Re: unhappy partners?

        Seems likely.

    3. Anonymous Coward
      Anonymous Coward

      Re: unhappy partners?

      Help from "partners" ?

      Those would be the resellers that got F***d over by broadcom.

      Perhaps someone should explain to management what the word "partner" means out here in the real world?

      1. arachnoid2

        Re: unhappy partners?

        Akin to Nvidia in their treatment of "partners" then.

  2. EricM Silver badge

    Too little, too late?

    Broadcom has shown what they are willing to do to customers and partners alike to extract more money from them, so one could argue, they worked pretty hard on being moved from "trusted provider" into the "corporate risk" category.

    And most corporations by now will have completed their risk assessments and initiated plans to minimize the risk Broadcom has become.

    1. Anonymous Coward
      Anonymous Coward

      Re: Too little, too late?

      That's the magic word here: risk.

      Broadcom may have changed its tune, but it has signalled it cannot be trusted as a company and has thus classified itself as a risk. There's no certainty it won't try this again at some point so it has prompted migrations to de-risk VM deployment.

      Trust is one of these thing that takes ages to build up and can be destroyed overnight by one stupid move, by failing to acknowledge of being far too late in it that you screwed up, or by doing something that illustrates that you don't care at all about your customers. Unless, of course, you're so big or such a well maintained monopoly or entanglement that customers don't have a choice (Redmond is but one example but is clearest in demonstrating its contempt for its users by the UIs and UX it offers)..

    2. Anonymous Coward
      Anonymous Coward

      Re: Too little, too late?

      "Broadcom has shown what they are willing to do to customers and partners alike to extract more money from them, so one could argue, they worked pretty hard on being moved from "trusted provider" into the "corporate risk" category.

      And most corporations by now wil"have completed their risk assessments and initiated plans to minimize the risk Broadcom has become."

      Upvote for you. Whatever new policy vmware is coming with to please X or Y on an ad-hoc basis, the damage is done.

      What was not a risk before is now a major one. And vmware even went to the point of giving detail data on it: potential costs etc ...

      The key word is not cost, but risk !

  3. AMBxx Silver badge

    Why choose them?

    If you were a greenfield site, you wouldn't choose VMWare. That means shrinking sales and market share.

  4. tater

    How can one plan if Broadcom can not plan themselves?

    1. Anonymous Coward
      Anonymous Coward

      They do plan.

      Just very; very badly..

    2. Anonymous Coward
      Anonymous Coward

      Ah, but Broadcom does have a plan, and we have seen it before. This is the exact same playbook Broadcom ran with Symantec in 2019-2020. Initially 2000 customers, then cut to 500 customers.

      Want to do some investigative reporting? Go find out how many Symantec customers Broadcom services directly today. That will be a pretty good bet for what VMWare's future will look like.

  5. jglathe

    Let them rot.

    Migrate, never look back.

  6. Anonymous Coward
    Anonymous Coward

    "Am I going to stay on VMware?"

    Well that's the problem right there.

    If it's core infrastructure then you should never have to ask yourself if the supplier is "extracting the urine" .

    It should be just be a case of asking for the budget to include what worked last year.

  7. An_Old_Dog Silver badge

    Doubling Down vs U-Turning

    Isn't Broadcom just doubling down (mathematically-speaking, "quadrupling down"), rather than U-turning, on their original plan of dealing directly only with the largest accounts, and neglecting the others?

    Have I forgotten something here?

  8. Zakspade

    Defending Broadcom

    Too many Comments are knocking Broadcom and how they have (mis)managed and (mis)priced their offerings.

    I'm going to put the record straight and defend Broadcom.

    Starting with, er.. Um. Er. Well, you see, er. Ah! No, er.

    I'll get back to you with some reasons that prove Broadcom have judged it well.

    Probably in early 2025. Or 2026. Or, er...

    1. Anonymous Coward
      Anonymous Coward

      Re: Defending Broadcom

      To be fair, any business would've done the same if they thought their customers were massive mugs ripe for the plucking. There are Christmas bonuses to pay for.

  9. Vulture@C64

    I suspect Broadcom has found that the support requirements for major cloud partners is complex and they don't have a value offering that works for them, so have dumped them on the partners in the hope they can discount and have additional offerings which will create more value for the customers.

    The 500 they have kept will be the largest global business which will find it hardest to migrate to a different platform and will be nurtured as best a snake can nurture, probably by offering discounts because that's the language this snake speaks.

  10. StrangerHereMyself Silver badge

    Downpour

    A drop becomes a downpour. Just because customers aren't defecting at this very minute doesn't mean they won't within the next 12 to 18 months. Many need time, money and manpower to make the change. That can't be done overnight.

    Broadcom are fools believing they can ride this out.

    1. NickHolland

      Re: Downpour

      Oh, I'm sure Broadcom will ride it out.

      If they get more in revenue (with time value of money stuff calculated in, of course) than they paid for VMware, it will even be a win.

      There are too many companies out there who are too committed to VMware (first mistake) to make a quick change. Or even a slow change. So VMWare will be a money maker for a number of years to come. As customers scale back, chop VMware R&D staff, then support staff, customer relations staff. A small billing department can take in a lot of money. Couple people to deal with security patches (who am I kidding? Whaddya gonna do, shut down your VMware servers? move to another product? Chop the security people, too! Oh wait, that looks bad. Outsource that to Elbonia, and show your "commitment to security"). It becomes almost pure revenue, minimal cost to produce that revenue.

      Broadcom is going to ride it out just fine. VMware will probably vanish as a "product" in a decade or so, but the money will be made. Return on investment had. Success.

      If this gets companies to realize bedding down with one vendor is a Really Bad Idea, that's all fine with me. If this gets companies to realize their vendors are in business for the same reason they are (to make money), again, all the better.

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