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Company claims 1k% price hike drove it from VMware to open source rival
- fragmede 2y agoonly one?
- teruakohatu 2y agoDid Broadcom think the VMware moat was a lot deeper than it is? Or do they think losing small or medium customers is worth it to get 10x more revenue from its largest customers?
- kristopolous 2y agoI'm curious why anyone still uses the product. They had a clear advantage 20 years ago but that was 20 years ago. I really don't understand what distinguishing thing they offer these days.
- spockz 2y agoMaybe simply the moat? Integration with networks? What is the alternative? Xen? Proxmox?
- kristopolous 2y agoDepends on what you're doing I guess. https://en.wikipedia.org/wiki/Comparison_of_platform_virtualization_software https://en.wikipedia.org/wiki/Comparison_of_platform_virtual... there's a bunch vmware had this magic sauce that worked before hardware virtualization support was common. In around 2000, the only realistic options was either vmware or vm/esa on a mainframe. It hasn't been like that for a long, long time.
- linsomniac 2y ago>In around 2000, the only realistic options was either vmware Let's not forget user mode linux. :-) I ran hundreds of "VMs" using UML and it worked surprisingly well.
- spockz 2y agoThose are mostly alternatives for VM host/runtime/hypervisor. Not for the whole integrated eco system.
- ExoticPearTree 2y agoA lot of people use it. I for one use it because it is simple to manage, setting up shared storage is a breeze, live migration is super easy. I don't use any of the fancy NSX stuff and whatnot because I don't believe they add any value. I was looking at Proxmox, but I kind of got lost in the documentation when it comes to shared storage and high-availability, meaning restarting VMs on another host if one host fails. RedHat is just as expensive as VMware used to be, but it had less features, so it is not really an option.
- jve 2y ago> ..., meaning restarting VMs on another host if one host fails. Wait, your VM will still restart if vmware host dies, right? You can't have RAM sync between hosts.
- larvaetron 2y ago> You can't have RAM sync between hosts. That's what FT is for, if the primary VM instance dies or becomes unresponsive, you failover to the mirror instance.
- ExoticPearTree 2y agoThere are two different things: - live migration: its wonderful because I can update servers firmware without any VMs downtime - VM restart if a host dies - works wonders in a cluster where given enough host capacity you have a level of assurance that the downtime is very brief. And regarding Fault Tolerance, it is tricky and if you don't need that level of availability it's better to just plan for a VM restart or have other types of high-availability in place to mitigate a host failure.
- dralley 2y agoIf you're talking about OpenShift, it has less features for virtualization perhaps, but is easier for migrating apps over to k8s. Which is something many orgs want to do.
- jzb 2y agoIf a company has a significant amount of infra set up with VMware the costs of migration to another solution are substantial. They have to retrain staff, who may not be keen on relearning how to do what they already know how to do with VMware. They have to replace other solutions that work with VMware but maybe not a new alternative. And there’s usually features that VMware has that others do not, or they work differently enough that it introduces more friction. The core virtualization stuff is commodity, but there’s much more to it.
- WJW 2y agoNot having a clear advantage might be a good reason to not choose it for new products, but there are thousands of companies that chose VMware 20 years ago when it did have a clear advantage. You have to have a pretty good reason to invest thousands of people hours in a project to migrate to another plaform, and simply "it's not the latest product out there" is not often a compelling reason to throw out something that still works pretty well. Price increases as in the linked article can be a compelling reason, of course.
- garganzol 2y agoVMware was worth the money because it just worked and worked decently. I chose it in the past to avoid wasting my time on crashes, incompatibilities, and lacking performances that were typical for other VMs.
- ta1243 2y agoNobody got fired for buying IBM/Microsoft/Cisco/VMWare Inertia, both in a company and in the industry, is a major reason.
- prmoustache 2y agoA lot of people knows it very well. I wouldn't consider it for personal use but I didn't have a lot of issue managing vsphere clusters when I was still into it. Also it is not about the VMs only but the whole ecosystem. Last time I worked for a company where we considered moving out of vmware, the main issue was not migrating to a new VM management solution but having to migrate to a new VM hypervisors + migrating to a new backup solution supporting the new hypervisor. This while still maintaining original backup solution until retention runs out or we migrate and test all old backup with long retention. Or we had to decide on maintaining several backup systems in parallel which would increase the cost of backups. It is not just about migrating VMs.
- InsomniacL 2y agoBroadcom aren't charging 10x for the same thing. They are just not selling products individually anymore. If you previously only licensed a single product, your only option now is to buy everything under a single license. We are already using a lot of VMWare products, not only do we now have access to more, our overall price went down. I think medium sized customers have a choice, switch from their Broadcom products, or move more to Broadcom.
- technion 2y agoBroadcom kind of went against this though as it also divested itself of several parts of the vmware product range. A lot of what we used to see advertised alongside sphere isn't even a broadcom product now.
- Spooky23 2y agoThe latter. They have a threshold where they basically say IDNGAF. Above that, they’ll come to some terms.
- Clubber 2y agoI would guess they know it's dying and they're trying to get everything they can out of it while they can. Vendor lock-in is a real risk everyone should be cognizant of.
- williamdclt 2y ago> do they think losing small or medium customers is worth it to get 10x more revenue from its largest customers? they'd be almost certainly right to think that, of course it'd be worth it. The pending question is whether the largest customers will actually sticks with VMWare for them to actually see this 10x revenue materialise
- elzbardico 2y agoBroadcom is the typical MBA run company. Nobody fucking cares about the long run. The idea is to extract as much as much profit as possible right now, the executives pocket the bonuses, and when the well dries, they can just move to the next target. It is the locust economy.
- rwmj 2y agoWe (Red Hat) are doing great business moving customers off VMware. 20,000 VMs is not an unusual amount for our larger customers. I did a 5 min lightning talk in summer about this: https://pretalx.com/devconf-cz-2024/talk/SN93LG/ https://pretalx.com/devconf-cz-2024/talk/SN93LG/
- jhickok 2y agoLooks like that tool typically targets KVM as a source. My understanding is that Red Hat's own virtualization platform is transitioning from RHEV to OpenShift. If that is true, are you actively moving customers from vmware to OpenShift via Kubevirt?
- rwmj 2y agoUpstream, virt-v2v supports conversions from VMware to either oVirt (RHV) or KubeVirt (OSV), and we don't plan to drop the oVirt support any time soon. However Red Hat now only supports conversions to OSV, since RHV was deprecated (sadly). The biggest problem is oVirt itself has not proven to be a very sustainable open source project. If oVirt dies, we'll likely remove support in v2v. (There's a great start up opportunity here, for a dull but money-making company that productizes oVirt again.) To move VMs from RHV to OSV you can just copy the disk image since they already should have virtio drivers, qemu guest agent, and be able to boot on any qemu/KVM-based platform. I believe there's some automation for that, but it doesn't involve virt-v2v.
- jhickok 2y agoThank you for taking the time to explain. I was honestly a little shocked to hear about RH moving away from RHV, but glad to hear there is some interoperability between some of these tools.
- ghaff 2y agoThere never was a lot of interest in RHV as a like-to-like VMware alternative. But, when I left, there was quite a lot of interest (especially post-Broadcom acquisition) in a Kubernetes/cloud-native friendly VM alternative to VMware. And, yes, there are various migration tools though I was not involved in the details.
- difosfor 2y agoSo Broadcom is basically just milking VMware until it completely dies? I guess you should always consider the risk of a company buying a product you use and then doing this
- fragmede 2y agoYeah but how does it make any business sense for Broadcom to be doing this? They could have raised prices 100% and fewer people would flee and they'd make more money overall. 1,000% price raises are just plain extortion.
- RedShift1 2y agoBuy, extract as much money as possible, then dump the carcass. I'm sure they did the math on this.
- Y_Y 2y agoThis is the classic "golden goose" strategy. Why wait around all week for steady returns when you can just rip the thing open and see what you can get for the internal organs.
- ChrisRR 2y agoWhenever companies make moves that people don't like, the comments go on as if they haven't thought any of it through They knew they would lose customers, they've factored that into their business plan
- maltris 2y agoHaving been in the field for some time and having some contacts, I must say: 100% of the companies where I get some insights are currently either already building alternatives or reviewing their options with a strong intention to leave VMware behind. And in many cases this is quite a huge task, but certainly doable with the required momentum.
- BarryMilo 2y agoI'm in small Devops team and people are pissed off. Thankfully Proxmox works just as well for us (some would say better). Even a large-scale migration seems scriptable to me.
- Spivak 2y agoProxmox is a lovely piece of software, highly recommend to everyone. But I think Proxmox and vSphere target rather different scales of cluster. Proxmox starts to choke once your past 20 nodes or so. Corosync just wasn't designed for huge clusters. I think the price hikes have made the "medium" use-case more uncertain.
- BodyCulture 2y agoProxmox looks great, but unfortunately it doesn’t come with encryption oob and manually applying it comes with feature loss and other problems. ZFS vs encryption is a bad place to live. You of course need encryption for your VMs on the Enterprise.
- perlgeek 2y agoI work at an IT outsourcing company that also has some VMWare farms (though not sure if we reach 20k VMs). What I picked up is that before the acquisition, price was mostly determined by CPUs on the hypervisor, now it's mostly by RAM. Which means we now have to optimize hypervisor hardware to a different licensing model. I don't think we've seen 10x price hikes, but it could possible if a provider has optimized hard for a metric that is now less relevant, and/or has difference licensing deals. Caveat: I've picked all that up second-hand through the grapevine, I'm not working with our virtualization farms directly. So not 100% on top of what's going on.
- rwmj 2y agoIt's the Oracle pricing model. Turn the customer upside down and keep shaking until you've got all their money. They will dress this up in different ways to different customers, but that's the model.
- PcChip 2y ago> price was mostly determined by CPUs on the hypervisor, now it's mostly by RAM. I think you might have that backwards, before we paid based on ram and now we pay based on cores
- NitpickLawyer 2y ago> and now we pay based on cores Didn't even oracle drop this monstrosity of a licensing fee? Didn't microsoft also dropped / stoped pursuing it? How on earth do people justify this?
- udev4096 2y agoWhy not proxmox instead? I have never heard of OpenNebula before
- quantor_- 2y agoSeems to be focused on two different areas. This comparison [0] argues that proxmox is mainly focused on a centralized solution where as OpenNebula is focused on distributed setups [0] https://cylab.be/publications/64/download/2024-comparison-of-proxmox-and-opennebula-as-cyber-range-platforms.pdf https://cylab.be/publications/64/download/2024-comparison-of...
- udev4096 2y agoSo, their whole decision is based off of which VMM can support qcow import out of the box
- jeroenhd 2y agoBoth seem like excellent options for their use case. At that point, every small benefit helps make a decision. Even the support pricing doesn't seem too far off if you have a reasonably sized cluster. Both are projects with over a decade and a half of development behind it, both use similar virtualisation architectures, and both have easy to use web interfaces, with distributed storage options and cluster management tools.
- ErneX 2y agoOr xcp-ng + xen orchestra.
- udev4096 2y agoxcp-ng is far from stable and lacks significant features
- throw0101d 2y ago> Why not proxmox instead? I have never heard of OpenNebula before Different type of architecture. XCP-ng would also be a closer to fit to how VMware works as well. (I currently run Proxmox at work. At my last job we used OpenStack.)
- tablatom 2y agoOff topic but if I may. The way people use percentages to express multiples is confusing. A doubling is a 100% increase. So a 200% increase is 3x, and so on. Then at some point we forget about the +1 and 1000% is "10 times the sum it previously paid for software licenses". Just a pet peeve I guess : )
- cbm-vic-20 2y agoMy pet peeve goes in the opposite direction: the use of multiples and percentages greater than one to describe smaller numbers: "This is 3x smaller."
- abofh 2y ago333.33% this - drives me nuts.
- rapind 2y agoBut % “decrease” is just as bad as percent “increase” that OP is railing against. Whereas the inverse of 3x is (1/3)x and still far clearer (three times the size and one third the size). Meanwhile 3x “smaller” is the inverse of 3x “bigger”, not 300% “increase”, which is mathematically different. The adjectives break our brains. Much easier to comprehend if we don’t use them, using “the size” instead.
- atorodius 2y agoWell it depends if you mean increase or not. in the OP it could mean either („X% price hike“ could be interpreted as new price is X% of old price)
- stonemetal12 2y agoSwitching to a multiple doesn't change the confusion either. A 10x increase, is x + 10x in the same way a 1K% increase would be x + 10x.
- wccrawford 2y agoThe same kind of people that say "I'm not good at math" will fight to the death to say this the wrong way and not have to think about it, so it's a losing fight, unfortunately. Now, any time I see anything more than 100% for an increase, I assume the person doesn't know how to say it properly, and the vast majority of the time I'm correct. I certainly never make any decisions (including opinions) based on that information without doing the math myself.
- helsinkiandrew 2y agoBroadcoms policy seems to be to aim for the larger customers where a 10x price rise for a suite of products isn't an issue. Charging 10x the price to 10% of your customers isn't necessarily a bad strategy for a business. 6 months ago on HN: https://news.ycombinator.com/item?id=40452260 https://news.ycombinator.com/item?id=40452260 > Steve McDowell, chief analyst at NAND research, told The Register that VMware by Broadcom is “laser focused on high-revenue, high-margin business” and has priced its wares “just below the pain threshold for customers they care about.”
- onei 2y agoBut does it not make you more vulnerable to competitors? Losing one of your few big customers will hurt regardless, but it likely hurts less if you have a pool of SMBs to act as a buffer.
- HPsquared 2y agoIn the long term, sure. They might just be strip mining it.
- tvink 2y agoIn terms of competition it's really the same. Whether you fight with a team of 1 for 5 businesses or a team of 10 for 1 business that is 50x bigger, on average as long as you have equal competition in each segment you walk away with the same. But you get very different customers, for better or worse. A segment of a customer base is hardly a buffer, if you underserve them they will leave, and you will have wasted effort making an inclusive sales and support process to them.
- acdha 2y agoThat makes not losing those customers more critical: if you lose one of the 50 smaller businesses, your revenue is barely affected; if you lose that 50x whale, you’re out of a job especially given how hard it is to find another one of that size. This shows up especially in the context of hiring: for a generation, there have been a ton of people who learn VMware at businesses of all sizes and your large shop can reliably hire them. Shutting down smaller sales affects that directly and because the smaller places are going to do something else it means that the people who move up to a bigger place are going to have direct firsthand experience contradicting what the VMware sales people are saying about how risky it is not to use their software.
- garganzol 2y agoBroadcom seems to have a lacking understanding of a business of software. Which is a typical symptom of hardware companies, their brains wired differently.
- brianwawok 2y agoMilking people for millions is poor understanding?
- mnau 2y agoBroadcom paid $69bn. Revenue in 2023 was $13bn. Operating income $3.74 bn. Net Income $1.3 bn. I don't see a future where they can extract money they paid for, even with their practices. This is the first year. Everyone is working on migration. Next year? There will be experience, what works, what doesn't. Year after that? Even more, there will be experts with deep knowledge, tools, adapters ect. Once you have that, leverage is gone.
- InsomniacL 2y agoSo many people misunderstand what is actually happening. Broadcom aren't hiking the price 10x for everyone. If you previously used: - VMWare Vsphere - Cloudify Automation - CISCO ASI Software Defined Network - Splunk log collection - Nutanix Acropolis Distributed Storage - etc.. Then you're going to see you vSphere costs jump massively because you're only option to buy vSphere now also comes with: - VMWare Vsphere - VMWare Aria Automation - VMWare NSX Software Defined Network - VMWare Log Insight - VMWare vSan - etc.. So, if you're already heavily invested in VMWare, you might even see your costs reduce.
- fluoridation 2y agoFrom Broadcom's perspective, that seems to make even less sense than a simple price hike that lets them shed unprofitable customers. What's the point of doing that? Some kind of sales force optimization?
- alephnerd 2y ago> What's the point of doing that A sale isn't free. It requires time, headcount, and engineering+PM resources. At Broadcom size, you want to maximize sales to F1000 customers (the kind that can and will shell 7-8 figures in TCV) as that gives you the most bang for your buck from a SalesOps perspective. A major issue with VMWare was their sales team would chase logos at the expense of an optimal sale, so their account teams would give extreme discounts (70-80%) at barely above the margin in order to close deals.
- jppittma 2y agoWell, we're probably a F10 company and my project had to move off of our vmware environment because prices were too high. Even at enormous companies, these things matter, and there's still accounting for resources at the local level.
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- Neywiny 2y agoI only use it because VirtualBox was being slow and the 3D hardware acceleration wasn't working even when I think version 7 said it should. Switched to VMWare and it's been almost perfect.
- linsomniac 2y agoI know VMWare works great for a lot of people, but it was always just a thorn in my side. Almost a decade ago my small company moved from VMWare to ganeti, and we've been really happy with it. At the time we were running a SAN and the small VMWare Essentials license. But managing it with Windows was painful for me personally, and our HP SAN was kind of painful, every year like clockwork it would just stop processing until we had remote hands reboot it. And every year they'd tell us "Try this firmware" to shut us up for another year, until eventually the product reached EOL. We had been running ganeti in our dev/stg cluster for years at that point (and the python.org infrastructure was using it at that time as well), so I decided to transition us to local storage running VMWare and then to ganeti. Doing local RAID array monitoring on VMWare was quite painful at the time, maybe that's gotten better? I absolutely love that ganeti has such a good suite of command-line tools for operating. I have a small shell script that respins half our dev/stg infrastructure every other day. Our entire critical infrastructure is HA at the machine level, so we don't play around with anything like live VM moves, we just do offline moves. I used to do the drbd-based replication and live moves, but the doubling of disk writes and committed disc usage wasn't worth it for us. Proxmox is on my radar if we needed to move away from ganeti, but so far we are looking like we'll stick with ganeti.
- p_l 2y agoIs ganeti still alive? I remember it being a thing a decade+ ago, but haven't seen it mentioned much since.
- linsomniac 2y agoThe latest release is almost 3 years ago, but the repo has commits a month ago. So I guess it depends on your definition of "alive". As "stable" software, I'm fine with it not having a ton of active development. It's been a real workhorse for me, I've got it running on 2 clusters of 6 physical machines each (1.4TB total RAM, 50TB disc, each). ~6 years ago I went to a local Dell dog and pony show where someone at the next table was poo-pooing on "those greybeards that run Debian and ganeti" instead of VMWare. But, this shit works...
- bastloing 2y agoThere's no claim about it, it actually happened. Always amazed at companies that extort their customers because it might be too expensive to move off those products. I remember Computer Associates back in the 1980s and 1990s, that was their business model, buy out a company, fire all the engineers, and Jack up license fees. Rinse and repeat. I remember seeing them at unix expo at the javits center, they always gave out the best chachkis
- alexvitkov 2y agoPerfect opportunity to start transitioning from 20,000 VMs to the actual amount needed for most reasonable use cases - 0.
- glitchcrab 2y agoSounds like someone wants to go full no-code to me.
- alexvitkov 2y agoHonestly, if I have to choose between working on the codebase of the average enterprise VMWare client and dragging some boxes around in a "no-code platform", I'm taking the boxes.
- louka77 2y ago[flagged]
- milesward 2y agoSeen this dozens of times this year. This is policy from VMware/Broadcom.
- dan-robertson 2y agoIs https://www.theregister.com/2024/12/02/beeks_group_vmware_opennebula_migration/ https://www.theregister.com/2024/12/02/beeks_group_vmware_op... a better link to use? This article seems to just be a summary of it.
- eigenvalue 2y agoThis doesn’t surprise me. The customer in this case is in the hosting business. They are likely fairly expert at infrastructure and devops and are operating in a super competitive, commoditized, price-sensitive corner of the market. Broadcom probably always expected to churn customers like that. But they knew that for every customer like that, there would be 3 or more Fortune-500 type companies that don’t want to risk any disruption and have big IT budgets that they can divert into covering the increase if they have to. They might even make plans to gradually move away over a few year period, but if they are charging 10x more than before, the profit they make in the next couple years will more than make up for it.
- ubermonkey 2y agoWe're small, but we abandoned VMWare YEARS ago because (a) our size meant nothing they were doing that was interesting was interesting to us and (b) HyperV was plenty good enough and essentially free and (c) the licensing and support conversation every year even BEFORE Broadcom was just insane. I get it. Virtualization is a commodity now. They're trying to squeeze the last serious profits out of the platform, but in behaving this way they're absolutely hastening their own exit from the market. Good riddance.
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- zombot 2y agoSounds like Broadcom is engaging in some serious enshittification of VMWare. Customers leaving in droves is the appropriate reaction.