4 ms·

In the case of Broadcom they actively seek technologies that are extremely difficult to pull out of large organizations. Then they make their money back by gutt

by tw04 3y ago

In the case of Broadcom they actively seek technologies that are extremely difficult to pull out of large organizations. Then they make their money back by gutting all sales staff and r&d and jacking up prices for everything. They believe they can make their money back and then some off the Fortune 500 and they’ve bet correctly almost every time. Horrible way of doing business, not sure why it’s allowed, but it works. Just barely better than corporate raiders.

SahAssar 3y ago
Getting back a 69$ billion price tag that way seems optimistic, but maybe I'm just pessimistic about the cash to be gained by being entrenched in large corporations. Either way it does not feel like this strategy will open new lines of revenue for them.
- tw04 3y ago
  >Getting back a 69$ billion price tag that way seems optimistic, but maybe I'm just pessimistic about the cash to be gained by being entrenched in large corporations. VMware had $13B in revenue in 2023. I expect the average customer's cost to double over the next 24 months - so put that at $26B doing nothing beyond increasing costs (and forcing customers into a subscription with products they don't need or want). Then cut all sales staff, R&D, and gut support. They will have paid off their investment in under 5 years. That's not even including the sale of end-user compute which is predicted to go for $4b. >Either way it does not feel like this strategy will open new lines of revenue for them. I guess that depends on what you mean by "opening up new lines of revenue". It is already opening up a subscription line of revenue they have not had previously - they've dumped all perpetual vmware licenses and are forcing everyone to subscriptions. If you mean taking the VMware product and adding new features to increase the revenue stream of the existing customer base via an expanded product: of course not. They aren't interested in improving the product, they are interested in milking every last penny out of it at the lowest possible overhead. Why do you think the ink was barely dry on the deal and they already killed ESXi free edition, and all perpetual licenses?

by tw04 3y ago

SahAssar 3y ago

Getting back a 69$ billion price tag that way seems optimistic, but maybe I'm just pessimistic about the cash to be gained by being entrenched in large corporations. Either way it does not feel like this strategy will open new lines of revenue for them.

tw04 3y ago
>Getting back a 69$ billion price tag that way seems optimistic, but maybe I'm just pessimistic about the cash to be gained by being entrenched in large corporations. VMware had $13B in revenue in 2023. I expect the average customer's cost to double over the next 24 months - so put that at $26B doing nothing beyond increasing costs (and forcing customers into a subscription with products they don't need or want). Then cut all sales staff, R&D, and gut support. They will have paid off their investment in under 5 years. That's not even including the sale of end-user compute which is predicted to go for $4b. >Either way it does not feel like this strategy will open new lines of revenue for them. I guess that depends on what you mean by "opening up new lines of revenue". It is already opening up a subscription line of revenue they have not had previously - they've dumped all perpetual vmware licenses and are forcing everyone to subscriptions. If you mean taking the VMware product and adding new features to increase the revenue stream of the existing customer base via an expanded product: of course not. They aren't interested in improving the product, they are interested in milking every last penny out of it at the lowest possible overhead. Why do you think the ink was barely dry on the deal and they already killed ESXi free edition, and all perpetual licenses?