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300% Price Hikes Push Disgruntled VMware Customers Toward Broadcom Rivals (arstechnica.com) 122

After closing a $69 billion deal to buy virtualization technology company VMware a year ago, Broadcom wasted no time ushering in big changes to the ways customers and partners buy and sell VMware offerings -- and many of those clients aren't happy. ArsTechnica: To get a deeper look at the impact that rising costs and overhauls like the end of VMware perpetual license sales have had on VMware users, Ars spoke with several companies in the process of quitting the software due to Broadcom's changes. Here's what's pushing them over the edge.

For some, VMware prices more than tripled under Broadcom Broadcom closed its VMware acquisition in November 2023, and by December 2023, the company announced that it would stop selling perpetual VMware licenses. VMware products were previously sold under 8,000 SKUs, but they have now been combined into a few bundle packages. Additionally, higher CPU core requirements per CPU subscription have made VMware more expensive for some reseller partners.

"As on-premises virtualization projects move from [enterprise license agreements] and perpetual licenses to new bundling, socket-to-core ratios, and consumption models, the costs and pricing can increase two or three times," Gartner's 2024 Hype Cycle for Data Center Infrastructure Technologies report that released in June reads. Numerous VMware customers I spoke with said their VMware costs rose 300 percent after Broadcom's takeover. Some companies have cited even higher price hikes -- including AT&T, which claimed that Broadcom proposed a 1,050 percent price hike. AT&T is suing Broadcom over perpetual license support and says it has looked into VMware alternatives.

300% Price Hikes Push Disgruntled VMware Customers Toward Broadcom Rivals

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  • by aqui ( 472334 ) on Thursday October 31, 2024 @10:50AM (#64908991)

    Anyone facing this issue where they work? What have you looked at?

    (fingers crossed first post).

    • Anyone facing this issue where they work? What have you looked at?

      (fingers crossed first post).

      We've always been on Docker. I haven't heard of anyone in my circles using VMWare for almost 20 years now. I was actually wondering who still uses them. Is it just legacy apps...like those folks who still use IBM Mainframes or DB2?...or are there good reasons for choosing VMWare for hosting servers?

      • by GWXerog ( 3151863 ) on Thursday October 31, 2024 @11:20AM (#64909077)
        How to I host Microsoft Exchange and an Active Directory DC in a docker container? Docker/Kubernetes are container management platforms. VMWare ESXI is a hypervisor. The technologies and use-case are entirely different
        • by guruevi ( 827432 )

          Microsoft themselves are eliminating Microsoft Exchange and AD on-prem and forcing customers into cloud with containerized extensions for on-prem functionality.

          The vNext versions of Windows Server/Exchange etc are all required to be integrated with your Azure instance so basically the local stuff is just a proxy for Azure.

          • by Z00L00K ( 682162 )

            Microsoft is now on the path to hold every business in the world by the balls.

            I just wait for the day when Microsoft suddenly becomes unavailable due to an intrusion.

          • by ebh ( 116526 )

            So what are people whose data centers are on air-gapped networks supposed to do? (Serious question.)

            • by lsllll ( 830002 )

              I jest, as I know what air-gapped really means, but for taking it literally, there's always this [hackaday.com].

      • by Ed Tice ( 3732157 ) on Thursday October 31, 2024 @11:26AM (#64909101)
        There are many places that still use VMWare. I'm not involved in the price negotiations so I don't know how hard we've been hit.

        VMWare's enterprise solutions let you do things like migrate virtual machines between physical hardware. Docker isn't a substitute. My particular use case is when we host temporary servers for customers. We create a dedicated VMWare host. When we are done, we delete the host and the backups and send an attestation that we have done so.

        There is probably a solution we could build using Docker. But the one we have is built using Puppet and Foreman and existed before Docker was a thing. There isn't really a reason to migrate to anything else. Or at least there wasn't, depending on the cost.

        We host in our own data center due to it being much cheaper than using GCP. But our Puppet/Foreman setup can create hosts in GCP if the customer desires (such as if they insist on the VMs being in a particular region.) If VMWare were to triple our costs, it would suddenly become cheaper to get all of our CPU from Google and simply decommission our data center.

        It's not quite the same as using IBM mainframes or DB2. Those things are ungodly expensive and ever use of them that I've seen has tried to migrate away and failed. But if VMWare really goes through with this price hike, you're right, that only the people who failed to migrate will be using it.

        • VMWare's enterprise solutions let you do things like migrate virtual machines between physical hardware.

          But you can do that with libvirt... is there any compelling reason to stick with vmware besides inertia?

          • I don't know. The physical/virtual infrastructure is maintained by an IT team separate from those of us who work on applications. The three options constantly being evaluated are (a) stick with VMWare, (b) use a different virtualization infrastructure in our data centers, or (c) move everything to GCP. But I do not play a significant part in those decisions.

            The applications that we host in virtual servers are all going to, at some point, be cloud native and run inside of Kubernetes. At that point, we

      • There is still shitloads of it in Fortune 500 business that hasn't figured out how to get off Windows Server yet. Institutional inertia is very hard to overcome the bigger the business is.

        • There is still shitloads of it in Fortune 500 business that hasn't figured out how to get off Windows Server yet. Institutional inertia is very hard to overcome the bigger the business is.

          Makes perfect sense that they would have Windows Server for various reasons. I am not personally a fan, but see value in the Windows Server infrastructure (C# SQL Server, etc) ...it's a worthy competitor to the products I use. However, doesn't MS offer virtualization in their Windows Server products these days?

          • by slaker ( 53818 )

            It's called Hyper-V and it's been included as part of desktop and Server Windows since the days of Vista / Server 2008. If you have a Pro or Enterprise SKU of desktop Windows, it's a standard OS component.

        • by Z00L00K ( 682162 )

          That's because management of today is burnt in with that Microsoft is the safe choice. The same as IBM was the safe choice in the 1980s.

          Today IBM is a corner case company.

      • by sodul ( 833177 )

        After having worked with k8s, AWS EKS more specifically, for the past 6 years I can tell you that k8s is not good if you are I/O heavy. I would not recommend anyone to run a proper file storage, a database, or any old school service with high I/O on it.

        If you run k8s in a public cloud you delegate all the I/O heavy stuff to the cloud services such as S3, DynamoDB, RDS, and only have stateless (or as stateless as possible) services in k8s.

        Part of the issue is the way kubernetes and the linux kernel, handles

      • Used to use it a bunch, because we were on Macs and occasionally would need a Windows application, or Linux. Now on Windows it is rare to need a MacOS application, and WSL works just fine for the Linux side, so VMs aren't that useful for me anyway. Though to be fair, WSL is a hypervisor which is related to VMs.

        I never used VMs as a way to get multiple servers on a single physical server, since I don't do server or web stuff. But containers are much more suitable for those things, whereas VMs to me were f

    • by ctilsie242 ( 4841247 ) on Thursday October 31, 2024 @10:59AM (#64909017)

      I have been at companies/orgs looking to get away from VMWare for about a decade now. What VMWare brings to the table is the best control plane out there, solid scalability, ease of use for their clustered filesystem (VMFS is a heck of a lot easier to deal with than GlusterFS), and a number of features, like fault tolerance where a VM can keep going even if the hardware it is running on falls over, as another shadow VM took over.

      I'm seeing people move to Hyper-V, Proxmox, and XCP-NG. Some are moving to Nutanix, but that is more of a hardware and software stack than a virtualization platform.

      Proxmox is getting there. It has been hamstrung for years by lack of third party development, but Veeam, Nakivo, and other backup program makers are supporting it, so it is starting to emerge as a solid rival to VMWare on some fronts.

    • by Nick ( 109 )

      A mix of KVM (Proxmox) and container orchestration (sitting on baremetal or Proxmox).

      Looking at Apache CloudStack for multi-tenant cloud provisioning.

      • My friend worked at a hosting company that was all bare metal, or bare metal and containers. They standardized on Dell using OpenManage to automate installs and updates. He said the cost savings and performance gains made up for the cost of not being able to overprovision hardware. I'd imagine with the VMWare price hike, it's even more cost effective.

      • by sheph ( 955019 )
        I looked at Proxmox in my lab at home. It works, but when I started bundling network ports to get more bandwidth and redundancy it seemed to work intermittently. Whereas with VMWare it was really solid. It could have maybe been solved by changing the settings in my network equipment too. But I tried Nutanix community and it just worked. So I went that route instead.
    • Hyper-V over here.
      Yes, there are things VMWare can do that Hyper-V can't. We don't use any of those features.

    • by Anonymous Coward

      Anyone facing this issue where they work? What have you looked at?

      For large corps (100,000+ users) there are no alternatives besides cloud. And many of them are using VMWare in the cloud (yes it is a real product). Anyone claiming they have an alternative isn't worried about availability, backups, & DR...

      • by guruevi ( 827432 ) on Thursday October 31, 2024 @11:56AM (#64909185)

        I have 250k+ endpoints on the network, we use Proxmox, works better than VMware, and is cheaper, it has things like live-restore. All the extra DR, vGPU, SDN and other stuff costs extra on VMware/HyperV if it is at all "validated" to work together. We had a cluster of VMware for decades apparently, a few years ago, there was a problem between the IBM SAN and the Cisco server hardware (firmware bug) that took out the entire cluster and VMware just pointed the finger at Cisco, then at IBM, then at Red Hat (which was the OS that the SAN management plane was installed on), then at the network (also Cisco), then finally after about 3 days admitted they were to blame. Off course we had another datacenter to fall back on, but it's really painful to pretend your datacenter burned down when it's VMware shit product. We have been migrating off VMware to Proxmox with the goal of moving completely before the current version goes out of support and we'll have to change the licensing models. We got the quotes for renewal, my CIO nearly had a heart attack, it cost almost as much annually as our last "perpetual" license (which is good for ~5-7 years typically), instead we're hiring a few more people.

    • by Tempest_2084 ( 605915 ) on Thursday October 31, 2024 @11:40AM (#64909139)
      At my company we're switching to OpenShift which sucks way worse than VMWare and requires way more servers to run, but we refuse to be shafted by Broadcom.
    • by sheph ( 955019 )
      We went to Nutanix and couldn't be happier.
    • Azure, Windows 365 and Hyper-V are being rolled out in a large scale at the 80k employees company I work for. All the systems from the 90+ worldwide locations we can move out to the cloud are going that way, those staying are being upgraded to newer Windows Server OS versions and put on Hyper-X. On a positive note, countless duplicates are being converged to multi-tenant systems as well - and a lot more trust being put on the Azure and SDWAN availability across multiple units worldwide.

      Broadcom has killed a

    • by CEC-P ( 10248912 )
      Scale Computing. You can train someone on it in minutes and their support is basically perfect. It's bad at core but perfect at edge computing and most stuff in the middle. We have our DCs on it, for example. I just wouldn't run a datacenter on it.
    • by Mousit ( 646085 )

      Anyone facing this issue where they work? What have you looked at?

      At my workplace, which would probably be classed small to maybe medium-ish (around 50-60 VMs and a user count in the mere hundreds), we use SCALE Computing's HyperCore [scalecomputing.com] product. It is KVM-based, though pretty customized by SCALE. We previously used VMware but were already moving onto SCALE well before the buyout, and at this point we are 100% SCALE.

      While it certainly has its limitations (in particular no hardware passthru, so you're not getting any virtual USB or serial devices), it has worked well for o

    • We moved to Nutanix shortly after the purchase by Broadcom. We were lucky to be able to make the move as we needed a hardware refresh at the same time.

      We are using their hypervisor.

      So far, wonderful.
    • >"What are the alternatives for enterprise scale?"

      That depends entirely on your definition of "enterprise".

      XCP-ng + Xen Orchestra can meet the needs of a huge range of VMWare installations. Plus it is open source. Plus it is free, and/or you can buy full support (strongly recommended for corporate/large/serious rollouts). Active and vibrant development, and just released 8.3.
      https://xcp-ng.org/ [xcp-ng.org] https://xen-orchestra.com/ [xen-orchestra.com]

      They even have tools that can warm migrate VMware hosts to XCP-ng (and various

    • A lot of my old clients (I am out of the systems engineering business but still meet up with my old clients periodically) are taking the opportunity to refactor many of their applications to cloud-native solutions, both private and public clouds. It's a pretty large lift-and-shift and usually requires some staffing changes or training for the new server stacks, but it's an easy sell to the C-suite when you're looking at such a significant price hike. This is especially true for those clients with perpetual

  • by MpVpRb ( 1423381 ) on Thursday October 31, 2024 @11:07AM (#64909043)

    ...make the product worse for customers.
    Just say no to software subscriptions

    • by butlerm ( 3112 )

      You could always support some product that is vaguely open source, like something based on Linux KVM or anything from RedHat.

  • When will we ever learn? Use open source software with easily interpreted data files and multiple alternatives that can read those data files. If you must use cloud computing keep it open source. Encrypt to the extent possible and perform regular secure backups in multiple locations.
  • From the VARs we've spoken to the only "real" approximate replacement is Nutanix. No way around it really, companies love the opex expenses of the cloud vs capital, even if they are getting reamed.

  • by MikeDataLink ( 536925 ) on Thursday October 31, 2024 @11:58AM (#64909197) Homepage Journal

    We just took a few months and made it the top priority to get rid of it. We did it. It's gone.

  • by WolphFang ( 1077109 ) <m,conrad,202&gmail,com> on Thursday October 31, 2024 @12:26PM (#64909287)

    At my office we use XCP-ng, though it lacks support for nested virtualization with Windows guests, which breaks WSL2, Docker on Windows, etc. They are supposed to be working on a fix. See [https://github.com/xcp-ng/xcp/issues/105](https://github.com/xcp-ng/xcp/issues/105).

    Generally, setup is easy, clustering is a thing, you can live migrate VMs to other hosts, and you can live migrate VM disks to other storage arrays as well. There is also support for vTPM in the upcoming 8.3 release and it the current LTS 8.2 supports secure boot.

    AT&T should hire staff and fix the nested virtualization issue and release their work as part of the open source setup. Maybe REALLY screw over Broadcom that way.

    -Mike/NewsRx

  • For my homelab, my pile of junk aged out of ESXi on CPU features at the end of 6.7. I moved to Proxmox VE, and picked up native LXC containers and live migration, which wasn't supported on the free license ESXi. But I deliberately keep my networking simple, and use BSD/ZFS based TrueNAS, don't dabble with Ceph, etc... So far, it gets what I need to do done. But I can't say how well it scales beyond 30 - 40 VM's/containers.

    That said, in a larger environment, I would probably look at Nutanix. Redhat's beh

  • Demand destruction

    "Demand destruction is a permanent downward shift on the demand curve in the direction of lower demand of a commodity, such as energy products, induced by a prolonged period of high prices or constrained supply."

    https://en.wikipedia.org/wiki/Demand_destruction

    The market finds a way

    If the high prices are prolonged, it incentivizes others to find a solution to meet the needs of the users who are unwilling or unable to afford a product or service.

  • by gweihir ( 88907 ) on Thursday October 31, 2024 @02:50PM (#64909715)

    No exceptions. All their products I have ever used were bad on the engineering side, and that very much includes the RP. Designed by incompetents with components from cretins.

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