Understand your options

Broadcom’s acquisition of VMware has significant commercial and technical implications for customers.

In addition to discontinuing perpetual licenses and introducing new bundled offerings, Broadcom has recently announced further changes that could prove financially challenging for many organisations.

• Effective 10 April 2025, the minimum number of cores a VMware customer can purchase will increase from 16 to 72.

• Customers who don’t renew their licenses by their anniversary date will pay a late renewal penalty of 20% of their first-year subscription.

While the impact of these changes are limited for VMware Cloud Foundation (VCF) customers, who generally use more than 72 cores for their private cloud environments, smaller customers using vSphere Foundation and vSphere Enterprise Plus for basic virtualisation services will be hit the hardest.

With renewal deadlines looming, organisations that rely on VMware’s virtualisation platforms need to take decisive action.

What’s at stake?

A lot has happened since Broadcom acquired the VMware portfolio. Broadcom’s introduction of new VMware bundled solutions meant many users saw their total costs rise due to the mandatory purchase of associated services – many of which they don’t need and won’t use.

Now the number of servers you deploy in your environment will increase your license cost. Added to which you must commit to an on-demand, 3-year or 5-year term.

With organisations reporting they are experiencing price hikes of between 3-10x, Broadcom’s new pricing model is placing significant pressure on already tight budgets.

So, how should organisations respond?

Step 1   Optimise your VMware environment

For many IT teams the next and least disruptive step is to stick with VMware, at least for the short term. However, that should not mean sitting back and doing nothing.

Now is the time to undertake a thorough and detailed assessment of your current VM estate and gather utilisation metrics for your VMware infrastructure. By performing a throughout review of your workloads and requirements you’ll be able to pinpoint the most appropriate VMware license for your needs – and avoid paying for products you don’t need.

Next, you’ll need to optimise and right size your VMware resources. By fine-tuning your existing infrastructure, you can potentially reduce the scale of the price increases you face. Can you turn off services you’re not using?

As part of this process, catalogue your current applications and management tools to determine, which, if any can be replaced or updated to operate with a different hypervisor.

Step 2   Keep your options open – evaluate alternative options

Forward thinking IT managers are now evaluating if they need to rethink their virtualisation strategy and transition to an alternative solution that will meet their long term goals.

The options potentially available include:

• Migrating to a cloud-based managed SaaS provider – such Oracle Cloud VMware, Azure VMware or Google Cloud VMware.
• Transition to an alternative hypervisor for on-premises virtualisation. There are lots to choose from, including Nutanix AHV, OpenStack, Hyper V and more.
• Containerisation options – like consolidating VM infrastructure on Kubernetes clusters.

Determining which path to choose means you’ll need to have a clear understanding of some key factors. That includes evaluating the technical viability and pricing structures of alternative platforms and the operational overheads associated with migration.

Step 3   Talk to Bell Integration

We know that switching to an alternative solution isn’t a decision to be taken lightly. Which is why our Discover & Optimise workshops are designed to support your long-term decision making and ensure that you get the maximum ROI from your existing VMware estate.

With Bell Integration you can:

• Optimise and right size your VMware infrastructure – ensuring you minimise the impact of Broadcom’s new licensing terms.
• Explore your options for re-platforming – understanding the barriers, performance, ROI and cost implications associated with each pathway.
• Determine the best way to deliver resilient, cost-effective and scalable business services by re-examining your product, portfolio and sourcing strategies.