ECCO also expressed concern about Broadcom’s ongoing changes to its partner program, including “reassessing incentives, requirements, and tiering structures,” as announced earlier this month.
“Urgent measures”
ECCO’s report lists numerous “minimum urgent measures” that it believes Broadcom should take in order to make its VMware business model ethical, including guaranteeing at least “six months’ notice prior to any changes to contractual terms, pricing structures, or conditions applicable to renewals.”
However, given Broadcom’s financial success since acquiring VMware, it appears improbable that the tech giant will overhaul its business strategy.
“Broadcom is unlikely to make any voluntary changes to its new commercial terms. On the contrary[,] we fear it may further tighten conditions, as shown by recent moves to raise the bar for eligibility in partner programs,” Mingorance told Ars Technica via email, pointing to a need for “firm regulatory action.”
ECCO’s report also comes as many VMware customers, especially small to medium-sized businesses, have found alternatives to VMware, including other virtualization platforms, or are researching how to reduce their VMware dependence.
“Those who could leave have mostly done so, but they are the minority,” Mingorance said. “The rest are effectively locked in until credible alternative virtualization solutions, including third-party certified options like SAP, become available. That’s not yet the case.”
When asked for comment on ECCO’s allegations of “legally and ethically flawed” VMware practices and putting customers at financial disadvantages, a Broadcom spokesperson shared a statement focusing on Broadcom’s relationship with CSPs:
As a strategic partner with over 140 European [CSPs], of which more than 40 provide sovereign cloud services, Broadcom is working to advance the European Union’s sovereign cloud objectives and enable enterprises of all kinds to accelerate innovation, provide more choice, and address their most complex technology challenges. We welcome the opportunity to have a constructive dialogue with CISPE on how our products can help their European members be more competitive and innovative.
