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Broadcom faces challenges with latest VMware releases

CIOs are taking a hard look at the VMware portfolio as the number of alternatives rises in the hybrid cloud infrastructure market.

Many enterprises remain uncertain about continuing with Broadcom's VMware, and the major changes the vendor recently made to its hybrid cloud platform are unlikely to change that stance, analysts said.

This week, Broadcom, which acquired VMware last November, introduced a VMware Cloud Foundation upgrade that consolidates dozens of products and bundles into a single platform. Broadcom plans to release VCF 5.2 by late July.

The unified platform for computing, storage, networking, security and cloud management falls under a single per-core subscription license. Gone are the perpetual licenses enterprises held for individual VMware offerings, which comprised 168 product editions and bundles as well as nearly 9,000 SKUs, according to Broadcom.

The massive changes Broadcom has brought to VMware's product portfolio are an inflection point for many enterprises. Faced with such disruption, CIOs are taking a hard look at the VMware portfolio, weighing the potential benefits of the changes and deciding whether to stay or leave to a competitor.

"It's brought a lot of things into focus and attention that maybe before were just running under the radar because [VMware] was established," said Tony Lock, an analyst at Freeform Dynamics.

VCF 5.2 requires an enterprise CIO to make an organization-wide purchase and commit to following the VMware product roadmap, said Naveen Chhabra, lead VMware analyst at Forrester Research. That might not jibe with the needs of an organization's networking, server, storage and application development teams that are used to buying what they need separately.

"They have their own needs, their own drivers and their own challenges," Chhabra said. "Is VMware the innovator and the leader in all categories? The answer is no."

Also, VCF's subscription license represents a four- to seven-times price increase for enterprises that paid for a perpetual license for a single product in the suite, he said.

The backdrop to the massive product consolidation is a changing data center computing market dominated by the VMware server virtualization platform. Enterprises are shifting to more modern architectures comprising cloud-native technologies such as containers, microservices and serverless computing.

Forrester stands by its prediction late last year that 1 in 5 VMware customers will gradually leave the platform for alternatives and cloud-native architectures competing with VCF, Chhabra said.

Within public clouds, VCF competes with Google Compute Engine, Amazon EC2 and Microsoft Azure virtual machines. In private cloud data centers, rivals include Nutanix Cloud Infrastructure, DigitalOcean and HPE Private Cloud, which includes a Kernel-based Virtual Machine capability introduced at the company's Discover conference last week.

Broadcom tries to hold VMware customers

Still, VCF 5.2 includes features to entice enterprises to stay with Broadcom. VCF Import enables businesses to take the vSphere compute virtualization platform, vSAN virtual storage and the NSX virtual networking suites and turn them into a single VCF deployment that simplifies management by providing universal upgrades and patches.

VMware also lets organizations stick with its virtualization platform if that's all they want. The company introduced this week vSphere Foundation 5.2 virtualization technology.

VCF and vSphere Foundation are the only two VMware platforms that Broadcom offers.

For cloud-native application developers on VCF, Broadcom kept the Tanzu Kubernetes Grid separate, making it easier to keep the product in line with Kubernetes updates. TKG is the runtime for Kubernetes, an open source container orchestration system for managing containerized workloads.

Whether Broadcom's product consolidation strategy will succeed against rivals remains to be seen.

"I'd say the alternative ecosystems are probably much more mature than they were three, four, five, six years ago," Lock said. "So, in terms of the competitive landscape, it's much more competitive now than it was."

Antone Gonsalves is an editor at large for TechTarget Editorial, reporting on industry trends critical to enterprise tech buyers. He has worked in tech journalism for 25 years and is based in San Francisco. Have a news tip? Please drop him an email.

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