Broadcom, a global leader in semiconductors and software, faces client dissatisfaction over significant changes to VMware's licensing model following its acquisition.
VMware Purchase and AI Integration
In 2023, Broadcom acquired VMware for $69 billion, offering clients thousands of products to manage data centers. Broadcom then reduced these to five products. Hock Tan, Broadcom’s CEO, initially planned to lower the count to four, but client resistance led to the addition of a fifth product.
Broadcom Customers Push Back
Broadcom assures investors of increased earnings, surpassing the expected $8.5 billion. However, client organizations, particularly in Europe, have expressed concerns over their ability to control and own data amid the new licensing model.
Reaction to Licensing Policy Changes
Customers pushed back against Broadcom's new policies, especially in 2024 when AT&T accused Broadcom of forcing costly subscriptions. Nevertheless, the parties resolved the issue amicably.
The changes to VMware's licensing policy have sparked discontent among Broadcom's customers, highlighting the importance of considering their feedback when implementing such significant alterations.
