Historically, VMware, a pioneer in data center virtualization, was considered a technology leader, but recent business changes have caused consternation since its acquisition by Broadcom in late 2023. Bundling and pricing of new products, program adjustments resellers, divestments and unanticipated changes motivate CIOs and IT departments. suppliers to reevaluate their strategies and technologies.

“This is going to change the relationship that customers have with the company, because Broadcom’s goal is to operate as efficiently as possible,” said Rajiv Ramaswami, president and CEO of Nutanix, in an April 2024 episode of Bloomberg Tech Disruptors Podcast.

“What this means for customers is: price increases, potentially less support…and that creates disruption within the channel partner community,” he said. “For us, this is a multi-year opportunity.”

The changes in the industry and the aftermath of disgruntled Broadcom VMware customers have been widely reported. In January 2024, The Wall Street Journal highlighted the attention that Broadcom’s VMware overhaul attracted from CIOs, followed by reports of changes in pricing and reseller agreements. The Register later noted: “whispers of a breakup with AWS”, despite Broadcom address the problem in a blog post. Many customers remain wary, prompting IT managers to explore alternatives and adjust their strategies regarding VMware products.

On the Tech Disruptors podcast, Ramaswami explained how Nutanix addresses the growing demand for simplified IT infrastructure and positions itself as the simplest alternative for VMware customers looking to reduce risk or dependency.

Podcast host Woo Jin Ho, an analyst at Bloomberg, said: “From my calculations, it seems that (Broadcom) has cut about 10,000 channel partners out of their 28,000. (They are) now down to 18 000. Does this potentially expand the Channel Partner Program for you? »

Ramaswami confirmed.

“We have certainly seen a higher level of engagement with many of the channel partners,” Ramaswami said, highlighting a recent announcement that WiPro has created a Nutanix Business Unit to accelerate digital transformation and hybrid multicloud innovation.

Many joint Nutanix and VMware partners are looking to renew their Nutanix partnership, especially those losing top 2,000 customers.

“Many customers who were familiar with the Broadcom playbook signed three- to five-year enterprise agreements with VMware before the deal closed,” Ramaswami said, adding that this saved them time.

Many consider Nutanix “the simplest alternative,” he said. “Not everyone is going to carry out mass migrations. Many could adopt a dual vendor strategy and use Nutanix in part of their business.

Woo recognized the growing importance of hybrid multicloud following the COVID pandemic, a period that has accelerated digital transformation to accommodate remote working and the rise of e-commerce.

“People are discovering that stable workloads can be run much more efficiently and cost-effectively in their own data centers,” Ramaswami said, highlighting how X (formerly Twitter) has optimized its use of the cloud, moving more on-premises and reducing monthly cloud. costs by 60%, data storage by 60% and data processing costs by 75%.

This encourages the CIO to move to hybrid and multicloud.

In the recent Nutanix article Enterprise Cloud Index (ECI) – who questioned 1,500 IT professionals, DevOpsAnd platform engineering Global Leaders: More than 80% of organizations view hybrid IT as essential to managing applications and data. Nearly half indicated that implementing hybrid IT is a top priority for their CIO.

The interview suggested that CIOs are careful with their IT budgets and that even if they spend, they do so with a total cost of ownership (TCO) in mind.

“We have a TAM (total addressable market) of around $76 billion and that includes software-defined compute, storage and networking,” Ramaswami said. The disruption resulting from the Broadcom-VMware acquisition “gives us the opportunity to increase our (market) share faster than we probably normally have in this TAM.” I would see this as an acceleration.

Ramaswami discussed the growth of large Global 2000 companies and small businesses around the world, many looking to expand their use of Nutanix. A large company in the Asia Pacific region that has pursued a dual Nutanix and VMware strategy recently chose Nutanix over VMware for expansion, while smaller customers show potential for full migration to Nutanix.

And he noted that after the Broadcom deal closed, a smaller public health system accelerated its move to Nutanix, in just 90 days.

“We’ve done a lot of work on automating migrations for simpler environments, but also for very complex environments,” Ramaswami said.

Learn how Nutanix can accelerate your journey to hybrid cloud and transform your business.

Disclaimer: Nutanix, Inc. is not affiliated with VMware by Broadcom or Broadcom.

Ken Kaplan is editor-in-chief of Nutanix’s The Forecast. Find it on @kenekaplan.