As you may have seen, following the completion of the Broadcom acquisition, “VMware by Broadcom” are no longer offering perpetual licenses for their products as they move to a subscription model. They have also moved to drastically reduce the breadth of their portfolio. In the meantime some customers are already reporting 1200% price rises…
To that end, many products are being killed off completely* and for those that remain, many will no longer be available as standalone SKUs. Instead, they will be available only via two primary bundles being offered by VMware; either as part of VMware Cloud Foundation (VCF) or VMware vSphere Foundation (VVF). They will not be available for purchase as standalone point solutions.
* The full list of these products is here and includes many flavours of vSphere as well as desktop focused products. The Aria SaaS product lineup is also being discontinued other than within the below bundles.
This is VMware’s solution for customers looking to “capture the value of full stack infrastructure” and includes:
This is for “datacentre optimization in traditional vSphere environments” and includes:
A range of “add-on services” will be available on top of these bundles to add further functionality around “storage, security, disaster recovery, Generative AI” and more.
It seems that “vSphere Standard” and “vSphere Essentials Plus Kit” will be available as standalone subscriptions for smaller organisations.
This new capability will allow customers to deploy their VMware Cloud Foundation subscriptions on-premises and in “VMware validated hybrid cloud endpoints”. This will be a new set of rules and metrics for ITAM managers to learn!
At the time of VMware making this announcement, the VMware Reddit forum has been heating up with complaints from customers having issues with their licensing, as it appeared the OEM Portals were down. Quoting from a post by Michael Leonard, a former Senior Product Marketing Manager at VMware, “People can’t get pricing, they can’t get support, they can’t renewals, they can’t activate licenses. I’ve never seen anything like this in 15 years of working in IT and 25 working for 8 vendors.”
Here are some of the comments that Michael quoted from the (unofficial) VMware subreddit (as with all Reddit posts, note we are unable to independently verify these comments):
As of earlier today however, one of our customers got the following response when they followed the exact process VMware told us to use barely a week ago: As of now all the OEM Portals are not operational and we are unable to assist with redeeming the PACs at this time. We are expecting more updates to come very soon” So VMware is now not even honoring licenses sold in 2023 and just telling Customers “Sorry, you need to just wait until we figure our s*** out”
It is actually insane that they have gone this long without releasing pricing. They’ve cut off OEM licenses, stopped new deals and renewals globally, and the only guidance they’ve provided is a list of products that are dead. So now you have people that have their deals and businesses stuck in limbo for months while Broadcom fiddles around. This isn’t how a customer focused business behaves.
It is really hard to stay positive when our licensing cost is going up ~1200%+ and my leadership team is looking for someone to blame. Many people have already lost their jobs as part of this merger, and many more people will potentially lose their jobs as companies and partners struggle with the licensing cost increase and rug pulling.
According to one particularly disgruntled Reddit poster at a UK university (whose account was left anonymous for obvious reasons), they are facing a whopping 1250% uplift in VMware support in their upcoming renewal in the next few weeks.
“We were quoted very recently to renew our support contract for another year, which was in the region of £40k. After being told this would be need to be requoted, we’ve been given an “indicative” figure now of approx £500k/year, or just over £1.1m for 3 years. We’ve been told we could have some reduction as we “trade-in” the perpetuals so we’re waiting a full and final quote, but again we’re told the prices should be “indicative”.
On questioning where on earth such an uplift has come from, we’ve been told that because we’re education, we’re being forcibly classified as a “strategic” customer and so are only allowed to be sold the full cost VMware Cloud Foundation product and nothing else.”
If this is indeed VMware/Broadcom’s new policy – with education now being classified as strategic and thus not subject to discounts – it is unlikely this case will be isolated. However, it may not be as bad as the poster suggests. We’ve seen that partners can no longer get deal registration on deals for “strategic customers,” – we believe this is because Broadcom now wants to deal with them direct. So, in this instance their partner can no longer get the deal registration discount but, if/when the customer goes direct to Broadcom, the discount should hopefully be there again. Fingers crossed for this poster.
If you have any other insights or tips you can share to help this particular poster, I’m sure they’ll be grateful! You can access the original Reddit post here.
In the meantime Is-Not-El summed up the collective response rather well “Welcome VMware to the Oracle club of amazing companies to work with. Should I expect the mobsters, excuse me, the license audit team this year or that pleasure is reserved for 2025?”
These changes won’t impact existing customers until renewal but there’s plenty to do in the lead up to that point – especially if your renewal is coming up soon (see above)! Get a clear view of your VMware portfolio – both what’s been purchased and what’s in use – and work with stakeholders to map out how these changes impact you. If you are finding your historical discount appears to have disappeared, it will also be worth speaking with Broadcom directly.
To provide additional context we reached out to Barry Pilling, the Founder and Principal ITAM Consultant at Cortex Consulting and lead trainer on the newly-launched LISA VMware Licensing Training course. His comments are as follows:
A couple of things that are worthy of mention:
For more detailed and practical advice from Barry on what to do to maximise your VMware investments, as well as the latest insights into VMware’s audit practices from someone who is actively involved in defending them, consider the new course VMware Licensing Training, on LISA, the on-demand training service from the ITAM Review.