Key Takeaways:
- A group of cloud service providers claims Broadcom’s VMware business model is unfair.
- They say VMware now forces customers into expensive, bundled subscriptions.
- These changes have upset many businesses that rely on VMware.
- A report from a European group details these concerns.
Cloud Service Providers Unhappy with Broadcom’s VMware Changes
A group of European cloud service providers and their partners are speaking out against Broadcom. They say the company’s business model for VMware is unfair and even “legally and ethically flawed.” These claims were made in a recent report released by the European Cloud Competition Observatory (ECCO).
ECCO is a group that watches over fair competition in the cloud industry. They say big companies like Broadcom are making it hard for smaller businesses to compete. The report focuses on changes Broadcom made to VMware’s pricing and licensing rules.
What’s Changed with VMware Under Broadcom?
Before Broadcom bought VMware, the company sold software that allowed businesses to manage their cloud services. Customers could buy specific tools they needed. Now, Broadcom is pushing “bundled subscriptions.” This means customers have to buy a package of products, even if they don’t need all of them.
Cloud service providers say this is unfair. They believe it forces them to pay more for things they don’t use. This makes it harder for them to compete with bigger companies that can afford the expensive bundles.
Why Are Cloud Providers Upset?
The report explains that these changes are bad for competition. Smaller cloud service providers are struggling because they can’t afford the new pricing model. This could mean higher costs for smaller businesses and even consumers.
ECCO also says Broadcom’s new rules limit how cloud providers can use VMware’s products. For example, some providers can’t offer customized services anymore. This makes it harder for them to stand out in the market.
What Did Broadcom Say About This?
ECCO met with Broadcom to talk about these concerns. But so far, Broadcom hasn’t made any changes. The company seems to be sticking with its new business model. This has left many cloud providers frustrated and worried about the future.
A Bigger Problem for the Cloud Industry
ECCO has pointed out similar issues with other big companies, like Microsoft. They believe these practices hurt competition and innovation. If big companies keep doing this, it could make the cloud market less fair for everyone.
What’s Next?
ECCO is hoping to bring more attention to this problem. They want regulators to step in and stop unfair practices. If nothing changes, smaller cloud providers might struggle to survive. This could lead to fewer choices for businesses and higher prices for everyone.
Final Takeaway
Broadcom’s changes to VMware’s business model are causing big problems for cloud service providers. Customers are forced to pay more for services they don’t need, and smaller businesses are struggling to compete. If this continues, it could hurt the whole cloud industry. Regulators need to act to keep the market fair and competitive.
This story is important because it shows how big companies can make decisions that affect many smaller businesses. It’s a reminder that fair competition is key to innovation and growth.