Significant Price Increase Drives Company to Transition from VMware to Open Source Alternatives

A rising number of companies are reevaluating their reliance on VMware following Broadcom's acquisition, which has resulted in substantial price hikes and other contentious changes. One notable example is Beeks Group, a cloud service provider based in the United Kingdom, which has transitioned the majority of its extensive virtual machine (VM) inventory--over 20,000 units--from VMware to OpenNebula, an open source platform for cloud and edge computing.

Beeks Group specializes in providing virtual private servers and bare metal servers to clients in the financial services sector. While some VMs still operate on VMware, the company has shifted a significant portion to the OpenNebula framework. Matthew Cretney, the head of production management at Beeks, indicated that the switch was prompted in part by a staggering increase in VMware licensing costs, which he described as being ten times the previous amounts.

By adopting OpenNebula, Beeks has reportedly been able to allocate more of its fleet of 3,000 bare metal servers to client workloads rather than VM management, which had been a requirement under VMware's system. The company has noted a 200 percent improvement in VM efficiency, attributing this to the reduced overhead associated with OpenNebula.

Furthermore, Beeks has observed a diminishing perception of VMware as a critical resource among its customers, alongside a decline in the support and innovation traditionally associated with VMware services. These factors have contributed to Beeks' decision to migrate away from VMware.

Broadcom has yet to comment on the situation, but the company appears to be facing challenges in retaining VMware's legacy customer base. Many organizations are reportedly exploring alternative solutions due to the recent price increases and changes in VMware's licensing policies. These shifts have led to a growing sentiment of mistrust towards VMware and other vendors offering proprietary solutions.

Several other companies have echoed Beeks' frustrations, noting drastic increases in costs associated with VMware services since Broadcom's acquisition. For instance, AT&T previously reported that Broadcom proposed pricing changes that would increase their VMware costs by approximately 1,050 percent. Although AT&T initiated legal action against Broadcom concerning the non-renewal of perpetual license support, the two parties have since reached a settlement.

In response to the backlash from small- and medium-sized businesses, Broadcom introduced a new subscription tier aimed at making VMware offerings more accessible. However, this initiative has not fully mitigated concerns that the company is primarily catering to larger enterprise clients, leaving smaller organizations feeling overlooked.

The trend of companies migrating away from VMware is expected to continue as organizations seek to manage rising operational costs and explore more flexible and cost-effective solutions. Beeks Group's experience highlights the ongoing challenges Broadcom faces in addressing customer dissatisfaction and retaining loyalty in a competitive cloud services market.

As companies continue to navigate these changes, the shift towards open source alternatives like OpenNebula may gain further momentum, providing businesses with the tools they need to optimize their operations while minimizing costs.