News

CloudBolt Paper Examines 'VMware Acquisition Aftermath'

• By David Ramel
• 06/07/2024

CloudBolt published a whitepaper examining the aftermath of Broadcom's acquisition of VMware last year.

Titled "VM Ware Acquisition Aftermath," the paper from the "cloud ROI company" is based on a survey of VMware-using organizations that sought to gather "real-world responses and strategies as they grapple with the acquisition's implications."

Broadcom's acquisition of VMware in November 2023 stirred ongoing controversy, much of it of the licensing kind.

CloudBolt is a competitor of Broadcom/VMware -- especially in the cloud management and automation space -- and the study based on a survey conducted by Wakefield Research lists key findings including:

• High level of concern about Broadcom acquisition: An overwhelming majority of respondents (99 percent) expressed concern about the potential impact of Broadcom's acquisition of VMware on their business, with 76 percent being extremely or very concerned.

  

• Acquisition viewed as disruptive to IT strategy: 95 percent of respondents consider the acquisition disruptive to their IT strategy, with 46 percent viewing it as extremely/very disruptive.

  

• Expectations of steep price increases: All respondents signaled that they expect VMware prices to increase, with 73 percent anticipating more than a 100 percent price hike under Broadcom's ownership.
• Contract expirations coming soon: 69 percent of companies surveyed have VMware contracts expiring within the next 12 months.
• Decisions happening within the next year: While only 5 percent have already decided on their go-forward response to the acquisition, 58 percent plan to decide within 6 months, and 87 percent within the coming year.
• Multi-pronged approach of keeping and replacing VMware: When asked to select all possible courses of action under consideration, the top two responses were keeping some VMware solutions (43 percent) or remaining with VMware altogether (40 percent).
• Equally dispersed concerns leading to change: Top factors for companies moving away from VMware in part or whole are equally dispersed across various factors, with no single one being the primary reason. These include:
  • Uncertainty about Broadcom's plans: 36 percent
  • Concerns about support quality: 36 percent
  • Partner relationship updates: 36 percent
  • Required shift to subscription licensing: 34 percent
  • Anticipated price increases: 33 percent
  • Personal negative experiences with Broadcom: 33 percent
  • Broadcom's reputation from past acquisitions: 32 percent
  • Forced packaging/bundling of products: 30 percent
  • Worries about reduced innovation: 29 percent
• All VMware solutions under examination: Of companies who plan to abandon VMware solutions, vSphere (hypervisor) and vRealize (cloud management) were the top listed products. However, it should be noted that every primary VMware offering (NSX, Tanzu, vSAN, Horizon) received more than 30 percent likeliness to abandon.
  • 39 percent vSphere (hypervisor)
  • 37 percent vRealize (cloud management)
  • 34 percent NSX (networking)
  • 33 percent Tanzu (Kubernetes)
  • 31 percent vSan (storage)
  • 31 percent Horizon (VDI)
  • 0 percent Other

CloudBolt listed this methodology for the report:

• The survey included 300 IT decision-makers at the director level and above
• Respondents were from companies headquartered in North America that use VMware
• The survey was fielded from May 9-23, 2024, using an email invitation and an online questionnaire
• Results subject to sampling variation of ±5.7 percentage points at the 95 percent confidence level

In February CloudBolt published a blog post titled, "VMWare Alternatives: Exploring migration options after Broadcom acquisition."