As the books closed on the first year since Broadcom acquired VMware, the semiconductor giant turned to its technology partners to drive adoption of VMware Cloud Foundation.
Bringing resellers and service providers on board has become a priority to boost sales of the virtualization software suite.
“We are doubling down on our partners,” Prashanth Shenoy, VP of product marketing in the VCF Division of Broadcom, told CIO Dive. “We have transitioned our services model from a Broadcom-led model to a partner-led services model.”
The strategy marks a shift for Broadcom.
VMware’s partnership program was one of the many initial casualties of the merger. In the first months following the $61 billion acquisition, Broadcom ended perpetual product licenses in favor of subscription billing, slashed VMware offerings from thousands of individual SKUs to four large bundles and abruptly revamped its third-party support ecosystem.
Existing reseller agreements were cancelled as the company invited more than 18,000 VMware resellers to transition to the Broadcom Advantage program.
The speed, scope and severity of the changes caused consternation among enterprise customers. AT&T took to the courts last summer, seeking injunctive relief to extend licensing support in a suit that was eventually settled. But the telecommunications giant was not alone in its complaint that VMware costs had skyrocketed under the new regime as the changes threatened to disrupt business operations.
Last year, VMware customers had a chance to weigh their options. Broadcom felt confident that in most head-to-head comparisons, the full-stack VCF platform offered greater value than alternatives, despite its overall cost, according to Shenoy.
More than two-thirds of the company’s largest VMware customers adopted VCF, Broadcom CEO Hock Tan said earlier this month during the company’s Q1 2025 earnings call. Broadcom has moved 60% of customers using the smaller vSphere virtualization software bundle to subscription billing, according to Tan.
“The dust has settled down from our business model, from our portfolio, from our offer strategy, from our route-to-market strategy and our partner go-to-market,” Shenoy said.
The executive expects nearly all VMware customers to transition to subscription bundles by the end of 2026, as the company turns its attention moving the integrated VCF 9 upgrade from beta into full production later this year and rolls out additional private cloud features, including AI, ransomware recovery and data protection capabilities.
“We are betting big on a private cloud renaissance,” Shenoy said. “This is the public cloud experience that we are building on-prem in a modern private cloud.”
Reenergizing resellers
Technology partners serve as a bridge that connects IT customers to enterprise-specific technical support and guidance that isn’t always available from the primary provider.
“Partners are uniquely positioned to provide localized expertise, scale and value-added service,” Brian Moats, Broadcom SVP of global commercial sales and partners, said in a January blog post.
Moats promised closer collaboration with partners and renewed investment in its reseller and service-provider ecosystem in January, offering support through training and certification programs.
Broadcom telegraphed its VMware priorities to the vast network of resellers, global systems integration firms and managed service providers that it's leaning on to drive VCF adoption.
“They're saying, ‘we’re relying on you to do all the things that we talked about with optimization and realizing that private cloud dream,’” said Holland Barry, CTO of cloud and infrastructure at DXC Technology. “They’re leaning on us to deliver that.”
DXC was one of the first global service providers to sign on as a VMware cloud service partner last year. Barry had a frontline view of the tumultuous transition.
“When you take something that’s such a fundamental underpinning of a company’s IT estate and say that things are changing, you're going to have a series of emotionally charged conversations,” said Barry. “Some of those early conversations were about people wanting to explore alternatives to VMware.”
As customers vetted other vendors and Broadcom articulated its private cloud vision, some of the tensions eased.
“It’s really difficult for people to move on from VMware,” Barry said. “In some cases, people are taking applications and data sets and pursuing those alternatives. But if you’re a large entity that has tens of thousands or maybe hundreds of thousands of cores in your estate, it’s non-trival to make a change.”
