VMWare’s new licensing policy doesn’t just make people happy. At the end of 2023, the market-leading virtualization solution publisher announced a significant change in its economic model: the company intends to move to a subscription model and end the licenses offered for its products.
As part of this development, VMWare has therefore evolved its offering and its prices for access to its products. The pill is simply not really going down well with users: in a column published on Tuesday, the CISPE, an organization which brings together the main European providers of hosting and cloud services, denounces the “new contractual conditions and sudden and unjustified price increases” practiced by the publisher.
They call on regulatory authorities and judicial powers to investigate these new pricing policies, recalling the essential role of VMWare products for many companies in the sector. “Several CISPE members have stated that without the ability to license and use VMware products, they would quickly go bankrupt and go out of business. Some claim that more than 75% of their revenue depends on VMware software virtualization technologies ” alerts the organization in its press release.
Forced evolution
Faced with this discontent which has been felt for several months, Hock Tan, director of VMWare, had already published a blog post on Thursday March 14 recognizing “a certain discomfort” among the company’s customers in the face of these changes. But the manager assures: “All these measures aim to innovate more quickly, respond more effectively to the needs of our customers and facilitate our commercial relations. We also hope that these changes will bring greater profitability and better market opportunities to our partners.”
A development that is obviously a little too rapid for customers, who deplore, as the CISPE press release highlights, “hundreds of products deleted without warning, and other products offered through new offers” without technical developments justifying the new price scales applied. by the publisher. In December 2023, VMWare, for example, ended its partnership program, replaced by a new Broadcom Advantage program accessible only by invitation and reserved for players achieving a certain quota of revenue with VMWare, as reported by the Distributique media at the time.
This new contested pricing policy follows the acquisition of VMWare by Broadcom, a merger announced in 2022 and finalized in November 2023. A acquisition which, from its initial announcement, had provoked an outcry from DSI organizations such as Cigref, who was worried at the time about a possible “drift in practices” by recalling Broadcom’s history in terms of acquisitions.