5 ms·

Did 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 l

Did 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 ago
I'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 ago
  Maybe simply the moat? Integration with networks? What is the alternative? Xen? Proxmox?
  - kristopolous 2y ago
    Depends 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 ago
      Those are mostly alternatives for VM host/runtime/hypervisor. Not for the whole integrated eco system.
- ExoticPearTree 2y ago
  A 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 ago
      There 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 ago
    If 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 ago
  If 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 ago
  Not 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 ago
  VMware 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 ago
  Nobody got fired for buying IBM/Microsoft/Cisco/VMWare Inertia, both in a company and in the industry, is a major reason.
- prmoustache 2y ago
  A 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 ago
Broadcom 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 ago
  Broadcom 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 ago
The latter. They have a threshold where they basically say IDNGAF. Above that, they’ll come to some terms.
Clubber 2y ago
I 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 ago
Broadcom 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.

Did 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 ago

I'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 ago
Maybe simply the moat? Integration with networks? What is the alternative? Xen? Proxmox?
- kristopolous 2y ago
  Depends 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 ago
    Those are mostly alternatives for VM host/runtime/hypervisor. Not for the whole integrated eco system.
ExoticPearTree 2y ago
A 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 ago
    There 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 ago
  If 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 ago
If 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 ago
Not 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 ago
VMware 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 ago
Nobody got fired for buying IBM/Microsoft/Cisco/VMWare Inertia, both in a company and in the industry, is a major reason.
prmoustache 2y ago
A 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 ago

Broadcom 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 ago
Broadcom 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 ago

The latter. They have a threshold where they basically say IDNGAF. Above that, they’ll come to some terms.

Clubber 2y ago

I 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 ago

Broadcom 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.