VMware platform an investment in users, Broadcom CEO says
CAMBRIDGE — About a month after proclaiming the public cloud has given IT teams post-traumatic stress disorder, Broadcom President and CEO Hock Tan is looking to bridge a communication and experience disconnect between users and VMware.
Broadcom’s acquisition of VMware was finalized last November, but customers remain confused as to how the change of ownership will affect their daily IT operations or budgets.
Tan, speaking during the morning keynote at the Boston VMware User Group (VMUG) UserCon Thursday, reiterated the message he delivered at VMware Explore in August — that VMware will focus on delivering a private cloud experience to customers’ on-premises workloads. But at the VMUG UserCon, he also clarified that the company wouldn’t abandon hybrid cloud connections with hyperscalers.
Purpose-built versions of VMware Cloud Foundation (VCF) for AWS, Microsoft Azure and Google Cloud Platform are in development, he said. Licenses for these versions will be available to customers with VCF licenses at no additional cost outside of existing per core pricing. This cloud license will also extend to cloud service providers such as IBM and Equinix, among other select partners.
“These three public clouds will run applications written in vSphere in their clouds directly,” Tan said, referring to VMware’s virtualization platform. “You don’t pay twice.”
He’s also prioritizing more opportunities for VMware users to acquire VCF licenses at a lower price point with complimentary training programs specifically targeting existing VMware professionals and advocates.
“We are very invested in ensuring you can help us drive this whole thing,” he said. “I shouldn’t be calling you the customer. You’re the partner.”
‘Captive audience’
But in some cases, customers aren’t seeing their relationship with VMware as a partnership.
Broadcom instituted licensing changes by collecting formerly separate software products into four bundled subscription services. VCF is the most expensive and feature-complete offering, while other bundles remove certain offerings such as NSX networking software to reach a lower price point.
These changes remain a frustration for VMware customers, with several UserCon attendees saying their organizations are a “captive audience” to whatever Broadcom institutes.
This perceived captivity stems from either their technology’s dependence on the VMware platform or from renewing their licensing agreements before they could re-evaluate options.
Tan’s not entirely wrong that customers are possibly looking to exit the public cloud and bring workloads back on premises to save money, said Kathleen Orben-Hall, senior systems engineer for Connection, an IT services provider in Merrimack, N.H. But the licensing changes to VMware might sink that private cloud ambition, she said, as customers consider alternatives to VMware.
“Customers are freaking out and trying to figure out how they’re going to move away,” she said. “We have a few customers just waiting [their licenses] out. It’s a mix of emotions right now.”
The decades of tight integration between VMware and other IT technologies means switching to other platforms would be a long and difficult challenge that likely results in fewer options for support and partner services.
William Cook, systems engineer at FirstLight Fiber, a fiber optics communications provider in Albany, N.Y., said his organization attended the conference to learn more about how the shift from discrete products to a VCF subscription would affect its core business.
“It’s not like we can just go down another path, but [the licensing change] did make us take a step back and start re-evaluating,” he said.
Broadcom bridge building
Despite Broadcom slimming the VMware catalog down to four subscription bundles, options and flexibility remain for VMware customers, according to Matt Heldstab, vice president of VMUG globally and an enterprise systems engineer at Minnesota State Colleges and Universities.
He said users should look at CPU utilization within servers, examine what subscriptions have the required services and work proactively with the account support teams to help drive down the subscription sticker shock. Buyers should also consider the prior initial licensing costs when buying software a la carte in the past compared with the flat subscription prices today, he said.
“Your milage may vary based on your [account] support team,” Heldstab said. “It’s hard to have a one-size fits all stance on what you’re going to see [from Broadcom].”
Despite some customers attempting hardball negotiation strategies, Heldstab said Tan is aware of customer concerns and remains open to speaking directly with users at VMUG events.
“He has told the board of directors [for VMUG to], ‘Let me know where you think you want me, and I will do the best I can to be there,'” he said. “He’s a fantastic person for VMUG, and we’re happy to have him.”
Tan also emphasized that VMware’s SMB customers haven’t been forgotten, as he’s looking to maintain and expand VCF adoption for this market as well as existing major customers.
“We started with our largest enterprises but we’re not discriminating,” Tan said. “We’re going all the way down.”
VMware’s internal IT systems were reorganized to provide a more cloud-like experience for its developers, Tan said, and he’s expecting to bring that same experience to customers with service catalogs and on-demand capabilities regardless of infrastructure.
Tim McCarthy is a news writer for TechTarget Editorial covering cloud and data storage.
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