VMware GUTS Customers with 10x Price Increases

We discuss how some VMware customers are being faced with 10x or more price increases in the wake of the Broadcom acquisition changes.

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Timestamps
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00:00 Introduction
02:11 Broadcom VMware Acquisition Strategy
03:07 Broadcom Avago Acqusition History PLX PCIe Switches
04:28 Broadcom Playing Hardball on NIC Pricing with HPE
06:37 VMware Farms its Locked-in Installed Base
08:55 The VMware VCSP 10x Price Increase for MSPs
14:30 VMware Admins going the way of the Mainframe Admin
16:17 Key Lessons Learned

[SeaJay_Oceans]

'The company that you built your business on . . . ' CNE Novell Networks system engineers silently shed a tear . . . 😢

[swayne]

Cutting the free version is like putting a ticking time bomb on growth. In 5 years when no new people have ever used the product it's just going to dry up.

[itskyb]

My company's VMware cost increased 8x. That is after negotiations. Now, we are looking to minimize VMware use. This is a shame as I love VMware and have been using it for 20 years in various forms.

[Zecko]

We ran a datacenter with 800.000+ VMs back in 2019, Migrated to Xen & Oracle & k8s in 2020.
Upgraded the leaf switches to 40G ports towards the servers with the money saved.
Boy am I happy for my ex-employer today. 😂

[ivanmaglica]

There must have been a big party at Proxmox HQ when this was announced :)

[tomo]

Glad I didn't do any VMware qualifications! "Broadcom - where companies go to die."💩

[michaeljarcher]

FYI: My friend who's was a UK employee told me this:
1032 employees in November.
- 321 roles made redundant
- ⁠352 people have rejected their offer letters and taking severance.
So that means 65% of UK workforce will be gone.
They are fuc..ed run away...

[lhxperimental]

That's the Broadcom model - Acquire a company whose products have a big customer lock-in. Jack up the pricing by holding customers at gunpoint, make shitload of ransom money, use some of it for next acquisition. The idea is to quickly recover the acquisition cost, then make some more profit. After that you don't care even if the company shuts down. Imagine a bank is willing to lend you enough money to buy TSMC. You buy TSMC, jack up the prices, customers are going to be pissed but you just care about making a quick ROI, once you have earned enough to pay off the loan, you effectively got the company for free.

[MoraFermi]

VMware pricing has affected large businesses too. It's now cheaper to invest in completely new deployments, from renting new DC floor space to completely new compute/storage/networking just to get away from esxi faster.
P.S. OpenStack rules!

[warren_r]

I'm one of VMWare's first customers, going all the back to Workstation in 2000 and ESX in 2002. It has been baffling to me to see how badly VMWare has been mismanaged since the Dell acquisition. The day that they laid off the entire US / Canada development team was the day I pledged to never use their software ever again.

Glad I did, given everything that's going on now. What a train wreck.

[stevefxp]

I was a mainframe systems programmer until my boss asked me to transition and start up something called distributed systems. This was back in 1992. I became a CNE, eCNE, and MCSE by 1998. I then began working with VMware in 2004. My bank was VMware's first client to run production workloads on 1.0.

I have watched VMware transition itself, first to EMC and then to Dell and now to Broadcom. My homelab, up until last Friday, was ESXi 8. I have now fired up Proxmox 8.1 and trying to learn this new paradigm.

Broadcom is killing alot of business and I hope these organizations can come together and form consortiums that could license VMware...we shall see.

[IanHobday]

This is just one more reminder that the future is open source.

[Lovedbychrist]

I know people who worked (yes past tense) at VMware during the acquisition. It’s a blood bath over there, they have lost (laid off) most of their top support teams, engineers, and good staff. Anyone on VMware needs to run, and run fast.

[JohnBuckmaster]

They also removed all not-for-pofit/academic pricing. We're dropping to Standard or Essentials for this renewal, and switching to either Hyper=V or ProxMox. There's just not enough time to switch right now, or we would.

[talon]

The Goodfellas school of business: "F**k you, pay me."

[sarhtaq]

RiP VMWare, was fun knowing you.
(somewhere between 85 and 95% of companies I know serveradmins at, are all in the process of moving away from VMWare now)

Still shed a tear from Novell as well (last used it on V4.11, when it was still a viable system)

[johnkristian]

My business hasn't had a single support case ... what does we cost to service?! All I have done is buy licences. WELL THAT IS OVER NOW.

[cr-pol]

and let us not skip over how VMWare player has been degraded over the past 5 years.

[Barkebain]

I ran servers for a research university starting around 2000, and started deploying VMware in about 2004 with their free offerings. Eventually we purchased the enterprise version which was priced per socket. At the same time we were moving from 4 cores(no HT)/socket to 8(with HT), VMware changed their pricing to per core (I think it counted virtual cores too), so our cost was about to increase 1600%). We continued running what we had with less than 2 years until EOL. After much research, we went with Red Hat Virtualization, and migrated many hundreds of VMs over to the new cluster, and never looked back. When the university started using VMs for cs classes, they were deploying maybe tens of thousands of fresh VMs each semester, and had moved to 32 core AMD with SMT, and were saving several million/year over VMware licensing. There's a lot of competition in that market now, and VMware's greed will likely spawn direct competition at significantly lower prices.

[Dycell]

I was a VMWare technical consultant with a big reseller. I was there since Vsphere 2.5 but 7 years ago I just couldn’t explain the decisions they made to customers anymore. The whole memory tax and VCPU licensing was the tipping point for allot of customers. It was just too greedy by VMWare, especially with hyper-v and xenserver gaining ground. I stepped away from the entire product line and was convinced that it was entirely dead when Dell stepped in.

It sad to see such a beloved brand die.
But I also think the industry and especially the open-source products will highly benefit from this.
It’s also why I started doing allot more open-source so hopefully this will inspire other people as well.
The king is dead, long live the open-source king!