Dell is officially terminating its agreement with VMware
Well, this is just more of the same "bad news" for VMware coming down the pipes. Dell is officially terminating its agreement with VMware after the Broadcom acquisition. A filing on January 25 notes that Dell is ending the agreement that started back in 2021 between the two companies.
The agreement in question was finalized on the same day Dell and VMware went their separate ways. Back then, Dell was fully committed to VMware, which was the driving force behind their agreement. The objective was to establish a formal commercial relationship to continue reaping the strategic benefits for both Dell and VMware. This included a commitment to ongoing collaboration on solution development and a joint go-to-market (GTM) strategy.
Despite the unchanged benefits of such collaboration for customers, Broadcom's decision to disallow manufacturers like Dell from reselling VMware product licenses has changed the landscape. This shift is part of Broadcom's broader strategy to move away from perpetual VMware licenses in favor of software subscriptions that encompass various products.
Broadcom's decision has been met with disapproval both from OEMs, who are facing the loss of a revenue stream, and from customers. Many customers preferred purchasing bundled licenses with hardware, which often proved more efficient than acquiring them separately.
You can read the official SEC filing here:
Also, voice your thoughts on migrating from VMware vSphere to a different hypervisor in the forum thread here: