VMware’s New Direction: How Broadcom Is Moving Away from Small Businesses

In the wake of Broadcom’s $69 billion acquisition of VMware, small businesses are finding themselves on increasingly shaky ground. While VMware has long been a trusted virtualization platform for organizations of all sizes, Broadcom’s new licensing model and strategic shift are sending a clear message: the future of VMware is enterprise-focused. Broadcom is also sending Cease and Desist notices to many customers.

If your business relies on VMware today, these changes could significantly affect your bottom line and long-term IT strategy. Here’s what you need to know—and what you should consider doing next.

A New Direction: Enterprise Over Small Business

Broadcom’s post-acquisition strategy is to streamline and simplify VMware’s offerings—but for many companies, these “streamlined” changes translate to higher costs and reduced support. Here are some of the changes that are negatively affecting many small business VMware customers.

Minimum 72-Core Licensing Requirement
One of the most alarming changes for smaller businesses is the new licensing minimum. Broadcom now requires customers to license at least 72 CPU cores, priced at $150 per core—a $10,800 baseline investment, even for companies that only need a fraction of that capacity. For comparison, many companies previously operated comfortably on much smaller VMware deployments, often using the Essentials Plus Kit, which has now been retired.
Say Goodbye to Perpetual Licensing
Broadcom has also eliminated perpetual licenses, pushing all customers to subscription-only pricing. While subscriptions offer flexibility for some, many SMBs prefer capital expenditures (CapEx) over ongoing operational expenses (OpEx). This change could lead to higher long-term costs without the benefits of ownership.
Discontinued SMB-Friendly Products
Long-standing SMB solutions like VMware Essentials and Essentials Plus Kits are no longer available. The remaining options, such as vSphere Standard or Enterprise Plus, are overkill for many small environments—both in terms of capacity and cost.
Less Support for Smaller Clients
Broadcom is reportedly focusing its resources on its top 600 customers, which may leave SMBs with fewer support options and longer wait times for assistance. For smaller IT teams that depend on vendor support, this is a significant risk.

Why It Matters

VMware has been a cornerstone of infrastructure for businesses of all sizes, but Broadcom’s changes suggest that small businesses are no longer part of the long-term vision. These shifts in pricing, product offerings, and support create an environment where smaller companies may struggle to justify the cost and complexity of maintaining a VMware-based infrastructure.

If you’re a company relying on VMware, it’s time to re-evaluate. Don’t wait until your next renewal or support call to realize the rules have changed.

Is It Time to Consider Alternatives?

With VMware moving upmarket, many companies are starting to explore alternative infrastructure models, including:

Hyperconverged Infrastructure (HCI): A simplified approach that combines compute, storage, and networking in one solution, like Scale Computing, are great for scalability and cost-efficiency.
Cloud-Based Virtualization: Public cloud platforms like Microsoft Azure or Amazon Web Services offer powerful virtualization without the high upfront costs.

Don’t Get Caught Off Guard

Broadcom’s changes to VMware licensing and support represent a major shift in the virtualization landscape. For many companies, the costs, complexity, and lack of tailored support may outweigh the benefits.

Now is the time to:

Audit your VMware usage and current licensing
Evaluate the cost implications of Broadcom’s changes
Explore modern alternatives like hyperconvergence or cloud
Partner with an IT provider who understands the new landscape

If you’re unsure what your next step should be, we can help. REACH OUT today for a Virtualization Strategy Session and let’s find the solution that fits your business—not someone else’s.

Don’t Miss Our VIP Golf Event Coming Soon at Golf Galaxy

Thursday August 14, 2025, from 11 am – 3 pm

Golf Galaxy

4070 Stevens Creek Blvd, San Jose, CA 95129

Drop in for an hour or two: Must be present to Win

What to Expect

This isn’t your average tech event. We’re bringing together IT leaders and decision-makers for a relaxed, high-impact experience at Golf Galaxy. Here’s what’s in store:

Come and enjoy the golf simulation bay while getting pointers from a Golf Pro
Play Pebble Beach and the St. Andrews Old Course in Scotland through simulation
Free Club Fitting ($100 value) if you bring or invite a new company interested in Nevtec
Giveaways including for a round of golf at Spanish Bay, a new driver, club fittings, and more
Lunch, bites and cocktails
Networking with peers and industry experts
Live demos of Scale Computing’s platform in action
Exclusive insights on navigating the post-VMware landscape
VIP Gift Bag: golf balls, tees, towel and more