Extreme VMware Price Increase: AT&T Details Broadcom's Proposed Changes

Luna Greco

3 min read

Post on May 13, 2025

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Significant Price Increases Across VMware's Product Portfolio

Broadcom's proposed changes represent a significant increase in VMware licensing costs across its product portfolio. Businesses are facing substantial price hikes affecting core products like vSphere, vSAN, NSX, and VMware Cloud Foundation. These increases are not incremental; they represent a dramatic shift in VMware pricing that could severely impact budgets.

• VMware vSphere Pricing: Reports suggest increases ranging from 20% to 40%, significantly impacting the core virtualization layer for many organizations.
• VMware vSAN Pricing: Similar substantial increases are expected for vSAN, VMware's software-defined storage solution, making storage costs a major concern.
• VMware NSX Pricing: The networking virtualization component, NSX, is also experiencing significant price increases, potentially adding considerable expense to network infrastructure management.
• VMware Cloud Foundation Pricing: This integrated platform, combining compute, storage, and networking, is also facing substantial price hikes, impacting companies leveraging hybrid and multi-cloud strategies.

For example, a medium-sized company currently spending $100,000 annually on VMware licensing could see its costs jump by $20,000 to $40,000 or more, depending on their specific product mix. This financial burden is particularly concerning for smaller businesses and startups, potentially hindering growth and innovation.

AT&T's Public Disclosure and its Implications

AT&T's public disclosure of Broadcom's proposed VMware price increases is a pivotal moment. Their statement highlights the magnitude of these changes and raises important questions about transparency and the potential anti-competitive implications of the acquisition. This move has brought the issue into the public spotlight, potentially influencing regulatory scrutiny and public opinion.

• AT&T's Statement: AT&T publicly voiced their concerns about the substantial price increases, indicating their dissatisfaction with the terms proposed by Broadcom post-acquisition.
• Negotiation Impact: AT&T's public stance could strengthen the negotiating position of other large enterprise customers facing similar price hikes.
• Potential Legal Implications: The transparency of the price increases may lead to increased regulatory scrutiny of the Broadcom acquisition, potentially triggering investigations into anti-competitive practices.

Potential Strategies for Businesses Facing VMware Price Increases

Facing these extreme VMware price increases requires proactive strategies. Businesses need to evaluate their options carefully, considering cost optimization, exploring alternatives, and potentially migrating to different platforms.

• Negotiating VMware Licensing Agreements: Companies should aggressively negotiate with VMware, leveraging their market position and the public attention surrounding the price hikes to secure more favorable terms.
• Alternative Virtualization Technologies: Exploring open-source alternatives like Proxmox VE or OpenStack can provide cost-effective solutions, albeit with a potential learning curve.
• Cloud Migration: Migrating workloads to cloud providers like AWS, Azure, or Google Cloud Platform could offer cost savings and scalability, but this requires careful planning and execution. A comprehensive cost-benefit analysis is crucial.
• VMware Cost Reduction Strategies: Internal optimization strategies, such as right-sizing virtual machines and optimizing resource utilization, can help control costs within the existing VMware environment.

Conclusion

The extreme VMware price increase following Broadcom's acquisition represents a significant challenge for businesses worldwide. AT&T's public disclosure has brought this issue to the forefront, highlighting the potential for increased scrutiny and the significant financial burden placed on companies reliant on VMware products. To mitigate the impact, businesses must proactively evaluate their VMware licensing agreements, explore alternative virtualization solutions, and implement cost-optimization strategies. Share your experiences and concerns about the extreme VMware price increase; collective action and open discussion are crucial in navigating this challenging landscape. Don't let the extreme VMware price increase cripple your business – take action today.