Transformative Changes Since VMware’s Acquisition by Broadcom

In the ever-evolving landscape of technology, acquisitions often serve as catalysts for significant transformation. One such notable acquisition was Broadcom’s acquisition of VMware. This strategic move has brought about a series of impactful changes, reshaping the way VMware operates and delivers value to its customers and partners. 

Transition to Subscription-Based Model

One of the most significant changes post-acquisition has been VMware’s transition from perpetual software licenses to a subscription-based business model. This shift aligns with the broader market trend towards cloud operating models, offering companies more flexibility and scalability in their software usage. In addition to the licensing changes, their offerings were consolidated and certain SKUs eliminated. This has led to some companies seeing dramatic increases in their renewal costs. In some cases, a 10X increase. You need to be sure you are planning the right process to help avoid surprises come renewal time.

VMware by Broadcom moved quickly to consolidate and “simplify” their product offerings, effectively bundling many popular products into a small number of distinct combined product offerings while discontinuing individual sales of individual products. Below is the feature comparison of these new offerings:

Further to Broadcom’s acquisition, in February 2024 Broadcom agreed to divest VMware’s End User Computing decision to KKR, which has become a standalone company called Omnissa. 

Enhanced Partner Programs

Broadcom has introduced the Advantage Partner Program, specifically designed for VMware resell partners. This program includes modular training, solution transformation, and resell agreements, aimed at simplifying product offerings and enhancing upsell opportunities.

Support Account Migration

As part of the integration process, all VMware support accounts are being migrated to Broadcom’s support system. This migration requires companies to activate their Broadcom support accounts and update their profile information to continue accessing support services. To ensure timely response to support issues, companies should ensure they activate their accounts in the new Broadcom portal.

Business Transformation and Investment in R&D

Broadcom’s acquisition has also led to a substantial investment in research and development, with a $4.9 billion investment aimed at driving innovation and expanding VMware’s product portfolio. This investment underscores Broadcom’s commitment to maintaining VMware’s leadership in the industry.

Changes in Organizational Structure

The acquisition has brought about changes in VMware’s organizational structure, with some employees receiving new roles and reporting lines within Broadcom. This restructuring aims to streamline operations and enhance collaboration across teams. This has led to some challenges with response times. This will continue to improve over time, but major change is always disruptive.

How IT Teams Should Respond

Times like these require clear understanding and actionable advice. Where should they begin? You need  visibility into your IT environment and plan your cloud and virtualization roadmap simpler. Business leaders can assess their use of VMware products and complete audits using effortless inventory tools and automated reporting and executive summaries.

Future Outlook

The acquisition of VMware by Broadcom marks a new chapter in VMware’s journey, characterized by strategic shifts and enhanced capabilities. These changes not only reflect the evolving needs of the market but also position VMware for sustained growth and innovation in the years to come.