The subscription model will help partners gain more annual recurring revenue, the company says.

Edward Gately, Senior News Editor

December 12, 2023

2 Min Read
VMware by Broadcom focuses on SaaS subscriptions
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VMware by Broadcom has simplified its portfolio and completed the transition of all of its solutions to subscription licenses.

Broadcom completed its $69 billion acquisition of VMware last month.

Krish Prasad, senior vice president and general manager of the VMware Cloud Foundation division, said over the past two years, VMware has been on a journey to simplify its portfolio and transition from a perpetual to a subscription model to better serve customers with “continuous innovation, faster time to value and predictable investments.”

Going forward, the division will feature two primary offers: VMware Cloud Foundation and the new VMware vSphere Foundation.

VMware by Broadcom has reduced the previous subscription list price for VMware Cloud Foundation by half and added higher support service levels, including enhanced support for activating the solution and life cycle management.

VMware vSphere Foundation delivers a more simplified enterprise-grade workload platform for midsize and smaller customers.

More Coming from VMware by Broadcom

“Both VMware Cloud Foundation and VMware vSphere Foundation will have optional advanced add-on offers,” Prasad said. “Our storage offering, ransomware and disaster recovery service, and application platform services are available on both offers. And application network and security offerings are available for VMware Cloud Foundation. Additional advanced services and offerings, including private artificial intelligence (AI), will be available soon.”

Broadcom's Krish Prasad

The offerings will solely be available as subscriptions or as term licenses following the end of sale of perpetual licenses, and support and subscription renewals.

“The industry has already widely embraced subscription and SaaS, and many partners in our ecosystem have already developed success practices in this area,” Prasad said. “Subscription and SaaS models provide an opportunity for partners to engage more strategically with customers and deliver higher-value services that drive customer success. It also helps accelerate their own transition to a business model focused on annual recurring revenue.”

The product portfolio simplification allows customers of all sizes to get more value for their investments in VMware solutions, he said. The portfolio simplification stems from customer and partner feedback over the years "telling us our offers and go to market are too complex.”

“The simplification of our portfolio and shift to subscription and term offerings are a culmination of our multiyear business transformation efforts,” Prasad said. “The steps we’re taking today will further enable customer and partner success by delivering the innovation, simplicity and flexibility they need as they undertake their digital transformations.”

About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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