What happened to Broadcom and AT&T

Broadcom and AT&T seem to be resolving their licensing issues out of court, the latest court filing indicates. We had suspected this was likely to happen, but now it appears to be happening. This development makes sense – neither party would like to hash this out in public. Broadcom especially ran the risk of losing the case and ending up with a very unfavorable precedent. Unfortunately for everyone else, Broadcom will likely be undeterred in pursuing its licensing and repricing strategy across its customer base (I recently spoke with a client who saw an over 600% increase in their VMware renewal). With the VMware end of life for older products on the horizon, many users may find themselves locked into these new terms. It’s also likely that a vast majority of VMware users will not have the financial might or risk appetite to take Broadcom to court. It’s also not clear if AT&T will continue with its previously declared plan to get off VMware – though I suspect that’s still a long-term goal.

What to do?

While we wait to see how the Broadcom/AT&T saga comes to a close (we are likely not to see any details of the resolution), our recommendations around VMware remain unchanged:

1. Review all VMware contracts carefully and establish a clear license entitlement picture. Identify any negotiation levers.
2. Consolidate and downsize the VMware footprint.
3. Identify alternative technologies and migration plans where feasible and consider a long-term strategy to get off VMware.

If you need expert support in navigating the Broadcom VMware license changes and are looking to reduce costs, feel free to contact us for a complimentary consultation. For latest news follow us