Two years after Broadcom acquisition: VMware exodus fails to materialize

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The feared mass exodus of VMware customers has not materialized. According to a recent survey by CloudBolt, conducted in January 2026 among 302 IT decision-makers in North American companies with at least 1000 employees, only 4 percent have completely replaced their VMware infrastructure so far. However, 86 percent of respondents are actively reducing their VMware usage – Broadcom's acquisition and the associated changes are still having a negative impact.

The study, which takes stock two years after the Broadcom acquisition, reveals a clear discrepancy between expectation and reality. While 73 percent of respondents feared a doubling of costs or more in 2024, only 14 percent actually experienced price increases of over 100 percent. The majority (59 percent) recorded increases in the range of 25 to 49 percent. However, IT managers reported extreme increases between 350 and 700 percent in individual cases.

The impact on European cloud providers is particularly evident. For example, the EU cloud association CISPE has documented price increases of 800 to 1500 percent. After the acquisition, Broadcom fundamentally changed its licensing policy: Perpetual Licenses were abolished, and instead, only subscription models with bundled products and core-based billing are available.

Slow migration instead of rapid exodus

The reasons for the non-existent mass exodus are diverse. 25 percent of respondents cite the complexity and risk of migration as the main obstacle, 23 percent refer to unexpectedly high costs. Another 21 percent encounter technical limitations. The typical duration for resolving dependencies is stated as 18 to 24 months. The study quotes an IT director as an example: "The process of resolving a decade of process dependencies takes 18 to 24 months."

Of the companies that have migrated workloads, 72 percent switched to public cloud IaaS offerings. Hyper-V and Azure Stack accounted for 43 percent, SaaS solutions for 34 percent. Alternatives to VMware mentioned include Nutanix AHV, Proxmox VE, Red Hat OpenShift Virtualization (KVM), SUSE's Harvester, and OpenStack. Notably: 63 percent of respondents have changed their VMware strategy at least twice since the acquisition.

Trust increases despite disruptions

Also noteworthy: 60 percent of respondents report higher confidence in their VMware strategy compared to 2024. The study interprets this as a transition from panic to pragmatic execution – a kind of acceptance phase after the initial shock. While 46 percent still found the Broadcom acquisition extremely or very disruptive in 2024, only 25 percent do in 2026.

However, pressure from management has increased: 41 percent report increased engagement from CEOs and CFOs in VMware decisions. The virtualization strategy has thus become a board-level issue. One IT manager described the pressure drastically: "1000 percent pressure – it could cost you your job."

Broadcom strategy focuses on squeeze

The study concludes that Broadcom is deliberately calculating customer churn and instead maximizing margins with remaining customers. 85 percent of respondents expect further price increases. The slow exodus leads to a "squeeze": as the customer base shrinks, prices for those remaining will continue to rise. Gartner forecasts a decline in VMware's market share from around 70 percent (2024) to about 40 percent (2029).

New challenges arise from increasing multi-platform complexity: 52 percent of respondents see this as a problem, 33 percent complain about a lack of expertise in their teams. At the same time, 65 percent report an improved risk profile due to the diversification of their infrastructure. Details on all collected data can be found at CloudBolt.

(fo)