If you're reading this, you probably just opened a VMware renewal quote and did a double take. You're not alone. Since Broadcom closed its acquisition of VMware in November 2023, customers have reported renewal increases commonly running 2–5× their previous spend, and in some widely reported cases, far higher. None of it was an accident. It's the deliberate result of one of the most aggressive monetization strategies in enterprise software history.
The acquisition
Broadcom announced its intent to acquire VMware in May 2022 for approximately $61 billion in cash and stock, roughly $69 billion including assumed VMware debt. After 18 months of regulatory review across the US, EU, UK, and China, the deal closed on November 22, 2023.
Broadcom's playbook was well known from its prior acquisitions of CA Technologies and Symantec's enterprise business: focus on the largest, highest-margin accounts, cut costs aggressively, move everything to subscription, and accept churn at the low end. VMware customers hoped this time would be different. It wasn't.
Perpetual licenses: killed in under a month
On December 11, 2023, less than three weeks after closing, Broadcom announced the end of sale for all VMware perpetual licenses and the end of support-and-subscription (SnS) renewals for existing perpetual licenses. Customers who had budgeted around "buy once, pay ~20% a year for support" suddenly faced a hard wall: when your current support contract lapses, your only path to patches and support is a subscription.
The perpetual license itself doesn't stop working. But running production infrastructure without security patches or vendor support is a risk most compliance frameworks, and most cyber insurers, won't accept. (More on that in our End of Life Guide.)
The product line collapsed into two bundles
Pre-Broadcom, VMware sold thousands of SKUs, vSphere Standard, Enterprise Plus, vCenter, vSAN, NSX, Aria, Essentials kits, and endless à la carte add-ons. Broadcom collapsed nearly all of it into two core subscription offerings:
| Bundle | What's in it | Who it targets |
|---|---|---|
| VMware Cloud Foundation (VCF) | vSphere, vCenter, vSAN, NSX, Aria/Operations, HCX, the full private-cloud stack | Large enterprises; Broadcom's strategic focus |
| VMware vSphere Foundation (VVF) | vSphere, vCenter, Aria Operations, compute virtualization without NSX/vSAN entitlements at VCF scale | Mid-market customers who "just want vSphere" |
| vSphere Standard / Essentials Plus | Stripped-down vSphere tiers | Small environments; availability and terms have shifted repeatedly |
The practical effect: many organizations that licensed only vSphere and vCenter are now quoted for bundles that include products they never deployed and don't want. That bundling, not a single list-price hike, is the biggest driver of the renewal shock.
Per-core licensing and minimums
Broadcom also changed how you count. Licensing moved from per-CPU-socket to per-core, with a 16-core minimum per CPU. A modest dual-socket host with two 12-core CPUs is licensed as 32 cores, not 24. In 2025, Broadcom went further, introducing a 72-core minimum per order for new purchases and renewals, meaning very small environments pay for capacity they don't have. For a deeper breakdown of the mechanics, see VMware Licensing Changes Explained.
The partner purge
In early 2024, Broadcom terminated VMware's entire reseller agreement base and moved to an invitation-only partner program. Thousands of smaller resellers and cloud service providers were dropped. The VMware Cloud Services Provider (VCSP) program was cut from thousands of participants to a few hundred, with steep new minimum commitments.
For customers, that meant two things: the trusted reseller who used to negotiate on your behalf may no longer carry VMware at all, and the surviving large providers, the ones who committed to massive core counts, now hold VMware capacity at scale pricing that individual mid-market companies can't touch. That last part matters: it's why "stay on VMware through a managed provider" is often cheaper than renewing direct. See our provider directory.
What happened to prices
Broadcom maintains that list price per core is comparable to or lower than older editions. Customers' invoices tell a different story, because the change is multiplicative:
- Bundling: paying for vSAN/NSX/Aria you didn't license before
- Per-core counting: core-dense modern CPUs inflate counts vs. per-socket licensing
- Minimums: 16 cores per CPU, and later 72-core order minimums
- Lost discounts: legacy ELA discounts and partner margins evaporated
- Subscription vs. SnS: annual subscription replaces ~20–25% SnS on a sunk perpetual cost
Stack those together and the commonly reported outcome, renewals landing at 2–5× prior spend, with outliers far above that, is exactly what the math predicts. Want to see what that means for your environment? Run your numbers through our cost calculator.
The backlash: lawsuits, regulators, and an exodus
The reaction was unusually loud for enterprise IT:
- AT&T sued Broadcom in 2024, alleging Broadcom refused to honor contracted support-renewal options for perpetual licenses covering tens of thousands of VMs unless AT&T bought subscription bundles. The case was later resolved, but it put Broadcom's renewal tactics in open court filings.
- European cloud and user groups complained to regulators. CISPE (the European cloud infrastructure association) and others filed complaints over licensing terms and price increases; user organizations such as VOICE in Germany and Beltug in Belgium publicly documented members' increases and pressed the European Commission to act.
- Analysts told clients to evaluate alternatives. What had been an unthinkable conversation, leaving vSphere, became a standard board-level agenda item through 2024–2026.
By mid-2026, the result is a mature migration market: Nutanix, Proxmox, Hyper-V, OpenShift Virtualization, hyperscaler VMware services, and managed VMware clouds all have established VMware-exit practices, tooling, and reference customers. We compare them all in our alternatives matrix.
Timeline of key events
| Date | Event |
|---|---|
| May 2022 | Broadcom announces intent to acquire VMware (~$61B; ~$69B with debt) |
| Nov 22, 2023 | Acquisition closes after global regulatory review |
| Dec 11, 2023 | End of sale for perpetual licenses and SnS renewals announced |
| Jan–Feb 2024 | Partner program reset; thousands of resellers and CSPs dropped |
| 2024 | Product line consolidated into VCF/VVF per-core subscriptions; AT&T lawsuit; EU complaints mount |
| Apr 2, 2025 | vSphere 7.0 reaches End of General Support |
| 2025 | 72-core order minimums introduced; renewal wave hits mid-market hardest |
| 2025–2026 | Alternative-platform adoption accelerates; managed-VMware "stay for less" market matures |
| Oct 11, 2027 | vSphere 8.0 End of General Support (the next hard deadline) |
So what are your options?
Every VMware customer in 2026 has the same four paths:
- Renew with Broadcom, simplest, most expensive. Negotiation helps at the margins; the structure doesn't change.
- Stay on VMware through a managed provider, keep vSphere and your workflows, but let a VCSP partner (11:11 Systems, Expedient, TierPoint, and others) carry the licensing at scale pricing. Often the fastest savings with the least disruption.
- Migrate to an alternative hypervisor, Nutanix AHV, Proxmox VE, Hyper-V, or OpenShift Virtualization. Bigger lift, biggest long-term savings for many. See the comparison.
- Move to hyperscaler VMware, AVS, GCVE, or VMC on AWS. Low migration effort, but rarely the cheapest path.
Which one fits depends on your VM count, renewal date, hardware age, compliance posture, and team. That's exactly what our free assessment works out, without a single vendor pitch.