Partners: HPE VM Essentials Provides Alternative To Broadcom VMware Virtualization ‘Heartburn’

'What’s most exciting to me as a solution provider is we now have an answer, a choice, an option for our customers who are really upset about what is going on,' says Nth Generation Co-President and CTO Dan Molina.

Hewlett Packard Enterprise partners told CRN that the new HPE VM Essentials virtualization product provides an antidote to the big price hikes facing Broadcom VMware customers.

“What’s most exciting to me as a solution provider is we now have an answer, a choice, an option for our customers who are really upset about what is going on,” said Dan Molina, co-president and chief technology officer of Nth Generation, San Diego, No. 278 on the CRN SP500. “These customers have built up a dependency on a hypervisor that powers their workloads. Being forced to pay these types of (price) increases is creating a lot of heartburn. We love the idea of being able to present options to our customers.”

HPE partners told CRN that the majority of their customers have been grappling with price increases of 200 percent to 300 percent and in some cases even higher.

Broadcom VMware declined to comment on the prices increases faced by customers or how its product portfolio stacks up against HPE VM Essentials.

HPE is providing partners with a per socket pricing model on VM Essentials that is in sharp contrast to the core processor pricing model that has resulted in big price increases for Broadcom VMware customers.

In fact, HPE claims customers modernizing with HPE GreenLake cloud and VM Essentials will “save up to five times TCO (total cost of ownership).”

“It looks like with VMware Essentials, HPE has been able to figure out how to cut through the costs, performing the essential duties of a hypervisor which is what the vast majority of customers need,” said Molina (pictured above).

Molina said he sees a “significant opportunity” ahead to provide VM Essentials as a Broadcom VMware alternative in 2025 and 2026. “It’s going to be a phased approach because many customers have multi-year subscriptions with VMware that they can’t get out of,” he said. “We’ll see a percentage (of customers adopt HPE VM Essentials) in 2025 and then another percentage in 2026.”

Broadcom had its reasons for the VMware price hikes but the reality is it has “affected many of our clients who are quite concerned,” said Molina. “That is pushing them to make some drastic decisions very, very fast. With HPE VM Essentials, we are now going to be able to have conversations with those customers on how they can refine their virtualization strategy.”

Bob Panos, vice president of sales and professional services at American Digital, Elk Grove Village, Ill., said he expects customers facing exorbitant VMware price increases to look to HPE VM Essentials as part of a “cost avoidance” strategy.

“With VMware prices up three, four and five times, HPE even coming in at old VMware prices will still save customers a lot of money,” said Panos. “This is a conversation starter and door opener for sure. Everyone is having a conversation about what are the alternatives to VMware because customers are facing significant price increases. VM Essentials is going to allow us to have conversations that we have not been able to have. This is a door opener that could have a significant impact on our business.”

Panos called HPE a “great alternative” to VMware from a trusted company. He said Morpheus combined with OpsRamp teamed with VM Essentials is a game changer for customers.

“HPE is really bringing all the right tools partners need for the future,” he said. “We are really excited about it. I’ve told my whole team we’ve really got to get behind Morpheus, OpsRamp and VM Essentials!”

Rob Schaeffer, president and chief revenue officer of e360, a top HPE partner based in Concord, Calif., No. 128 on the 2024 CRN SP500, said the VMware price increases has resulted in sharp increases for midmarket customers.

“Our midmarket and SMB customers are getting crushed with price increases,” said Schaeffer. “We are in the business of creating customers for life. So we are always on the lookout for the best technology for business outcomes. We’re excited about VM Essentials because we know that what we always get from HPE is innovation and the highest quality technology.”

Schaeffer said he is particularly excited that his team can start selling VM Essentials in December. “We are looking forward to getting our sales team behind VM Essentials,” he said. “We are coming out of a strong 2024 for our HPE business and are looking forward to an even better 2025.”

A CEO for a top HPE partner, who did not want to be identified, said every midmarket customer is interested in VMware alternatives. In fact, he just met with the CIO for a $4 billion company that has been hit hard by VMware price increases and is anxious to look at alternatives.

“Broadcom has made a very big mistake with the VMware strategy,” he said. “Even if people are afraid to move and they stick with VMware they have gone from having a positive view of VMware to a negative view. Even if they don’t lose a lot of market share – which I think they will – they are just not taking the high road.”

The CEO said HPE VM Essentials is going to pack a bigger punch than other VMware alternatives on the market. “There are alternatives and then there are alternatives from enterprise ready partners like HPE,” he said. “I think VM Essentials is a much bigger threat than Broadcom VMware realizes.”