By Krish Prasad, Senior Vice President and General Manager, VMware Cloud Foundation Division
Broadcom’s close of the VMware acquisition has brought together two engineering-first, innovation-centric teams to help build the world's leading infrastructure technology company. Together, we are well-positioned to enable global enterprises to embrace private, hybrid and multi-cloud environments. And we are committed to driving customer success through faster innovation, a simpler portfolio and a robust ecosystem.
Over the past two years, VMware has been on a journey to simplify its portfolio and transition from a perpetual to a subscription model to better serve customers with continuous innovation, faster time to value, and predictable investments.
Today, VMware by Broadcom has reached a new milestone with the announcement of the following:
- A dramatic simplification of our product portfolio that allows customers of all sizes to gain more value for their investments in VMware solutions. The portfolio simplification across all VMware by Broadcom divisions stems from customer and partner feedback over the years telling us our offers and go-to-market are too complex.
- Complete the transition of all VMware by Broadcom solutions to subscription licenses, with the end of sale of perpetual licenses, Support and Subscription (SnS) renewals for perpetual offerings, and hybrid purchase program/subscription purchase program (HPP/SPP) credits beginning today (effective dates will vary). Additionally, we are introducing a bring-your-own-subscription license option, providing license portability to VMware validated hybrid cloud endpoints running VMware Cloud Foundation.
Portfolio Simplification
Today, we’re announcing specific changes coming to the VMware Cloud Foundation division portfolio. Going forward, the division will feature two primary offers:
- VMware Cloud Foundation, our flagship enterprise-class hybrid cloud solution for customers to run their business critical and modern applications – in a secure, resilient and cost efficient manner. To allow more customers to benefit from this solution, we’ve reduced the previous subscription list price by half and added higher support service levels including enhanced support for activating the solution and lifecycle management.
- The new VMware vSphere Foundation delivers a more simplified enterprise-grade workload platform for our mid-sized to smaller customers. This solution integrates vSphere with our intelligent operations management to provide the best performance, availability, and efficiency with greater visibility and insights.
Both VMware Cloud Foundation and VMware vSphere Foundation will have optional advanced add-on offers. Our storage offering, ransomware and disaster recovery service, and application platform services are available on both offers. And Application Network and Security offerings are available for VMware Cloud Foundation. Additional advanced services and offerings, including Private AI, will be available soon.
Subscription Licenses
VMware has been on a journey to transition to a subscription model for more than a year now, and the industry has already embraced subscription as the standard for cloud consumption. With a simplified portfolio in place, we’re completing our transition to subscription offerings. Offerings will solely be available as subscriptions or as term licenses following the end of sale of perpetual licenses and Support and Subscription (SnS) renewals beginning today.
The subscription model helps us deliver what customers want:
- Continuous innovation.
- Faster time to value.
- Predictable investments.
Customers may continue using perpetual licenses with active support contracts. We will continue to provide support as defined in contractual commitments. We encourage customers to review their inventory of perpetual licenses, including Support Services renewal and expiration dates. Broadcom will work with customers to help them “trade in” their perpetual products in exchange for the new subscription products, with upgrade pricing incentives. (For additional details, see FAQ).
The simplification of our portfolio and shift to subscription and term offerings are a culmination of our multi-year business transformation efforts. The steps we’re taking today will further enable customer and partner success by delivering the innovation, simplicity and flexibility they need as they undertake their digital transformations.
Frequently Asked Questions
Q: What is VMware by Broadcom announcing?
A: Today, VMware by Broadcom has reached a new milestone in its journey and announced the following:
- A dramatic simplification of our product portfolio that allows customers of all sizes to gain more value for their investments in VMware solutions. The portfolio simplification across all VMware by Broadcom divisions stems from customer and partner feedback over the years telling us our offers and go-to-market are too complex.
- Complete the transition of all VMware by Broadcom solutions to subscription licenses, with the end of sale of perpetual licenses, Support and Subscription (SnS) renewals for perpetual offerings, and HPP/SPP (generic) credits beginning today. Additionally, we are introducing a bring-your-own-subscription license option, providing license portability to VMware validated hybrid cloud endpoints running VMware Cloud Foundation.
Q: How do these changes benefit customers?
A: Over the past two years, VMware has been on a journey to simplify its portfolio and transition to a subscription model, the industry standard for cloud consumption, and to better serve customers with continuous innovation, faster time to value, and predictable investments. We’re also helping more customers benefit from VMware Cloud Foundation by reducing the list price by half and including higher support service levels including enhanced support for activating the solution and lifecycle management.
Q: Why is this good for partners?
A: The industry has already widely embraced subscription and SaaS, and many partners in our ecosystem have already developed success practices in this area. Subscription and SaaS models provide an opportunity for partners to engage more strategically with customers and deliver higher-value services that drive customer success. It also helps accelerate their own transition to a business model focused on annual recurring revenue.
Q: What are the changes to perpetual licenses?
A: As part of our transition to subscription and a simplified portfolio, beginning today, we will no longer sell perpetual licenses. All offerings will continue to be available as subscriptions going forward. Additionally, we are ending the sale of Support and Subscription (SnS) renewals for perpetual offerings beginning today.
Q: Why make this change from perpetual licenses to subscription?
A: This shift is the natural next step in our multi-year strategy to make it easier for customers to consume both our existing offerings and new innovations. VMware believes that a subscription model supports our customers with the innovation and flexibility they need as they undertake their digital transformations.
Q: Can customers continue to use their perpetual licenses?
A: Yes, customers can continue to use perpetual licenses that they’ve purchased for products.
Q: Can customers still purchase and add additional perpetual licenses after today?
A: After a customer’s effective date for the end of availability of perpetual licenses, customers will not be able to purchase new perpetual licenses. Customers will be able to purchase subscription software or term licenses to supplement or replace their current perpetual-licensed install base.
Q: Can customers renew their Service and Support (SnS) contracts after today?
A: No, customers cannot renew their SnS contracts for perpetual licensed products after today. Broadcom will work with customers to help them “trade in” their perpetual products in exchange for the new subscription products, with upgrade pricing incentives. Customers can contact their VMware account or partner representative to learn more.
Q: Do customers have to collect and submit their perpetual licenses to Broadcom when they “trade-in” their products for subscription?
A: No, Broadcom does not require customers to submit their perpetual licenses to Broadcom when they “trade in” their products for subscription.
Q: Will VMware by Broadcom continue to provide support for active Service and Support (SnS) contracts?
A: We will continue to provide support as defined in contractual commitments.
Q: What will happen to customers’ existing perpetual licenses with active SnS contracts when they are up for renewal?
A: Customers should contact their VMware account or partner representative for upgrade pricing from perpetual to subscription.
Q: What can customers with perpetual licenses do now to prepare?
A: This is an excellent time for customers to assess their current state with VMware infrastructure and management products. We encourage customers to review their inventory of perpetual licenses, including refresh cycles and renewal dates, and become more familiar with VMware's available subscription offers. Customers should also contact their VMware or partner representative for more information.
Q: What VMware Cloud Foundation division offerings are available for purchase?
A: The product simplification across the VMware Cloud Foundation division stems from customer and partner feedback requesting we reduce the complexity of our offers and go-to-market. Going forward, the VMware Cloud Foundation division will feature two primary offers: VMware Cloud Foundation, the new VMware vSphere Foundation and our Hybrid Cloud services and offers. Additionally, we offer VMware vSphere Standard and VMware vSphere Essentials Plus for deployments with more limited requirements.
Q: What is VMware vSphere Foundation?
A: VMware vSphere Foundation is a new solution that combines our full-featured server virtualization platform, vSphere with intelligent operations management to deliver the best performance, availability, and efficiency with greater visibility and insights. For customers seeking an HCI solution, we offer VMware vSAN as an add-on to vSphere Foundation, which includes all the capabilities of vSAN including vSAN Max.
Q: What happens to customers that have purchased HPP/EPP credits and still have an outstanding balance of unredeemed credits?
A: We are honoring existing agreements and will work with our customers to help with the redemption of credits on our new offerings.
Q: What products and bundles are impacted by this new policy?
A: Here is a list of products impacted by the new licensing policy:
- VMware Cloud Foundation
- VMware vSphere
- VMware vSAN
- VMware NSX
- VMware HCX
- VMware Site Recovery Manager
- VMware vCloud Suite
- VMware Aria Suite
- VMware Aria Universal
- VMware Aria Automation
- VMware Aria Operations
- VMware Aria Operations for Logs
- VMware Aria Operations for Networks