Broadcom CEO Hock Tan Calls VMware’s First 100 Days 'A Strong Start'

'Of course, we recognize that this level of change has understandably created some unease among our customers and partners. But all of these moves have been with the goals of innovating faster, meeting our customers’ needs more effectively, and making it easier to do business with us. We also expect these changes to provide greater profitability and improved market opportunities for our partners,' Broadcom CEO Hock Tan says.

In a blog post that marked the first 100 days since Broadcom bought VMware, CEO Hock Tan said the rapid pace of change since the November deal close has “understandably created some unease” in the market.

“All of these moves have been with the goals of innovating faster, meeting our customers’ needs more effectively, and making it easier to do business with us. We also expect these changes to provide greater profitability and improved market opportunities for our partners,” he said.

While VMware partners have talked about the rising cost of the technology since Broadcom’s takeover in November with price spikes of at least 3x to 10x in some cases, Tan celebrated the low cost of VMware Cloud Foundation.

“VCF is a completely modernized platform for cloud infrastructure. It’s fully software-defined compute, networking, storage and management – all in one product with automated and simplified operations. It’s more fully integrated, so our customers can reap the full value from our technology,” Tan said of the changes to VMware Cloud Foundation. “To allow more customers to benefit from VCF, we’ve cut the previous subscription list price by half and increased support service levels.”

Yves Sandfort, CEO of comdivision, a VMware partner for more than two decades, based in Muenster, Germany, compared the last 100 days to a “historic rollercoaster” but he said after meetings with leadership, comdivision is even more committed to moving forward with Broadcom.

“As both a reselling and cloud partner for Broadcom we have been going to a steep transition in these 100 days, many ups and downs, more like historic rollercoaster,” he told CRN via email. “We had the opportunity to meet customers with Hock who moved from concerned to positive, but also review personally with him our future part in the partner ecosystem.”

Sandfort said working with Broadcom executives showed his team that its customer focus was stronger than what existed under the old VMware.

“Spending several weeks on campus and working with the Broadcom & VMware team on the future has given us a clear vision, we are more convinced then before, that our approach of going 100% all-In on Broadcom is the right move for the future,” he said. “However you need to be willing to let go of the past, stop glorifying what we had and work on the future, which I still see too many struggle.”

Under Broadcom, VCF combines several of VMwares previous products into a single platform for cloud infrastructure that offers fully software-defined compute, networking, storage and management, with automated and simplified operations.

“It’s more fully integrated, so our customers can reap the full value from our technology,” Tan said.

The idea is to meet Broadcom’s customers to solve CIOs’ biggest pain points: IT is complex and slows acceleration, simplify IT support to speed accelerations and provide all of that in a secure fashion.

Tan said Broadcom spent a year and a half preparing for the acquisition, but said there is much work that remains to be done.

“In the 18-month process of evaluating and acquiring VMware, we looked at everything to identify what’s needed to create more value for our customers,” he said. “We’ve acted decisively to increase customer value since we closed the acquisition in late November.”

Broadcom, he said, is committed to simplifying its entire portfolio of hardware and software. It has committed to invest $1 billion into VMware’s R&D.

Broadcom announced its plans to buy VMware for $61 billion plus $8 billion in debt on May 25, 2022. The deal closed in November 2023. Broadcom terminated VMware’s partner program in late December, then announced on Jan. 4 that it would take VMware’s top 2,000 strategic accounts away from partners.

Since the deal closed, Broadcom has also announced it would spin off the VMware End User Computing business and VMware’s Carbon Black business. Broadcom has agreed to sell the EUC property to the private equity firm KKR for $4 billion. It has kept the Carbon Black division which it will fold into Symantec for Enterprise, which it bought in 2016.

“The first 100 days were a strong start for VMware as part of Broadcom,” Tan wrote. “Please stay tuned. There's much more to come.”