WSJ: Broadcom's VMware Overhaul 'Draws Attention of CIOs' (msn.com) 74
The Wall Street Journal reports:
Moves by Broadcom to shore up its $69 billion VMware acquisition, completed in November, include a streamlining of product bundles and new billing models — efforts in line with the chip giant's past acquisitions, but not necessarily welcomed by all of VMware's customers... Broadcom has also recently laid off at least hundreds of VMware workers, disclosures from the Worker Adjustment and Retraining Notification show....
VMware has approximately 330,000 customers, according to the company. Chief information officers say they are closely monitoring what comes next.
"Any CIO that's not taking stock of what they have and mentally considering alternatives and monitoring what else is out there is probably not doing their job," said Jay Ferro, executive vice president and chief information, technology and product officer at clinical research data-management company Clario. All these changes, plus past remarks by Broadcom that its go-to-market strategy is to focus completely on the needs and priorities of its top 600 customers, has left some CIOs rethinking the relationship. Price increases and degrading levels of support are among their biggest concerns. "I'm not one of their top, probably 600 customers, so they've been very clear to me where I fit in that pecking order," said Todd Florence, CIO of trucking company Estes Express Lines. Florence said he's started looking into alternatives. "It certainly doesn't make you feel good, like you're going to get lots of support going forward...."
Goya Foods CIO Suvajit Basu said he is thinking about how to reduce the food company's reliance on VMware as the sole and longtime dominant provider of virtualization for the data center. "They're going to increase their prices or change their licensing so the customer pays more," he said. "And I think this is starting to hit us right now...." Forrester estimates that in 2024, 20% of VMware customers will begin the process of exiting VMware in favor of alternatives.
On the other hand, a group VP at market researcher IDC tells the Journal that on the upside, now VMware and Broadcom will have to engage more actively with customers on the value of new produces included in their bundles...
VMware has approximately 330,000 customers, according to the company. Chief information officers say they are closely monitoring what comes next.
"Any CIO that's not taking stock of what they have and mentally considering alternatives and monitoring what else is out there is probably not doing their job," said Jay Ferro, executive vice president and chief information, technology and product officer at clinical research data-management company Clario. All these changes, plus past remarks by Broadcom that its go-to-market strategy is to focus completely on the needs and priorities of its top 600 customers, has left some CIOs rethinking the relationship. Price increases and degrading levels of support are among their biggest concerns. "I'm not one of their top, probably 600 customers, so they've been very clear to me where I fit in that pecking order," said Todd Florence, CIO of trucking company Estes Express Lines. Florence said he's started looking into alternatives. "It certainly doesn't make you feel good, like you're going to get lots of support going forward...."
Goya Foods CIO Suvajit Basu said he is thinking about how to reduce the food company's reliance on VMware as the sole and longtime dominant provider of virtualization for the data center. "They're going to increase their prices or change their licensing so the customer pays more," he said. "And I think this is starting to hit us right now...." Forrester estimates that in 2024, 20% of VMware customers will begin the process of exiting VMware in favor of alternatives.
On the other hand, a group VP at market researcher IDC tells the Journal that on the upside, now VMware and Broadcom will have to engage more actively with customers on the value of new produces included in their bundles...
Broadcom May Have Crossed The Rubicon (Score:5, Insightful)
Broadcom's changes to VMware licensing, such as ending the perpetual license program, could be crossing the Rubicon with CIOs due to the added costs of the new licensing schemes.
VMware is such a widely used IT toolbox that replacing it with other solutions would be horribly expensive for companies and potentially disruptive to their business operations.
This time I think Broadcom has gone too far with their changes to one of their acquisitions.
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This time I think Broadcom has gone too far with their changes to one of their acquisitions.
Maybe. But if you double your prices and lose a third of your customers, you are still way ahead.
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This time I think Broadcom has gone too far with their changes to one of their acquisitions.
Maybe. But if you double your prices and lose a third of your customers, you are still way ahead.
Maybe so, but as Julius Caesar is reportedly to have actually said, "alea iacta est" ("the die is cast"). Broadcom has shown it's cards in this poker game.
CIOs are now seriously reconsidering their risk exposure in their IT investment into VMware software since Broadcom has a documented history of running their acquistions into obscurity through price jacking of licenses.
I hope we see CIOs invest in FOSS projects & their developers that provide similar services to VMware but expressed in FOSS projects.
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He is far more likely to have said "anerriphtho kybos". It is the Greek version of the same phrase, from a Greek play that was popular among the upper class Romans in that time.
Also, VMware was vile long before Broadcom bought them out.
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Rubicon in the rear view mirror (Score:2)
I agree. They failed to fix serious bugs and functionality shortcomings in their virtualization software for years running — issues that had a direct impact on the virtualized systems I was trying to use for development. That was enough to drive me away. Fortunately there were viable alternatives out there. That, you know, worked correctly.
Re:Broadcom May Have Crossed The Rubicon (Score:5, Informative)
>"I hope we see CIOs invest in FOSS projects & their developers that provide similar services to VMware but expressed in FOSS projects."
^^ This
Of course there are perfectly reasonable uses for commercial/proprietary software. Probably most true in virtualization when you are talking the REALLY big virtualization data-center. But basing your operations completely on proprietary solutions are just asking for being extorted later. In this realm, fortunately, there are FOSS options. And option that are not only very robust, but most also have commercial support options as well.
Knowing your pricing is going to increase a lot, many companies would do well to swallow some pain now and shift to FOSS platforms, then later save tons of money on licensing and with much lower-priced support options. And with more money flowing into such projects from larger companies, they are only going to get better and cover more use-cases. It is an *actual* investment that is likely to reap rewards.
https://xcp-ng.org/ [xcp-ng.org]
https://xen-orchestra.com/ [xen-orchestra.com]
https://www.proxmox.com/en [proxmox.com]
https://linux-kvm.org/page/Mai... [linux-kvm.org]
https://www.ovirt.org/ [ovirt.org]
https://www.virtualbox.org/ [virtualbox.org]
https://www.qemu.org/ [qemu.org]
Re:Broadcom May Have Crossed The Rubicon (Score:4, Interesting)
VMware:
- Computer Virtualization
- Storage Virtualization
- Network Virtualization
Linux variants were always behind VMware in features and capabilities. As Linux caught up VMware would virtualize a new stack. Network virtualization was the last stack. There's no where else to go to add value and justify the expense in the future. So they sold. Linux hasn't caught up but it's only a matter of time. The exit strategy was to sell to Broadcom and let them squeeze the purchase value out. Everything after that is gravy.
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Openstack implementations from Ubuntu and RedHat are most closely aligned directly with features. They also offer commerical support models which is critical for enterprise businesses. Proxmox is pretty pale in comparison feature and usability wise but I'm seeing lots and lots of people flock to it in home labs which means it stands good chance of growing.
Hyperconverged models from Nutanix as an example have also seen prices surging to the point of absurdity. The major commercial entities all seem to be pu
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Yep
XCP-NG + Xen Orchestra is *hot* for business. Really hot. Just packed with features and the ability to run huge clusters. About the only thing missing in it would be hyperconverged storage. They are working on it becoming more viable/stable, but hide it behind commercial-only. Which is a shame because it is actually SMALLER sites that would best make use of that (big sites likely already use HA SAN's and have no need for it).
And Proxmox is hot for home/lab/test.
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there are a lot of options out there, not too many good ones though.
Nutanix is a familiar one, but there are some new ones up and coming.
But the FTC should really look at this and think about why they allowed it.
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In years to come, this will be studied by pimply-faced university students in a best selling book. "How to lose customers and piss off partners".
Killed goodwill overnight. Killed the interest of IT pros who do stuff "on the side". Killed test labs on 2nd or 3rd hand gear. They have no community. This will lead to no growth in sales. They will only retain locked in customers - which only lasts until the current Operating System (mostly Windows) is out of support. 3 to 5 years until the whle VMWare purchase i
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This is pretty much their plan and they're ok with it. When you only have to serve locked in customers, you can save a lot of money on R&D, sales, support, etc. Broadcom isn't interested in growing successful businesses, they just want to take easy money with the minimum amount of effort.
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Windows Server HCI fills the gap for 95% of SMB customers. Most SMB clusters are Windows Datacenter licensed so they can drop 3rd party virtualization licensing altogether. If your maintenance is coming up on pre-purchased VMware licenses it's a good day to be Microsoft.
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It was always a good day to be Microsoft in SMB land. Probably since server 2008r2, or 2012 at very latest, I have literally not once seen a use case for an additional license fee, for an additional patch cycle, for a feature that was already 90% parity with what was "free" with your already purchased software stack.
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You're either not paying attention, then, or not making a coherent point. Microsoft loves removing features from existing products on required upgrade and moving it to the next expensive tier.
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Yeah there is only 2 Tiers, standard and datacenter. and they stay pretty static. No subscriptions either. Granted they are trying to push alot of NEW feature to azure or cloud/Hybrid, but ive never LOST a feature over the years for the same tier.
Reason is they actually support in-place upgrades for their server products. so you have to have same features year on year to support this method.
Re:Broadcom May Have Crossed The Rubicon (Score:5, Insightful)
if you double your prices and lose a third of your customers, you are still way ahead.
In the short term. Giving up your market share of future customers who are not yet deterred by the cost of switching is where the long term cost comes in. If you are a current VMWare shop, changing could absolutely be hard and expensive. If you are a new potential customer however, that is actually a lesson.
Re: Broadcom May Have Crossed The Rubicon (Score:3)
If you were a competitor the smart move is to figure out what the cost would be to swoop in and get all those customers for as little as possible. Future licensing revenue is worth more than the loses of giving away your product for free. (If your support channel can take the increase in customer base rapidly)
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Seems to have worked for moving to the cloud. I doubt getting off VMWare would be that hard. Virtual disk formats is a known, solved problem. Wrapping that, networking and machine config will probably get 90% of other cases. Then, the last 10% is done with a "high touch, managed service" ... for a fee.
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Straw man argument.
Most installations will be less than 100. Point and click will work "ok" for most of those.
There are large installations out there, but they are the ones that can pay large consulting fees and throw cheap third world IT labour at a problem.(For cases where "large consulting fees ongoing costs of sticking with VMWare stack)
Re: Broadcom May Have Crossed The Rubicon (Score:2)
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In the short term.
However, if you're looking at your customers as a piggy bank to be cracked open, that's usually when customers start looking at their options. And there's a lot of options out there if VMware is going to get more expensive.
AWS is probably laughing their ass off while listening to the backup beeping of armored trucks arriving at their door.
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Companies have been griping about VMWare's price hikes for over a decade now. However, there isn't much competition in this space for commercial/enterprise hypervisors and management planes. You have Nutanix if you want to move your show to their "LAN in a CAN". You have Hyper-V and further being beholden to Microsoft.
It would be nice if Proxmox would get 24/7 support, and app makers would embrace the platform, as it would provide a very useful alternative. It may need some help with scaling, but VMWare
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Broadcom's changes to VMware licensing, such as ending the perpetual license program, could be crossing the Rubicon with CIOs due to the added costs of the new licensing schemes.
VMware is such a widely used IT toolbox that replacing it with other solutions would be horribly expensive for companies and potentially disruptive to their business operations.
This time I think Broadcom has gone too far with their changes to one of their acquisitions.
Some businesses have been moving to proxmox even before the Broadcom acquisition and more are planning to now. I guess it's good news for proxmox. I haven't used VMWare for our own stuff since ~2010 and all our infrastructure is virtual machines based.
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Sorry, it's not like you didn't have the writing on the wall to read. Anyone with half a brain - presumably, this includes most CIOs - knew this was happening the moment VMWare's board approved the acquisition. This is, after all, the entirety of the Broadcom business model: purchase companies, raise prices drastically while driving off the majority of customers in favor of a few, lucrative customers.
The writing on that wall was done Nov 4, 2022. There was time to take initiative and find a ship that wasn't
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That was the plan all along. They know large users can't change easily. They own CA, so they know how legacy IT products work and that some customers will pay a million dollars a month to not have to change anything.
Produces? (Score:3)
VMware and Broadcom will have to engage more actively with customers on the value of new produces
I'll take 4 tomatoes and that head of lettuce along with my ESXi extortion fees, please.
Who edits this stuff?
On a serious note, there's alternatives but they still lack in some way or another.
The winners here are likely going to be aws and azure.
This may be a case where Broadcom starts hearing very bad things from their new-to-them customers. I, for one, do not welcome our new vmware overlords.
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My boss has been pushing me to consider Microsoft Hyper-V for years and I reject the calls because VMware is just that much better. With Broadcom's new push, we are likely to see VMware go the way of Novell, Netscape, and so many other systems and applications that were superior but ended up pricing themselves out of business or were just too inconvenient when using in the Microsoft environment.
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Enshitification continues at record pace (Score:3, Interesting)
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In the long term, I guess it makes sure no company lives forever.
The result of yet another mega merger (Score:5, Insightful)
The past 3 decades of mega merger really is starting to show a track record of if not bad results but mostly neutral to slightly negative? Definitely very few had positive results. Let's list some out and see if humanity in general benefitted from allowing such large transactions? That question is only 30% snark, there might be definites for people more tied to these products
Lets start at the top
Broadcom and VMWare? Did this need to happen? What are VMWare customers getting from this?
IBM and Red Hat? Any upsides from this?
TMobile and Sprint. My bill hasn't dropped in price, in fact it went up a little. I dont really notice an uptick in service.
ATT and Time Warner. We all know how much of a joke HBO has become, I don't see anything great from them being together than it was apart.
Heinz and Kraft. Anything?
Dow and DuPont?
Verizon and Vodafone?
NBC and Comcast?
Facebook and Instagram? Facebook and Whatsapp? Facebook and anything at all?
I am sure there are some positive examples but I feel like in the realm of acquisitions in the multi-billions it's all just top level consolidation, I think the benefits to the customers are small and far apart.
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The mergers are completely focused around monopolization, which is what happens when "over-regulated" companies are not regulated.
In the electronic CAD software space the goal is to absolutely milk customers for every last penny, because changing vendors is fairly painful.
The last thing you want to do is to allow a lower cost alternative, or any alternative, to exist otherwise you can't keep raising the license costs every year for no reason.
So naturally, you buy the competitors and do the absolute bare min
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As someone who uses some CAD software who are the worst offenders in your opinion? I assume Autodesk is the 800lb gorilla in the room.
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Nevermind that CAD functionality peaked around year 2000. There's been very little of value added since, and the door is basically shut for hobbyists due to cost.
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Facebook and anything at all?
Well... at risk of defending the worst company on the list, Facebook and Oculus. There's no way VR would be where it is now if it weren't for Facebook's injection of capital.
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Maybe? That's an interesting one. Does Oculus get normal VC funding and goes it alone? Maybe Oculus gets purchased by another big competitor like Aple Or Google or MS? Maybe Valve ends up taking the lead with their headsets. Hard to say.
While Facebooks capital injection definitely helped push the medium on the other hand Facebook's reputation at this point precedes itself and while anecdotal, I have no considered any Oculus hardware because of it's software ties to FB despite the hardware being nice ove
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The whole point of Zuckerberg's acquisition of Oculus was to get on the VR hype train. He had no actual plans for the product's future beyond "milk it for all it's worth" and "tie the usage data from it to Facebook." If it took off, Oculus would have made Facebook into VR's gatekeeper and that would have meant a shitton of extra user data for selling to advertisers and data brokers.
Unfortunately for Zuck, and the "fad" as a whole, his lack of ambition c
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Doesn't answer my question.
You could have done so by pointing out "a target of the benefits got this from this merger" but you didn't and this offers nothing to think about.
I award you 0 points. Do better next time.
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That pretty much supports what I said, no advantage to consumers, ergo i believe the FTC should be far, far, far more skeptical when approving these types of deals, almost default to deny unless one of the firms is in distress and even then I would prefer in that case for them to be absorbed into any competitor besides the market leader.
No company has a "right" to a merger so if it doesnt help anyone outside the company or shareholders thats fair enough for me to deny.
VMware went bovine a long time ago (Score:3)
I was involved with VMware when the corporate strategy changed from innovating the product to milking the cow. It's not surprising that some of the cows aren't happy with the announced upcoming optimization strategy. But remember, happy cows come from California!
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I though happy cows worked for Carnation.
INVEST in conference room chairs. (Score:1)
Conference room chairs is the future. They will soon be depleted, as companies
across the world are meeting to come up with DRPs to replace VMware with non-
hostile software.
Broadcom, in a display of fingers in the ears head in the sand stupid have taken the
highest profit virtual emulation solution and turned it into a dumpster fire. It's not as
simple as "Well, they're now going to charge more." It has to do with partners, agreements,
distribution channels, and COMPLETELY DESTROYING ANY TRUST that their cus
This is true (Score:1)
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Question remains, what else is there? (Score:1)
Even if you're willing to switch... what to?
HyperV? Certainly not. Managing any deployment beyond twenty or thirty hosts can become a nightmare. Windows Updates are unreliable. Certain companies don't even trust the cluster updating tool. I've worked for one that used a 1500 line of PS code script to manage updating but it was clunky at best because there doesn't seem to be label à am in the process of doing upgrades". At some point, MS will just introduce yet another reboot and your script screws its
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Thanks, that's good to hear and gives hope.
Broadcom is not a âoechip giantâ (Score:5, Informative)
Broadcom is a predatory leveraged buyout giant formerly known as Avago. The real chip maker Broadcom was one of its victims. It took its name, too.
Why Broadcom? (Score:1)
Enshitification commences (Score:2)
We can't have anything nice.
Opinion (Score:2)
I'm personally impacted by the end of the free tier for ESXi. I maintain a robust home lab that has included ESXi for more than a decade. Those machines will go to hyper-V or virtualbox now.
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I switched to VirtualBox after VMWare player got too expensive and would be sad if VitualBox would change its model. But I have no rights to complain since I have not paid them a single dime.
VMWare has many customers, some of them bring very little return, but may take up significant eff
Re:Opinion (Score:4, Interesting)
I, personally, am not a customer. That's true. We do not have a direct first party relationship.
That said, the companies I work for and with *are* VMware first party customers and they receive significant benefits from the experience I've gained from my second party relationship with VmWare. E.g. I've saved my customer's days of work with the hands-on knowledge that copying of a large VM with SSH is orders of magnitude faster than pulling it out of vsphere.
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Some of us may not be customers but we tend to keep an eye and "play with things" on our own time and with our own resources at home.
And if our customers / company may have a need for something similar to what we are already playing with, we may end up as an advocate for those things we "played with" and like.
Guess that means since we can't "play with your things" we don't know enough about your things to push your products for you when we think it may be suitable.
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Beware!
There ARE things that can't be done under virtualbox... Maybe, yet.
First one that comes to mind is mildly esoteric... PCI pass through.
This allows a VM to have full control of hardware elements of the virtualization host.
This is how Nutanix does it's storage "magic"... A VM is given control of the majority of the storage controllers on the host.
Nutanix is KVM/qemu/libvirt under the hood. PCI pass through is inherent with that mix.
Not at Nutanix, but I've also seen network controllers and GPU/video
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True. Hyper-V has some hardware passthrough capabilities in this space, but I don't have experience with it. (The docs page URL will make you think it's just for GPUs, but it works for e.g. NVMe storage too.)
https://learn.microsoft.com/en... [microsoft.com]
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That sir/m'am... Is simply a label.
They are the same thing.
A VM get's dedicated control of hardware control
https://en.wikipedia.org/wiki/... [wikipedia.org]
Virtualbox still can't do it.
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Helpful content (Score:1)