Managed Services

Abandoned VMware Partners Courted by Broadcom Competitors

Signage is displayed outside the Broadcom offices on June 7, 2018, in San Jose, Calif. (Photo by Justin Sullivan/Getty Images)

VMware partners continue searching for alternatives post-Broadcom acquisition, and plenty of vendors are jumping in to fill the void.

It's a big difference from the picture VMware painted a year ago. Back then the company said it was doubling-down into managed services, recognizing that it's partners were moving into new revenue streams as the marketplace evolved. But that all came to a crashing halt once the Broadcom acquisition of VMware was completed.

In mid-December 2023, thousands of VMware resellers, distributors and service providers were told that the partner program, along with its incentives and their status within it, was terminated and that it would be replaced with the Broadcom Advantage Partner Program, effective Feb. 5, 2024. Partners were told they would be contacted in January to learn whether Broadcom would invite them to continue to sell the products.

But in early January, published reports said that many VMware partners had not yet received information about whether or not they would continue, leaving them “scared, angry and terminated.”

Abandoned VMware Partners Offered Multiple Alternatives

Joseph Landes, chief revenue officer at Nerdio, said that what's happening with Broadcom and VMware is no surprise.

"From the very beginning, Broadcom indicated that they would make major changes to the way that VMware does business," he said. "However, the announcement signals much larger changes occurring in the VDI market."

Landes said that many businesses are looking to move from VDI to cloud-based desktop or desktop-as-a-service, which is one of the services that Nerdio offers.

"I anticipate that impacted VMware partners who may not be invited back to Broadcom’s new partner program will look for alternative DaaS solutions like Microsoft technologies," he said. "They’re looking for providers that understand their needs while leading with innovation and forward-thinking strategy. That’s what VMware is no longer offering, so what’s going on now is just an escalation of a trend I’ve been seeing for a while." 

Nerdio and many other vendors are capitalizing on the opportunity, looking to fill the vacuum left by Broadcom's abandonment of VMware's partners.

VergeIO: Big Uptick in Outreach from Former VMware Partners

George Crump, chief marketing officer at VergeIO, said he has seen partners looking for alternatives. Since Broadcom's partner program termination announcement in December, he has seen a 200% increase in outreach from partners investigating alternatives, Crump told ChannelE2E.

“Obviously, VergeIO is an option, but there are others,” Crump said. 

Nutanix Offers Simplified Migration Path

Nutanix is an often-mentioned option for partners. In a LinkedIn post, Nutanix’s Lee Caswell explained some of the challenges VMware partners face, and added that Nutanix is providing a simplified migration path for partners that want to make the switch. In addition, the company said new customers may qualify for one year of Nutanix licensing free in addition to free migration services for deployments on numerous platforms, including core data center, edge, or public cloud.

Leostream Eases the Transition

Leostream, a Remote Desktop Access Platform provider, also rolled out new channel initiatives to welcome, onboard, and support former VMware partners. In Leostream’s case, the goal is to transition customers from VMware Horizon to the Leostream Platform for hosted desktops and workstations.

The V-Partner Continuity Program offers new incentives for solution providers, managed service providers, and other technology resellers terminated by Broadcom along with specific tools and training to serve customers whose Horizon licenses are expiring, according to the company.

The Leostream platform integrates with any hypervisor, any hardware, any on-premise or cloud resource, any end user device, and any major remote display protocol. After end users are moved to Leostream, partners can make changes to the underlying infrastructure non-disruptively as customer needs evolve. This allows organizations to continue using vSphere as long as needed, and then integrate different hypervisors, clouds or hyperconvergence platforms in the future.

“This program assures service and loyalty to those partners whose customers rely on VDI, DaaS, and other hosted desktop technologies to support hybrid and remote workforces,” said Randy Foster, Leostream VP Sales and Marketing. “Former VMware partners will find that with the unique remote access workflows the Leostream Platform facilitates, its management simplicity, security, BYOD flexibility, and low cost of ownership, the VMware problem has become a major opportunity.”

V-Partners can access sales and marketing materials, training courses, enablement collateral, customer opportunity registration, recruiting, and tracking revenue from the Leostream Partner Portal. Partner-only documentation includes overviews of new releases, so partners can learn about new features directly from Leostream experts, along with a roadmap to assist with strategic planning. 

Leostream also provided free training for new partners and free onboarding for the first 10 customer opportunities, the company said.

But some of these alternatives may introduce additional complexity, Crump said, which adds another level of frustration for partners. “Some of the options are open source which creates problems - the last thing you need is to go from complicated to more complicated,” he said. “What partners need to be looking for is seamless migration, the ability to use existing hardware, data protection, better margins with lower costs,” he said.

VergeIO’s complementary migration service meets with partners to map out VMs and provide all consulting services, Crump said. “We then create a plan and help execute the plan to make the move painless,” he said.

Broadcom's Strategy: Short Term Gains, but a Longer Term Failure

Canalys Chief Analyst Jay McBain said in a LinkedIn post that Broadcom’s strategy with Broadcom will reduce expenses in the next 18 months and make the executives look like financial geniuses. But Broadcom is throwing away a product-sticky and partner-friendly VMware by taking the top 2000 clients direct, cutting sub-$500k partners because they aren’t profitable enough, and conducting heavy workforce reductions and expense management.

Short term gains may seem impressive, but in the longterm, this strategy will fail, he said.

“When the book is written 10 years from now, the conclusion will be short-term thinking and a financial hack on capitalism (the rich get richer) resulting in the decimation of a legendary tech brand,” McBain wrote here. “The circle of trust (partners) surrounding every buyer have already turned negative. Go and sort the most valuable companies in the world and one thing jumps out - they are all platform companies (partner friendly and ecosystem orchestrators).”