from Hacker News

Can confirm a current Broadcom VMware customer went from $8M renewal to $100M

by LLcolD on 2/26/24, 10:11 AM with 129 comments

  • by alephnerd on 2/26/24, 10:35 AM

    This is basically a polite way to fire a customer.

    You don't want to sell to everyone - you need to make sure the cost of retention+support is significantly less than what they are paying.

    If a customer is too troublesome or spending too little (for a company like VMWare, a $8m contract is on the smaller end) this is the politest way to fire them.

    It sounds like this customer is a legal firm, which makes sense - they tend to have a much smaller IT footprint.

    Every dollar isn't the same.

    Edit: to elaborate - it's all about margins. Is that $8m worth it if in aggregate you spending an equal amount of time on that account as you are on a $20-30m account? It ain't

  • by jve on 2/26/24, 11:07 AM

    And who can confirm this random guy on twitter? The followup tweet doesn't seem serious: https://twitter.com/cioontherun/status/1760862002941927622

    > Just emailed the CEO of Broadcom and got his OoO: “Thank you for your email. The exorbitant price increases are due to inflation and macroeconomic conditions. Also, the taxes on my mansion in Cabo are sky high!”

    Not that VMWare customers aren't faced with challenging circumstances...

  • by chgs on 2/26/24, 10:29 AM

    You choose proprietary and you get screwed.

    I can’t wait for the AWS sob stories.

  • by nubinetwork on 2/26/24, 10:42 AM

    FWIW, at $dayjob we switched from VMware to nutanix a couple years ago. I guess we got out at the right time...

  • by nodeman7 on 2/26/24, 10:28 AM

    Cant wait to watch VMware die a slow death

  • by hnthrowaway0328 on 2/26/24, 10:30 AM

    I guess no way there are going to pay that many. Maybe a huge discount and they are looking for a way out in a year or so?

  • by panick21_ on 2/26/24, 12:54 PM

    Does VMWare software do much more then VM handling? Is there something extra they provide to make it worth paying that much? I have only ever worked a little with the free product.

    Also, what are the alternatives proprietary and open? And what are those solutions missing? Hopefully this is good news for the open project, getting more commercial support and more users.

    Also sounds like good news for people like Oxide. If costumers are already considering leaving VMWare and need to do a lot of software changes, they might be willing to make a larger step for new hardware as well.

  • by nojvek on 2/27/24, 2:36 AM

    Not quite VMware but we switched from Algolia to Typesense.

    Algolia overage charges are a fortune. If we kept on going we’d be burning an equivalent software engineer worth of salary.

    Now we give equivalent sum to a real human.

  • by aimonster2 on 2/26/24, 2:56 PM

    This makes me terrified to use Broadcom owned products going forward.

  • by egberts1 on 2/26/24, 11:38 AM

  • by rwmj on 2/26/24, 11:33 AM

    I get that this is a deliberate strategy by Broadcom, but can someone explain how the strategy makes any sense? Broadcom apparently spent $69 billion to acquire VMware, so how does setting it on fire make sense financially?

  • by ashildr on 2/26/24, 7:42 PM

    Interesting bet. From now on no one in their right mind will BEGIN using VMware. Whatever new companies will be founded, none of them will choose VMware, neither will growing companies switch to VMware.

  • by gmerc on 2/26/24, 11:29 AM

    If only they’re were other hypervisors

  • by albert_e on 2/26/24, 10:46 AM

    Is AWS Workspaces and similar offerings on Azure a direct replacement for some of these VDI workloads

  • by amelius on 2/26/24, 10:52 AM

    How much would it cost to build VMware from scratch?

  • by brador on 2/26/24, 2:37 PM

    What’s the word he alludes to in the tweet?

  • by thriftwy on 2/26/24, 10:27 AM

    That does sound line a Unity moment. I wonder if the execs really learn nothing, or they enjoy conjuring competition out of thin air.

  • by fifteen1506 on 2/26/24, 10:26 AM

    The market at work, why the rage?

    They paid, didn't they?