European CIO associations sound the alarm about Broadcom's behavior MARCH 29, 2024 - 11:27 3 MINUTES READING TIME CURRENT CLOUD & INFRASTRUCTURE BROADCOM, CIO,PLATFORM, NETHERLANDS, VMWARE
By: Diederik Toet
Four European interest groups of CIOs, including the CIO Platform Netherlands, express their concerns about Broadcom's behavior after the acquisition of VMware in an open letter to the European Commission. According to the organizations, this behavior leads to a disruption of the virtualization market. They call on the committee chairman to intervene to protect European companies against such practices.
CIO Platform Netherlands, the Belgian Beltug, the French Cigref and the German Voice criticize chip manufacturer Broadcom for its actions. According to them, this goes against the principles of fair competition and has a negative impact on their members, including through sudden price increases, failure to comply with contractual agreements, and res trictions on license sales and maintenance.
In the urgent letter (pdf), the interest groups write that many members are dependent on VMware products and fear reprisals in the event of legal action against the supplier. They ask committee chairman Ursula von der Leyen to take action against 'this disorder in the virtualization market' and protect European business users of VMware.
The associations had already warned the European Commission during its investigation into the takeover. At the time, CIO Platform Nederland wrote: 'Our members mainly fear a sharp price increase that will be forced on them by new pricing models (for example by exchanging a licensing model for perpetual use for a subscription model), or deteriorating contract conditions, which Broadcom could enforce due to its dependence on our members of VMware products. This happened, for example, after the acquisition of Symantec by Broadcom.'
Wider The four CIO associations extend the problem beyond just the acquisition of VMware by Broadcom. According to them, the European Commission must act to prevent other providers from following suit. “Broadcom's approach should not become a precedent.” They also warn that Broadcom's reining in of VMware, a major player in private cloud computing, could trigger a shift to the public cloud. This is empowering hyperscale cloud providers and affecting Europe's digital future.
In November 2023, Broadcom received the green light for the acquisition of VMware. It had taken almost a year and a half to get approval from regulators worldwide, including the European Union and China. There were many concerns about competitive distortions. The acquisition is an important diversification step for Broadcom outside the chip market and strengthens its position in the data center market by integrating VMware software, which facilitates companies to operate more efficiently in the multi-cloud. The Singaporean chip manufacturer put $61 bi llion on the table for the virtualization specialist.
Not long after the acquisition was finalized, the first reports appeared about the harsh manner in which Broadcom, led by CEO Hock Tan, is sweeping through the VMware ecosystem. Within a week, the first VMware employees were notified of their contract. In January, the company decided to cut VMware's partner channel and group of distributors, potentially throwing out half of its four thousand partners worldwide. Rates are also being increased and the group is trying to say goodbye to smaller customers who yield little margin.
Computable has asked Broadcom for a response, but has not yet received one.
[link]< /span> [comments]]]>
☞ El artículo completo original de lo puedes ver aquí
No hay comentarios.:
Publicar un comentario