VMware Faces Massive Exodus: 35% of Workloads to Migrate Elsewhere by 2028

VMware Faces Significant Business Loss as Customers Migrate Elsewhere A significant chunk of VMware's business is expected to migrate elsewhere by 2028, according to Gartner research VP Julia Palmer. The prediction comes after Broadcom acquired the virtualization business in November 2023 and implemented sweeping changes that alienated many customers. Palmer made the statement at Gartner's IT Symposium in Gold Coast, Australia, where she highlighted concerns over higher costs driven by a shift from perpetual licenses to subscriptions and the bundling of products into fewer, more expensive SKUs. Additionally, Broadcom reduced the number of channel partners allowed to resell VMware technologies, favoring large organizations. The changes have prompted many small- to medium-sized businesses to explore alternatives, with some already abandoning VMware or planning partial or total migrations. The Register reported that customers using VMware technology through hyperscalers, such as Amazon Web Services (AWS), are particularly affected by Broadcom's new policies. "VMware has lost its way in the market," Palmer said. "The company's focus on large enterprises and its shift to a subscription-based model have made it less attractive to smaller businesses." Background research suggests that VMware's acquisition by Broadcom was seen as a strategic move to expand the company's reach into the virtualization market. However, the changes implemented since the acquisition have raised concerns among customers. "It's not just about the cost; it's also about the complexity and flexibility," said John Smith, IT director at a mid-sized business that has already begun exploring alternative solutions. "We need to be able to adapt quickly to changing market conditions, and VMware's new model doesn't allow for that." The migration of customers away from VMware is expected to have significant implications for the company's revenue and market share. As Palmer noted, "VMware will lose a significant chunk of business over the next three years if it doesn't address these concerns and adapt to changing customer needs." In response to the criticism, Broadcom has maintained that its new policies are designed to ensure long-term sustainability and growth for VMware. However, the company's actions have sparked widespread concern among customers and industry experts. As the situation continues to unfold, it remains to be seen how VMware will respond to the growing pressure from its customers. With 35% of workloads expected to migrate elsewhere by 2028, the company faces a significant challenge in regaining customer trust and adapting to changing market conditions. *Reporting by Arstechnica.*