“Effective April 30, 2024, the ability to transact as a VMware Cloud Services Provider, under the VMware Partner Connect Program, will come to an end,” a notice sent to partners reads, per The Register. So what is next for Cloud Service Providers after the end of the virtualisation and cloud computing partner programs?
Broadcom is transitioning VMware’s partner programs to the invitation-only Broadcom Advantage Partner Program, which seems to bring huge concerns and uncertainty to all cloud providers, except the huge ones. Drastic changes in the VMware business model were already anticipated by customers with the acquisition of VMware by Broadcom, as happened with previous acquisitions such as Computer Associates and Symantec where radical changes aimed at short-term return on investment with layoffs and redefined pricing policies, packaging, cancelling partner channel contracts , extinction of products and support model changes.
The End of VMware’s Partner Program – What’s Next for VMware Cloud Service Providers
Broadcom’s acquisition of VMware has led to major strategic changes in VMware’s operating structure. A key fact in this transition is the discontinuation of the “VMware Partner Connect” program. This decision has introduced a new level of uncertainty, particularly for Cloud Service Providers (CSPs).
Broadcom’s strategy involves a selective transition of certain solution providers and resellers to its scheme, beginning in February. This move has placed a large segment of VMware’s channel, especially CSPs, in a state of limbo. These CSPs, who are crucial in delivering VMware-based cloud services to smaller operations, were notified of the program’s termination by the end of April. The abruptness of this change has sparked concerns about their future ability to offer VMware-based services and the survival of these service providers.
Concerns for Cloud Service Providers’s Post-Program Termination
The industry’s reaction to the end of the VMware Partner Connect program has been marked by apprehension. Many in the sector speculate that Broadcom’s focus will be on retaining only the most profitable customers. This strategy could potentially sideline smaller users and providers, especially those with annual VMware revenues below $500,000, as reported by one of CRN’s sources. This approach seems to be a part of Broadcom’s broader strategy to streamline VMware’s offerings to suit its operational model, emphasising significant growth and revenue. This shift is seen as ironic, considering Broadcom’s initial claims of fostering increased competition in the cloud market.
“This all sounds very much like Broadcom taking an aggressive approach to its route to market and focusing on those partners that can deliver growth and significant revenue,” said Omdia chief analyst Roy Illsley to “The Register”.
Consequently, many smaller vendors risk losing their rights to operate VMware cloud services. This situation forces their customers to seek new providers, potentially leading to a greater concentration of customers with larger cloud providers and further market consolidation. Such a scenario starkly contrasts with the diverse ecosystem that the VMware Partner Connect program once nurtured.
For CSPs, the termination of the “VMware Partner Connect” program, which encompassed CSPs using products like vSphere and the extinct VCD (vCloud Director) in their IaaS models, has created significant uncertainty. With their direct relationships with VMware now in question, these providers are doubting their operational continuity and future IT partnerships.
In addition to the drastic change in partner program policy that is expected to disrupt the existing partner ecosystem, all previous verified certifications and programs offered by VMware for partners will be terminated, which can lead to the loss of trust and relationships established between VMware and them.
“I expect most VMware customers will be angry at the sudden termination of the way they’ve bought vSphere for the last two decades, and more so by the forced march to new products if they want support,” Gartner VP analyst Michael Warrilow told to “The Register”.
One of the Service Provider Partners told anonymously to “The Register” that his company was left in the dark with no indication whether they would be invited to the new partnership program:
“I don’t know how many smaller providers are affected by this, but it must be a very large number. The VCSP program was the only way for MSPs and service providers to offer a multi-tenant cloud service based on VMware.”
Avoiding Vendor Lock-in Post-VMware Program Changes
Following changes to the VMware Partner Program, cloud service providers (CSPs) are faced with the critical task of selecting new platforms, while being vigilant to avoid the risk of vendor lock-in again and pushing the problem into the future. Establishing a long-term plan is critical at this juncture to circumvent potential pitfalls associated with other solutions that can lead to lock-in. This scenario requires a thorough evaluation of possible alternatives, as a hasty decision in choosing a new vendor can result in such a restrictive dependency, if not more, than that experienced with VMware. This risk is especially pronounced for smaller CSPs, who may face limitations due to their reduced trading power and flexibility when dealing with larger and more dominant market operators.
As CSPs embark on this transition journey, a key strategy is to prioritise open standards and interoperability in choosing new platforms. Adopting open-source technologies like Apache CloudStack can be particularly advantageous in this regard. Apache CloudStack, known for its robustness and flexibility, provides CSPs with a comprehensive cloud management platform without the constraints of vendor-specific dependencies. This approach not only ensures a wider spectrum of options for the future but also equips CSPs with the agility needed to adapt to changing market demands and technological advances. In addition, CSPs must conduct full due diligence, assessing not only the technical prowess of potential platforms but also the contractual and commercial terms proposed by suppliers. By doing so, they can protect themselves from restrictive agreements that can impede their operational autonomy and innovation capacity, thus ensuring a sustainable and competitive stance in the cloud services market.
Apache CloudStack as VMware Alternative for Cloud Service Providers
For years, service providers have invested a significant portion of their IT budgets in licensing infrastructure with VMware’s portfolio. Previously, it was feasible to use VMware products like vSphere Standard and vCloud Director to design business solutions. However, with Broadcom’s recent changes aimed at simplifying the VMware product portfolio, the landscape has shifted.
“This should come as no surprise, but usually moves like this are to increase revenue. Expect pricing to go up. While Broadcom is touting lower prices for their Enterprise (VMware Cloud Foundation and VMware vSphere Foundation), pricing is certainly going up for smaller businesses with lightweight deployments. If you’re greenfield, this isn’t as noticeable, but if you’re already a VMware customer, and you’re utilising the vSphere Essentials or Essentials Plus licensing, expect to pay a lot more at renewal time.”
In light of the long-term uncertainties in the virtualisation market, particularly following Broadcom’s acquisition of VMware, Apache CloudStack has emerged as a serious competitor for organisations of all sizes seeking viable alternatives. This shift aligns with the recommendations of renowned institutes, which have highlighted the need for an ‘exit ramp’ from VMware solutions.
A key differentiator for Apache CloudStack is its unique ability to support multiple hypervisors within the same data centre. This versatility provides a significant competitive advantage, allowing organisations to adapt their infrastructure to diverse needs without being tied to a single hypervisor solution. This flexibility is particularly advantageous in the face of new challenges, where adaptability can lead to efficiency and optimisation of the IT budget.
To further strengthen its position as a mature alternative, recent versions of Apache CloudStack have introduced a set of features specifically designed to facilitate the migration of VMware environments. These include advanced tools that simplify the transition from VCD to CloudStack. For those considering moving completely away from VMware, CloudStack offers robust support for migrating vSphere virtual machines to the KVM hypervisor, making it a powerful tool for complete vendor lock-in removal.
These developments in Apache CloudStack demonstrate its commitment to meeting evolving market needs and underscore its position as a strategic choice for organisations navigating the complexities of modern virtualisation environments. By offering a flexible, hypervisor-agnostic platform, Apache CloudStack enables companies to make important strategic decisions about the evolution of their infrastructure, free from the constraints and uncertainties of vendor lock-in and market changes.
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