4 ms·

VMware migration reduces Tottenham Hotspur's licensing fees by 85 percent

104 points by joozio 1mo ago

unethical_ban 1mo ago
There is a 100% chance that someone in Broadcom exec team is making money shorting themselves. Or else some insider assurance that they'd get so much money from government or some big customer that they could run their products into the ground no matter what. But enterprises are not as locked in as people think.
- crote 1mo ago
  Broadcom has absolutely zero interest in the long-term future of VMware. Their only goal is to squeeze as much money out of it as possible before it goes bust. Let's say that VMware had a $10B revenue with a $9B operating cost. If 0.1% of their megacorp customers is responsible for 20% of that revenue while only being 1% of the support needs, then ditching the other 99.9% of customers reduces revenue to $2B while the operating cost can be reduced to $90M - increasing profit from $1B to $1.91B. Those huge customers are quite locked in, so you can squeeze them for a couple of years before they leave. They have their own in-house support teams, so you can cut all L1/L2 support people. You're killing the product, so you can cut all developers except a handful to patch CVEs. The smaller customers who are leaving are doing some after a massive price hike, so you get a nice one-time renewal bonus while they desperately try to move to alternatives. No need to do any shorting when you're generating massive profits for a couple of years. The plan when VMware is dead? Cut up its corpse in tiny parts, sell them off, buy another company, repeat the same strategy. As long as the total money they manage to extract from VMware is more than its acquisition cost, Broadcom has succeeded.
  - quickthrowman 1mo ago
    Unlike Hock Tan, you forgot to raise the prices 5-10x. Then your 0.1% of customers generating 20% of your revenue turn into 0.1% of your customers generating the same amount of revenue as 100% of customers were before with lower operating costs and thus higher margins.
    - crote 1mo ago
      I did not, that's the "you can squeeze them for a couple of years" part.
  - lokar 1mo ago
    Broadcom explained this all to investors at the time of the acquisition.
- datakan 1mo ago
  I didn't realize how addicted some orgs were to VMWare until Broadcom bought them and I witnessed zero people migrate to alternatives. It's been one of the single biggest shocks to me in my career. Watching them get squeezed openly and ruthlessly and just accepting it. I've only ever seen Microsoft pull that off before.
  - tacostakohashi 1mo ago
    I guess that means that VMWare are very skilled in calculating exactly how much they can hike the price / squeeze. Same with oracle, and all the other vendors that play this game. It kind of makes sense, if you're using VMWare, your choice is to pay a ridiculous but fixed/certain sum, or embark on a risky migration project that probably involves hiring a bunch of people, could take longer than expected, might fail, etc.
  - lokar 1mo ago
    They tend to be large complex enterprises outside tech. They don’t have the people (from the cto/cio down) to execute a migration well. They tend to have a very poor to mixed history with other tech migrations, and the risk here would be even higher.
  - Zigurd 1mo ago
    Some software companies sort of stumble into treating their customers as hostages while others make an art form of it. Computer Associates, which is part of Broadcom now, has been doing that for decades.
  - msh 1mo ago
    My workplace have had ibm support contracts from before Steve Jobs met Woz…
  - blincoln 1mo ago
    I'm not surprised that there's a lot of inertia. VMware Workstation has historically been the most "it just works" option if one needed solid USB passthrough support. I've bought my own license for about 15 years because of that. Obviously I won't be doing that anymore because I refuse to subscribe instead of buying a permanent license. I've been out of the infrastructure engineering space for a long time, but when that was still my career, vSphere was extremely reliable and easy to manage. When I've poked my head back in during pen tests since then, it's seemed like that was still the case. Feels like Broadcom wants to use the Microsoft/Oracle/Cisco business model. They'll probably get away with it (at least for awhile) in the enterprise space, but they seem to have reached the same conclusion as me - Workstation and Fusion don't have enough exclusive aspects to be make the consumer market worth pursuing.
- pjc50 1mo ago
  Note that execs are usually given stock grants in part to ensure they are long rather than short. But you'd not be making money shorting Broadcom (AVGO); they're up on the year and YTD. They're an "AI stock" now, doing custom silicon for AI companies, and that's all that matters. VMware is just going to be squeezed, rather than trying to acquire new customers. The entire corporate market is almost a rounding error compared to how big the datacenter boom is.
jbyers 1mo ago
This is good for Tottenham, we need that money: https://www.nytimes.com/athletic/7542593/2026/09/02/tottenham-transfer-window-de-zerbi-savio-fernandes-tonali-marmoush-mudryk/ https://www.nytimes.com/athletic/7542593/2026/09/02/tottenha... ($405M in gross transfer spend in this summer's window)
- alostpuppy 1mo ago
  How much do they spend on players overalls?
  - charlieyu1 1mo ago
    Too much for Championship.
happymellon 1mo ago
So I know that its VMWare, so the fees will be eyewatering, but 85% reduction is really meaningless in this story. How much was Tottenham using? Did the 85% actually cover the cost of their new CTO coming in and switching platforms? It's very vague.
- INTPenis 1mo ago
  Yeah it means nothing without details. They're a new HPE customer so they might be getting a discount the first year or something. A friend of mine is a virtualization SME and from what I can tell you don't really save that much on the alternatives. Also, HPE sell VMware. HPE has a modular solution where you can pick the hypervisor you want to use, including VMware. At my $dayjob we use Proxmox and it's good enough. I think Proxmox would be good enough for most orgs. But my friend works with the tax agency and they definitely make use of vSAN, NSX, and all those nice features that puts VMware above the competition.
- Brian_K_White 1mo ago
  To me it doesn't matter if it costs more or less to migrate. It's worth infinity to walk away from anyone who abuses you. It's also worth infinity to switch from anything proprietary to open source. The claimed advantages of whatever proprietary product never really exist. You always get more value by paying developers instead of paying rent. ...And tolerating license audits. It boggles my mind that people are willing to tolerate some douchebags from MS or anyone else to come in to your office and turn over every rock and look through all your books, and you PAY them for this!
  - happymellon 1mo ago
    I would agree. But that was not the story.
- siliconpotato 1mo ago
  And none of the quotes from that Pickering guy actually made any sense
- 9x39 1mo ago
Jean-Papoulos 1mo ago
“If [virtualization is] not built into a broader AI operation stack, the value is even lower again,” Pickering said. For the love of god keep Gen AI off of infrastructure...
rhipitr 1mo ago
85% reduction in VMware fees replaced by some other fees from something else? Or just an overall 85% reduction in cost?
nezhar 1mo ago
Reminds me of https://news.ycombinator.com/item?id=42682671 https://news.ycombinator.com/item?id=42682671
p0w3n3d 1mo ago
Go pricey get slicey!
gchamonlive 1mo ago
> Tottenham Hotspur (...) has saved over 85 percent in licensing fees by replacing (...) VMware instance with Hewlett-Packard Enterprise’s VME. So only a matter of time until they have to migrate again.
Zenul_Abidin 1mo ago
Still won't help them get out of a relegation fight.
- rajrahul 1mo ago
  Yes, much needed to survive in Championship next year.
bob1029 1mo ago
> The soccer organization confirmed this week to The Register that it has moved its stadium’s server, storage, and networking infrastructure to HPE solutions delivered through HPE’s hybrid cloud management platform, GreenLake. This is just a much worse version of AWS. Obsession with maintaining some degree of physical control over infrastructure drives many organizations to absolute insanity. Skip the hybrid nonsense. Find a CTO with some balls.
- surgical_fire 1mo ago
  I would argue that absolute insanity is surrendering all control of infrastructure to cloud providers. Especially when you are using managed services that lock you in, making any plans of migrating way ridiculously painful. It takes a CTO with cojones to actually own your infrastructure.
- deadbunny 1mo ago
  Takes real balls to go with AWS huh?
  - geodel 1mo ago
    I mean wasn't it just few months back when Socrates was asked to drink poison chalice when he was promoting multi-cloud strategy by using Kubernetes based deployment for his education platform.
- WokeUp420 1mo ago
  Nonsense. Renting servers is the easiest way to bankrupt your company. Look at all the capacity shortages going on right now. Price will continue to outpace bare metal and controls will get tighter. Not to mention there are many scenarios where cloud connectivity is not an option.
  - bob1029 1mo ago
    > Renting servers is the easiest way to bankrupt your company. I can think of a lot of easier ways.
celsoazevedo 1mo ago
Tesco, a large supermarket chain (also in the UK), is also moving away from VMware: https://arstechnica.com/information-technology/2026/06/tesco-moving-40000-server-workloads-off-vmware-amid-broadcoms-abusive-conduct/ https://arstechnica.com/information-technology/2026/06/tesco... I'm assuming they're paying much more than a football club. There's also a legal side in this case because they're actually suing Broadcom: "Tesco claimed Broadcom hiked its VMware prices by about 175 percent in UK court filings."
- WokeUp420 1mo ago
  Kroger has moved to SUSE and Azure Local
  - _joel 1mo ago
    "# Kroger, they put plastic, in your steaks" Ordinary Sausage
- kotaKat 1mo ago
  Curious what Tesco was going to go to, considering most of the old Retalix/NCR WinPOS/ISS45 stack was heavily Windows-reliant underneath it. I assume Azure or Hyper-V of some sort?
crazyjunkie001 1mo ago
[flagged]
Betelbuddy 1mo ago
[dead]

104 points by joozio 1mo ago

There is a 100% chance that someone in Broadcom exec team is making money shorting themselves. Or else some insider assurance that they'd get so much money from government or some big customer that they could run their products into the ground no matter what. But enterprises are not as locked in as people think.

crote 1mo ago
Broadcom has absolutely zero interest in the long-term future of VMware. Their only goal is to squeeze as much money out of it as possible before it goes bust. Let's say that VMware had a $10B revenue with a $9B operating cost. If 0.1% of their megacorp customers is responsible for 20% of that revenue while only being 1% of the support needs, then ditching the other 99.9% of customers reduces revenue to $2B while the operating cost can be reduced to $90M - increasing profit from $1B to $1.91B. Those huge customers are quite locked in, so you can squeeze them for a couple of years before they leave. They have their own in-house support teams, so you can cut all L1/L2 support people. You're killing the product, so you can cut all developers except a handful to patch CVEs. The smaller customers who are leaving are doing some after a massive price hike, so you get a nice one-time renewal bonus while they desperately try to move to alternatives. No need to do any shorting when you're generating massive profits for a couple of years. The plan when VMware is dead? Cut up its corpse in tiny parts, sell them off, buy another company, repeat the same strategy. As long as the total money they manage to extract from VMware is more than its acquisition cost, Broadcom has succeeded.
- quickthrowman 1mo ago
  Unlike Hock Tan, you forgot to raise the prices 5-10x. Then your 0.1% of customers generating 20% of your revenue turn into 0.1% of your customers generating the same amount of revenue as 100% of customers were before with lower operating costs and thus higher margins.
  - crote 1mo ago
    I did not, that's the "you can squeeze them for a couple of years" part.
- lokar 1mo ago
  Broadcom explained this all to investors at the time of the acquisition.
datakan 1mo ago
I didn't realize how addicted some orgs were to VMWare until Broadcom bought them and I witnessed zero people migrate to alternatives. It's been one of the single biggest shocks to me in my career. Watching them get squeezed openly and ruthlessly and just accepting it. I've only ever seen Microsoft pull that off before.
- tacostakohashi 1mo ago
  I guess that means that VMWare are very skilled in calculating exactly how much they can hike the price / squeeze. Same with oracle, and all the other vendors that play this game. It kind of makes sense, if you're using VMWare, your choice is to pay a ridiculous but fixed/certain sum, or embark on a risky migration project that probably involves hiring a bunch of people, could take longer than expected, might fail, etc.
- lokar 1mo ago
  They tend to be large complex enterprises outside tech. They don’t have the people (from the cto/cio down) to execute a migration well. They tend to have a very poor to mixed history with other tech migrations, and the risk here would be even higher.
- Zigurd 1mo ago
  Some software companies sort of stumble into treating their customers as hostages while others make an art form of it. Computer Associates, which is part of Broadcom now, has been doing that for decades.
- msh 1mo ago
  My workplace have had ibm support contracts from before Steve Jobs met Woz…
- blincoln 1mo ago
  I'm not surprised that there's a lot of inertia. VMware Workstation has historically been the most "it just works" option if one needed solid USB passthrough support. I've bought my own license for about 15 years because of that. Obviously I won't be doing that anymore because I refuse to subscribe instead of buying a permanent license. I've been out of the infrastructure engineering space for a long time, but when that was still my career, vSphere was extremely reliable and easy to manage. When I've poked my head back in during pen tests since then, it's seemed like that was still the case. Feels like Broadcom wants to use the Microsoft/Oracle/Cisco business model. They'll probably get away with it (at least for awhile) in the enterprise space, but they seem to have reached the same conclusion as me - Workstation and Fusion don't have enough exclusive aspects to be make the consumer market worth pursuing.
pjc50 1mo ago
Note that execs are usually given stock grants in part to ensure they are long rather than short. But you'd not be making money shorting Broadcom (AVGO); they're up on the year and YTD. They're an "AI stock" now, doing custom silicon for AI companies, and that's all that matters. VMware is just going to be squeezed, rather than trying to acquire new customers. The entire corporate market is almost a rounding error compared to how big the datacenter boom is.

jbyers 1mo ago

This is good for Tottenham, we need that money: https://www.nytimes.com/athletic/7542593/2026/09/02/tottenham-transfer-window-de-zerbi-savio-fernandes-tonali-marmoush-mudryk/ https://www.nytimes.com/athletic/7542593/2026/09/02/tottenha... ($405M in gross transfer spend in this summer's window)

alostpuppy 1mo ago
How much do they spend on players overalls?
- charlieyu1 1mo ago
  Too much for Championship.

happymellon 1mo ago

So I know that its VMWare, so the fees will be eyewatering, but 85% reduction is really meaningless in this story. How much was Tottenham using? Did the 85% actually cover the cost of their new CTO coming in and switching platforms? It's very vague.

INTPenis 1mo ago
Yeah it means nothing without details. They're a new HPE customer so they might be getting a discount the first year or something. A friend of mine is a virtualization SME and from what I can tell you don't really save that much on the alternatives. Also, HPE sell VMware. HPE has a modular solution where you can pick the hypervisor you want to use, including VMware. At my $dayjob we use Proxmox and it's good enough. I think Proxmox would be good enough for most orgs. But my friend works with the tax agency and they definitely make use of vSAN, NSX, and all those nice features that puts VMware above the competition.
Brian_K_White 1mo ago
To me it doesn't matter if it costs more or less to migrate. It's worth infinity to walk away from anyone who abuses you. It's also worth infinity to switch from anything proprietary to open source. The claimed advantages of whatever proprietary product never really exist. You always get more value by paying developers instead of paying rent. ...And tolerating license audits. It boggles my mind that people are willing to tolerate some douchebags from MS or anyone else to come in to your office and turn over every rock and look through all your books, and you PAY them for this!
- happymellon 1mo ago
  I would agree. But that was not the story.
siliconpotato 1mo ago
And none of the quotes from that Pickering guy actually made any sense
9x39 1mo ago

Jean-Papoulos 1mo ago

“If [virtualization is] not built into a broader AI operation stack, the value is even lower again,” Pickering said. For the love of god keep Gen AI off of infrastructure...

rhipitr 1mo ago

85% reduction in VMware fees replaced by some other fees from something else? Or just an overall 85% reduction in cost?

nezhar 1mo ago

Reminds me of https://news.ycombinator.com/item?id=42682671 https://news.ycombinator.com/item?id=42682671

p0w3n3d 1mo ago

Go pricey get slicey!

gchamonlive 1mo ago

> Tottenham Hotspur (...) has saved over 85 percent in licensing fees by replacing (...) VMware instance with Hewlett-Packard Enterprise’s VME. So only a matter of time until they have to migrate again.

Zenul_Abidin 1mo ago

Still won't help them get out of a relegation fight.

rajrahul 1mo ago
Yes, much needed to survive in Championship next year.

bob1029 1mo ago

> The soccer organization confirmed this week to The Register that it has moved its stadium’s server, storage, and networking infrastructure to HPE solutions delivered through HPE’s hybrid cloud management platform, GreenLake. This is just a much worse version of AWS. Obsession with maintaining some degree of physical control over infrastructure drives many organizations to absolute insanity. Skip the hybrid nonsense. Find a CTO with some balls.

surgical_fire 1mo ago
I would argue that absolute insanity is surrendering all control of infrastructure to cloud providers. Especially when you are using managed services that lock you in, making any plans of migrating way ridiculously painful. It takes a CTO with cojones to actually own your infrastructure.
deadbunny 1mo ago
Takes real balls to go with AWS huh?
- geodel 1mo ago
  I mean wasn't it just few months back when Socrates was asked to drink poison chalice when he was promoting multi-cloud strategy by using Kubernetes based deployment for his education platform.
WokeUp420 1mo ago
Nonsense. Renting servers is the easiest way to bankrupt your company. Look at all the capacity shortages going on right now. Price will continue to outpace bare metal and controls will get tighter. Not to mention there are many scenarios where cloud connectivity is not an option.
- bob1029 1mo ago
  > Renting servers is the easiest way to bankrupt your company. I can think of a lot of easier ways.

celsoazevedo 1mo ago

Tesco, a large supermarket chain (also in the UK), is also moving away from VMware: https://arstechnica.com/information-technology/2026/06/tesco-moving-40000-server-workloads-off-vmware-amid-broadcoms-abusive-conduct/ https://arstechnica.com/information-technology/2026/06/tesco... I'm assuming they're paying much more than a football club. There's also a legal side in this case because they're actually suing Broadcom: "Tesco claimed Broadcom hiked its VMware prices by about 175 percent in UK court filings."

WokeUp420 1mo ago
Kroger has moved to SUSE and Azure Local
- _joel 1mo ago
  "# Kroger, they put plastic, in your steaks" Ordinary Sausage
kotaKat 1mo ago
Curious what Tesco was going to go to, considering most of the old Retalix/NCR WinPOS/ISS45 stack was heavily Windows-reliant underneath it. I assume Azure or Hyper-V of some sort?

crazyjunkie001 1mo ago

[flagged]

Betelbuddy 1mo ago

[dead]