VMware Isn’t Broken — So Why Fix It?

VMware Isn’t Broken — So Why Fix It?

I had a fascinating conversation yesterday with a group of large VMware customers, and let me tell you, there was no ambiguity in their viewpoints. These weren’t run-of-the-mill VMware shops—they’re deeply embedded, mature users who’ve lived through the shifts from perpetual to subscription, from vSphere to VCF, and now into the unknown of Broadcom ownership. And yet, the key takeaway was loud and clear: VMware itself isn’t broken.

Let’s unpack that.

The Not-Broken Reality

The technology—vSphere, NSX, vSAN, and yes, even VCF is doing its job. One executive, a veteran negotiator who’s made a career out of extracting maximum value from vendor contracts, flat-out said it wasn’t worth his time to rip and replace. He’s not even on VCF 8 or 9. He’s a vSphere guy. He’s focused on AI initiatives and strategic outcomes, not refactoring a hypervisor stack that works. His plan? Continue to negotiate hard with VMware but stick with the platform because it’s reliable and proven.

Then there’s the second customer—a VCF shop. He went through the pain of adopting VCF and likened it to the same effort as adopting OpenStack. That’s a major statement. But now that he’s on the other side of that complexity? He’s good. He’s getting value. And with renewal coming up in a year, he’s not looking to pivot unless something drastically changes. He’s holding steady, not because he loves VMware, but because it works and there’s no upside in switching horses mid-race.

The Real Problem Isn’t VMware Tech—It’s the Value Proposition Beyond It

For all the talk about Broadcom licensing, the real competition for these customers isn’t about cheaper licensing or mimicking VMware features. These IT executives aren’t moving off VMware for trivial reasons. They’re looking for a compelling capability that VMware doesn’t offer—something transformational, not incremental. Think AI platforms, sovereign cloud innovations, developer-first platforms like DB2 on RDS, or integrated ERP intelligence that helps the business compete more effectively.

That means if you’re a vendor hoping to poach VMware customers, you better come with more than a lower bill. You need to offer something that moves the needle for the business. You need to show value in a way that VMware doesn’t—because the platform itself isn’t where the pain is. The pain is in aligning with business priorities, scaling innovation, and simplifying multi-cloud and sovereignty strategies.

My Take

I’ve written before that VMware’s portfolio still has considerable potential. But let’s be honest, Cross-Cloud and Tanzu weren’t compelling enough to move the industry. The cracks in customer satisfaction aren’t in the tech stack; they’re in the ecosystem and execution.

If Broadcom truly wants to retain these customers, it needs to double down on the higher-value abstractions, developer experience, AI integration, sovereign cloud, and cloud economics. If they don’t, someone else will step in with just enough “good enough” infrastructure and a killer value prop up the stack. As part of my role at Futurum Group, we spent the day with Oxide Computer. A small but ambitious full-stack private cloud company that’s looking to make that exact argument.

Until then, don’t expect a mass VMware exodus. The tech’s not broken. The calculus now is all about business alignment.