alt Hacker NewsWhy would you self sabotage such a considerable contract? Are Broadcom stupid?
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It does seem an odd move. No doubt they're going to milk existing customers for everything they're worth, but they're going to create a generation of people who will never buy anything from them ever again. That guy who's busting his balls to migrate off VMWare because of the price hike is gonna be the CTO in 10 years time, and when he's making that 10m USD purchasing decision they're gonna stay well away from anything with the name Broadcom on it.
From the followup article "Broadcom is laughing all the way to the bank"
>"Broadcom’s recent $1 trillion valuation is largely related to Broadcom’s expectations of AI"
Who needs paying customers when you have AI?
VMware is in its way out and they are milking every penny?
Evidence does tend to point that direction, yes. What they did to the VMware ecosystem is reprehensible
Broadcom expects every customer to move off VMware eventually due to technology shifts, by jacking up the price 10x and cutting costs 70% they can print money for a few years from customers that are either too risk-averse or too dysfunctional to switch to another product.
Possibly they’ll do enough brand damage that it turns out to be a negative ROI, but for now they’re printing money.
Honestly the writing was on the wall for the traditional VM business already. May as well squeeze out what you can where you can.
Apparently you've not read about Broadcom's well loved and respected CEO: Hock Tan. /s
I think it's a cultural thing over there. They came loaded for bear with their customers to convert them to the new ARR-based, non-perpetual product lineup.
I've negotiated a lot of contracts and renewals. I've been threatened twice - Oracle, and then Broadcom. We had perpetual licenses, but that didn't matter, according to them we were out of compliance and as a "courtesy" they delayed sending C&D as a precursor to suing us - this was the intro meeting call. There was no budging on price, and they actually priced the cheaper alternative we could have considered ("VVF") at like a 0.1% discount from their core "VCF" product, I think as a fuck-you. It was a great time, our reseller and I shared a drink over that one.