Broadcom’s $69 Billion Acquisition of VMware: Views From The Field

Broadcom Inc.’s completion of the $69 billion acquisition of cloud computing giant VMware marks a pivotal moment in the tech industry.

An estimated 80% of enterprise workloads run on VMware technology, so while the deal is massive in terms of the scale of the acquisition, it will have large ramifications across many technology sectors.

This strategic move, finalized after overcoming significant global regulatory hurdles — including the crucial nod from China — signifies a new era in integrating hardware and software capabilities. But many are asking how this will shape Broadcom’s future in the technology landscape.

The deal, led by Broadcom CEO Hock Tan, faced its share of challenges, including multiple delays due to global regulatory scrutiny. However, the easing of geopolitical tensions, highlighted by recent diplomatic interactions between the U.S. and China, played a crucial role in facilitating this acquisition.

This merger is set to offer a comprehensive suite of infrastructure solutions, combining Broadcom’s semiconductor and software infrastructure prowess with VMware’s expertise in cloud computing and virtualization.

We are excited to announce the completion of Broadcom’s acquisition of VMware, marking another important step forward in our efforts to build the world’s leading infrastructure technology company.

Follow @Broadcom for further updates and read more here: https://t.co/FxLIKyzCzm pic.twitter.com/P5HcHClAHq

— VMware (@VMware) November 22, 2023

This acquisition opens up a spectrum of opportunities and challenges. It promises groundbreaking developments in private and hybrid cloud environments, enhancing enterprise application management and protection flexibility.

Yet, it also brings the task of integrating diverse corporate cultures and technological frameworks. The broader implications of such consolidations in the tech industry raise questions about future competition and innovation. 

I caught up with Gavin Jolliffe, CEO of Xtravirt, a VMWare Partner, to learn more about his thoughts on one of the biggest technology mergers ever.

Broadcom’s Role in Shaping VMware’s Technological Advancements

Q: What are the prospects for VMware’s innovative capabilities following Broadcom’s acquisition?

A: Over the last few months, we have seen VMware double down on innovation and consolidate features and capabilities across its core platforms. Post-acquisition, we anticipate VMware customers will benefit further as Broadcom makes their promises a reality.

I believe customers can expect Broadcom to drive further innovation inside the datacentre and look forward to receiving new levels of functionality offered to make their own private environments, allowing them to operate with more of the capabilities and benefits normally associated with public sector cloud.”

Navigating Change: What VMware Customers Can Expect

Q: What does this mean for VMware customers?

A: Over the last 12 months, Broadcom, and Hock Tan specifically, has made significant efforts to address concerns that reflected the impact on customers following prior acquisitions. We look forward to these coming to fruition so that we can all focus on the opportunities that access to investment will bring.

Prioritizing the continued strength of VMware products in the data center while continuing cross-cloud investment will reassure customers who benefit from cost or sovereignty benefits from an on-premise approach.

The Road Ahead for VMware Employees

Q: What does this mean for VMware employees?

A: While uncertainty related to the acquisition is now over, we recognize that it will continue for many employees over the coming months. Having been a VMware partner for over 15 years, we have built long-lasting friendships and working relationships with many talented people.

As changes occur, it will be difficult for all, but their skills are world-class, and we look forward to continuing to support and work with them within Broadcom and beyond.

Redefining Enterprise IT: VMware’s Role in a Broadcom-Driven Landscape

Q: What does this mean for VMware Partners?

A: We are excited to see how the commitment to invest $2B in R&D and Partners translates into our ability to increase customer success over the coming months.

We anticipate Broadcom’s increased focus on its largest customers and opportunities for Partners to support the broader customer base. We look forward to expanding into these new opportunities, having achieved significant customer success from our considerable investment in our VMware Consulting and Managed Services capabilities.

Shaping the Future of Enterprise Technology with Broadcom and VMware

Q: What is your vision for 2024 and beyond?

A: With over 80% of enterprise workloads running on VMware technology, it is clear that Broadcom’s direction following the acquisition is of enormous importance to customers worldwide. Working with VMware customers across multiple sectors, Xtravirt sees first-hand the skills challenges internal IT teams face and the competitive impact public cloud offerings have on the market.

Broadcom will need support from partners like ourselves to ensure customers continue to obtain full value from their existing products and understand the new opportunities the wider portfolio presents.

We are working hard to ensure these specialist skills are recognized as a critical differentiator in the partner marketplace. We look forward to growing our business with Broadcom following the acquisition.

Thoughts From the Field

Broadcom’s acquisition of VMware is a landmark event that reshapes the technology landscape, blending hardware and software capabilities in unprecedented ways. This strategic move, led by Broadcom CEO Hock Tan, has overcome significant global regulatory challenges, setting the stage for innovative developments in cloud computing and virtualization.

The merger promises to enhance enterprise application management and protection, offering new flexibility and functionality in private and hybrid cloud environments.

 

However, it also brings the challenge of integrating diverse corporate cultures and technological frameworks, which will require careful navigation but holds immense potential for shaping the future of enterprise technology.

As we look ahead, the insights from Gavin Jolliffe, CEO of Xtravirt, underscore the critical importance of this acquisition for customers and partners worldwide. Broadcom’s direction will have far-reaching implications, with many enterprise workloads running on VMware technology. Committing to invest in R&D and partnerships is a positive indicator of future growth and innovation. 

As the industry adapts to this significant change, the focus will be on harnessing the full potential of this merger, ensuring that customers continue to receive value, and recognizing the specialist skills of partners like Xtravirt as vital to the evolving enterprise technology landscape.

About Gavin Jolliffe

Gavin Jolliffe is the founder and CEO of Xtravirt, a cloud consulting and managed services firm. Moving from New Zealand to the UK in 2000, he has built a successful career around his passion for unlocking commercial success through technology.

The insights he’s gained from leading an organization that’s helped hundreds of organizations overcome their biggest challenges have led to Gavin gaining a place on industry advisory boards and being a regular industry commentator and keynote speaker on topics like multi-cloud and digital transformation.