Editor’s note: The following is a guest post by Alex Tatham, IT channel consultant and non-executive director at IT manages services provider Novatech.
Next month marks three years since Broadcom completed its acquisition of VMware, yet many customers are just now reaching their first major renewal decision.
Existing multi-year agreements shielded customers from changes to the virtualization software provider’s licensing, subscriptions and product portfolio. As those agreements come up for renewal, IT service providers have an opportunity to advise customers grappling with whether to stick with VMware, reduce their footprint or migrate to an alternative. The decision should be based on what makes operational and financial sense.
The worst time to start discussing alternatives to VMware is when a customer's renewal deadline is weeks away. By then, there may be little opportunity to properly assess the estate, test alternative platforms or build a migration plan without introducing unnecessary risk.
Service providers should talk to customers well before that point, using the renewal as a trigger for a broader infrastructure review. That means understanding which workloads run on VMware, which capabilities customers rely on and where there may be opportunities to consolidate, retire or move workloads.
This conversation has moved beyond IT. Increases in recurring infrastructure costs attract the attention of finance and executive teams, particularly when the spending competes with investment in cybersecurity, cloud, AI or other business priorities. Customers may already be asking at the board level whether their existing infrastructure strategy delivers good value.
The channel should be ready to help answer that question rather than simply present the renewal paperwork.
Stay, downsize or migrate?
For some customers, staying with VMware will remain the right answer. If the platform is stable, the workloads are closely tied to its capabilities and the revised commercial terms are acceptable, the cost and disruption of moving may simply not be justified. The key is to establish that through analysis rather than assumption.
An assessment should look beyond licensing to the total cost of ownership, including infrastructure, support, skills, management, security and operational risk. It should also account for the cost of moving to an alternative platform.
A customer may not need to choose between full renewal or complete migration.
Virtualization estates often contain development and test environments, legacy applications and workloads that are no longer business-critical. A renewal is an opportunity to identify what can be retired or consolidated and reduce the overall VMware footprint. In some cases, a smaller VMware environment combined with another platform may deliver the best balance of cost, capability and flexibility.
Clear signals indicate when a customer should consider a fundamental change. Substantial increases in recurring costs are a red flag, especially when a larger VMware bill doesn't correspond to additional value. Relatively portable workload estates make the decision to migrate easier, especially when applications don't depend heavily on proprietary VMware capabilities or complex integrations.
A customer's internal capabilities matter. Organizations with the skills, infrastructure and partner support to operate an alternative platform are likely to face fewer barriers to migration.
There are strategic questions around vendor dependence. Some businesses may decide that reducing reliance on a single infrastructure provider is worthwhile even if the immediate financial saving is not dramatic. A lesson from the past three years is that vendor lock-in becomes most visible when commercial terms change. Having alternatives can provide both financial flexibility and greater negotiating leverage.
But channel firms should resist the temptation to guarantee post-migration cost savings. A credible business case must include the costs of assessment, design, implementation, training and ongoing management, as well as the potential savings. If the numbers only work by ignoring the transition's cost and complexity, it is not a strong business case.
Migration doesn't have to mean disruption
Operational risk remains a barrier to change. Customers are right to worry about what happens when VMware workloads move to a new platform.
Successful migrations don’t have to happen all at once.
A sensible approach is usually phased. Start by assessing workloads and identifying suitable proof-of-concept candidates. Move lower-risk systems first, build confidence and experience, and then decide which business-critical workloads should follow.
Backing up data during migration and restoring it effectively is an important consideration that can spur conversations about efficiency and cost savings.
Coexistence is a strategy to consider. Keeping VMware operational alongside an alternative platform during a migration gives customers control over the pace of change and reduces the pressure to make one large, irreversible decision.
For service providers, this is where the channel's value becomes particularly clear. The opportunity is not simply to sell a different virtualization platform, but to provide the assessment, architecture, migration expertise and ongoing support needed to make the right infrastructure decision. Training is fundamental, but for a reseller that has lost access to VMware renewal fees and partnership, there's no better time to skill up for the sake of customers.
Don't let renewals dictate strategy
VMware customers are questioning infrastructure decisions that once seemed almost permanent. That is a healthy development. VMware remains a mature and capable enterprise platform. But a business's years of reliance on VMware should not determine what it does next.
For the channel, treat the renewal as a strategic checkpoint rather than an administrative exercise. The best service providers will help customers look honestly at the numbers, the workloads and the operational realities.
Channel firms should help customers plot out an infrastructure strategy. For some, that will mean renewing VMware despite a significant cost increase. For others, it may mean reducing their footprint or starting a migration. The key is to base the decision on the business's needs, rather than simply following the same path because it is familiar.
