Broadcom is kicking some cloud service providers (CSPs) out of the VMware channel partner program, bringing uncertainty for the technological and financial futures of numerous businesses, especially small-to-medium-sized ones.
As reported by The Register today, Broadcom this week revealed to VMware CSP partners that it is launching a new invite-only channel program for CSPs on November 1. Fewer CSPs are expected to be eligible for this new program. The Register said that “some mid-size partners won’t be invited to the new program."
Current VMware CSPs that didn’t receive an invite for the new program by today have reportedly been cut and will receive a notice of non-renewal.
CSPs that are getting booted are allowed to continue conducting business as normal until October 31. Afterward, those CSPs and the organizations whose VMware-based deployments they serve will be heavily impacted. As explained by Australian IT service provider and VMware CSP Interactive, companies currently using VMware tech through a CSP that's being cut will have to find a new way to renew VMware licenses and may see “delays or confusion” amid service and renewal requests and changes to the support and service they receive. Furthermore, prices could go up since partner consolidation could lead to “additional costs for migration and re-onboarding and reduced bundling options that previously allowed for greater cost efficiencies,” Interactive said.
White-label program ending
Since acquiring VMware, Broadcom has been shrinking the number of businesses that are eligible to resell and provide support for VMware offerings. In January 2024, it replaced the old VMware partner program with an invite-only one, the Broadcom Advantage Partner Program, and shed many partners. Broadcom also cut business ties with many CSP partners by requiring CSP members of its new partner program to operate at least 3,500 processor cores. In March 2024, The Register reported that “hundreds” of CSPs weren’t invited to Broadcom’s new program. VMware had over 4,000 small CSP partners before Broadcom’s acquisition, The Register previously reported.
Broadcom subsequently launched a white-label program allowing smaller CSPs to work through CSPs that were still VMware partners, but that program is also shuttering on October 31.
Businesses relying on cloud platforms based on VMware tech licensed through the white-label program could suddenly be forced to migrate hastily, which has inherent risks, including high costs.