- 1.5 times higher for 3 year subscriptions
- 2 times higher for 5 year subscriptions
Major Changes After Broadcom Acquired VMware
VMware was recently acquired by Broadcom on November 22, 2023. Here are the challenges the acquisition brought to customers.
Long-Term Subscriptions Have Become More Expensive
Weakened Regional Office Operations
Changes at regional offices bring uncertainties in terms of support quality and continuous and localized innovations.
Customers Need to Either Downgrade or Upgrade
vSphere Enterprise Plus customers might need to either downgrade to the Standard edition with fewer features or upgrade to vSphere Foundation with potential surplus features.
Customers Can No Longer Purchase Some Standalone Products
vSphere Foundation customers can no longer purchase 24x7 support, Aria Suite Enterprise, NSX Networking, or access to SRE as standalone products without upgrading to the new VMware Cloud Foundation bundle.
Long-Term Subscriptions Have Become More Expensive
- 1.5 times higher for 3 year subscriptions
- 2 times higher for 5 year subscriptions
Weakened Regional Office Operations
Changes at regional offices bring uncertainties in terms of support quality and continuous and localized innovations.
Customers Need to Either Downgrade or Upgrade
vSphere Enterprise Plus customers might need to either downgrade to the Standard edition with fewer features or upgrade to vSphere Foundation with potential surplus features.
Customers Can No Longer Purchase Some Standalone Products
vSphere Foundation customers can no longer purchase 24x7 support, Aria Suite Enterprise, NSX Networking, or access to SRE as standalone products without upgrading to the new VMware Cloud Foundation bundle.
| vSphere Essential Plus/Standard editions ≤ 6.7 on a perpetual license |  |
Forced to switch to a subscription, leading to higher costs in the long run |
| vSphere Enterprise Plus editions ≤ 6.7 on a perpetual license | |
Forced to switch to vSphere Foundations, leading to surplus features and higher costs |
| vSphere has expired or will be expiring in 2024 | |
Unable to renew, forced to buy a subscription |
| Currently using vSAN version < 6.7 or vSAN has expired or is expiring soon in 2024 | |
Switched to a per core and capacity-based subscription |
| Considering purchasing SAN storage (IP SAN, FC SAN) | |
High cost of maintaining external storage |
| Planning to expand the existing VMware Cluster | |
Need to buy a subscription for the entire cluster, not just the expansion |
| Planning to implement disaster recovery using VMware | |
Need to buy a whole set of VMware long-term subscription licenses |
The semiconductor and infrastructure software giant, Broadcom recently acquired VMware for a staggering deal of $61 billion on November 22, 2023. The acquisition was followed by dire changes to VMware licenses, its business groups and regional offices, most of them negatively impacting customers and partners. The biggest consequence of the acquisition was the change of the VMware perpetual license to the VMware subscription license. According to our analysis, this switch in VMware licensing model burdens customers with VMware license cost, colloquially known as vTax.
Along with the rise in VMware license costs, customers and partners must bear reduced support due to the closure of multiple offices, especially in Asia-Pacific. The reduction in manpower, especially in the Asia-Pacific, can result in slow innovation, delayed responses, and less localized support. Broadcom plans to divest a few of VMware’s non-core assets while making additional changes such as add-on features, bundling, and minimum purchase capacity to VMware Cloud and vSphere Foundation.
The Broadcom VMware licensing change, potential layoffs and office closures, simplified offerings are forcing customers to reconsider and switch to other vendors in the market. The recent news of Dell’s contract termination with VMware, KKR firm’s acquisition of VMware’s End User Computing business further attests to the turbulence brought by the acquisition.
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Sangfor vs VMWare: Product Architecture Comparison
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