The Broadcom Effect

It’s been a wild ride in the virtualisation world over the past year. Since Broadcom completed its acquisition of VMware in November 2023, the ripple effects have been felt by just about every VMware customer on the planet. If you’re reading this blog, chances are you’ve been impacted, are worried about being impacted, or are fielding calls from people who are impacted. Let’s talk about it.

What Actually Changed

The headline changes are well documented at this point, but worth summarising. Broadcom has moved VMware to a subscription only licensing model, eliminating perpetual licenses. The product portfolio has been consolidated from a sprawling set of individual products down to a smaller number of bundled offerings. The VMware partner programme has been significantly restructured, with many long standing partners losing their ability to resell VMware solutions. And perhaps most consequentially for many, pricing has in numerous cases increased substantially.

In February 2024, Dell terminated its VMware resale agreement with Broadcom. This is worth pausing on, because Dell was the single largest VMware partner in the world. The fact that Dell made this decision tells you quite a lot about how the new Broadcom approach landed with the partner ecosystem. To be clear, Dell continues to support VxRail and VMware based solutions for existing customers, but the nature of the commercial relationship has fundamentally changed.

The Conversation Shift

In my conversations with customers and partners over the past six months, the tone has shifted from “we’re watching this closely” to “we need to actively plan for alternatives.” This doesn’t mean everyone is ripping and replacing VMware tomorrow, far from it. VMware remains an excellent virtualisation platform with deep ecosystem support. But what it does mean is that organisations who previously had VMware as the default, the only answer to the question of “where do we run our virtualised workloads”, are now actively evaluating alternatives as part of a broader infrastructure strategy.

This is, at its core, a multicloud conversation. For years, multicloud has been discussed primarily in the context of public cloud providers. Azure or AWS? GCP or Azure? The reality for most organisations though is that their most critical multicloud decision is between on-premises and public cloud, and within on-premises, which virtualisation platform to standardise on. The Broadcom acquisition has forced this conversation into the open in a way that nothing else has managed to over the past decade.

Where Does Azure Stack HCI Fit?

If you’ve been following this blog, you’ll know that Azure Stack HCI has evolved significantly over the past year. It’s no longer just a hyperconverged operating system, it’s a full hybrid cloud solution. The evolution from 22H2 to 23H2 was a step change in capability, and the platform continues to mature at pace.

For VMware customers evaluating alternatives, Azure Stack HCI presents a compelling option for several reasons:

First, the integration with Azure. If you’re already invested in Azure for public cloud workloads, the ability to extend that management plane, those policies, that tooling down to your on-premises infrastructure is genuinely powerful. Azure Arc provides the connective tissue, and Azure Stack HCI is the on-premises platform that makes it real.

Second, licensing simplicity. Azure Stack HCI’s licensing model is straightforward and predictable. You know what you’re paying, you know what you’re getting, and you’re not going to wake up one morning to find your costs have tripled.

Third, and this is where I’ll obviously put on my Dell hat, the Dell AX system delivers an integrated, validated, and continuously tested Azure Stack HCI experience. We’ve invested heavily in making the deployment, lifecycle management, and support experience as seamless as possible. This isn’t a box of parts that you have to figure out yourself, it’s a solution that’s engineered end to end.

A Word of Caution

I want to be measured here though, because the worst thing anyone can do is make a panicked infrastructure decision. If your VMware environment is running well, your licensing renewal isn’t imminent, and you have time to plan properly, then take that time. Evaluate your options thoroughly. Run a proper proof of concept. Understand the migration path, which we covered in a previous blog on migrating VMs to Azure Stack HCI .

The organisations who will come out of this period in the strongest position are those who use it as an opportunity to genuinely rethink their infrastructure strategy, not just swap one hypervisor for another, but think about what their hybrid cloud architecture should look like for the next five to ten years.

Looking Forward

The virtualisation market is more competitive and more interesting than it has been in over a decade. Azure Stack HCI, Nutanix, Proxmox, and others are all benefiting from the disruption that Broadcom has introduced to the market. Competition drives innovation, and that’s ultimately good for customers.

From a Dell perspective, we’re in a unique position. We have deep heritage across multiple virtualisation ecosystems, and we’re investing heavily in ensuring that customers have choice and flexibility regardless of which direction they choose. The Dell AX system for Azure Stack HCI is a key part of that investment, and I’m looking forward to diving deeper into what’s coming next in future posts.

In the meantime, if you’re in the middle of this evaluation, I’d encourage you to go back and read the earlier posts on this blog about what Azure Stack HCI is in 2024 , understanding the different VM types , and how migration works . They’ll give you a solid foundation for understanding what the platform can deliver today.