The $69B bet against replacement

Let’s dig into the mindset behind the VMware price increases that have been happening since Broadcom acquired the company in 2023. SHOW: 808 CLOUD NEWS OF THE WEEK - http://bit.ly/cloudcast-cnotw CHECK OUT OUR NEW PODCAST - "CLOUDCAST BASICS" SHOW SPONSORS: Want to win a Tesla Cybertruck or $100,000? Enter the WS02 Choreo Code Challenge (before April 30th) WSO2 Choreo - Why build a platform? Just add developers instead SHOW NOTES: What VMware might look like under Broadcom (Eps.629, June 2022) What to do about VMware (Day Two Cloud, Feb 2024) VMware 10X Price Increase Leaves Companies Looking for Alternatives VMware pricing in the Broadcom Era BROADCOM IS FITTING VMWARE INTO THEIR BUSINESS MODEL At least with acquisitions, Broadcom has a well-defined set of business metrics they expect from their companies Broadcom acts somewhere like private equity in terms of investment, innovation, revenue generation IT'S A BOLD STRATEGY BROADCOM, LET’S SEE IF IT PAYS OFF FOR THEM In essence, the bet is that there is no replacement for VMware in the Enterprise The timing is interesting with the shifting of budgets for AI projects It puts customers in a position to pay more for limited upside, but having to distinctly cut other areas of their technology budget (risk the business) Customers have some options, but again they risk the business (e.g. hold off on security patches) Once a company accepts the new pricing, what guarantees are there about no additional big increases in the future? How much will this impact the longer-term vendor-customer relationship? FEEDBACK? Email: show at the cloudcast dot net Twitter: @cloudcastpod Instagram: @cloudcastpod TikTok: @cloudcastpod FEEDBACK? Email: show @ the enterprise ai show dot com Bluesky: @TheEntAIShow.bsky.social Twitter/X: @TheEntAIShow Instagram: @TheEntAIShow