Broadcom Initiates Strategic Review for Two VMware Units Post $69 Billion Acquisition

Published: November 30, 2023 at 3:20 am Updated: November 30, 2023 at 3:20 am

Edited and fact-checked:
November 30, 2023 at 3:20 am

In Brief

U.S. chipmaker Broadcom plans to review strategic options for two business units within VMware i.e End-User Computing and Carbon Black.

Broadcom Initiates Strategic Review for Two VMware Units Post $69 Billion Acquisition

U.S. chipmaker Broadcom is set to assess strategic options for two business units within VMware, as revealed in a leaked email from CEO Hock Tan to employees, reported by an company insider to Reuters.

The $69 billion acquisition of cloud-computing firm VMware by Broadcom concluded on Nov. 22, following regulatory approval from China. The units under review are End-User Computing and Carbon Black, according to a Reuters report.

VMware plans to continue to operate with a structure comprising Cloud Foundation, Tanzu, Software-Defined Edge and Application Networking and Security. Raghu Raghuram, VMware’s top executive, will serve as a technical advisor to CEO Tan.

China’s State Administration for Market Regulation (SAMR) recently granted approval for Broadcom’s acquisition of VMware, marking a pivotal moment in the tech industry. However, SAMR had temporarily halted its probe from September 25 to November 17, extending beyond Broadcom’s desired closing date of October 30.

The delay had raised concerns about antitrust issues related to the deal, given VMware’s leadership in virtualization and Broadcom’s expertise in fibre channel host bus adapters (HBAs). The approval came with a stipulation that Broadcom ensures interoperability between VMware software and competing hardware, aligning with requirements from other global regulators.

Competitors such as Nutanix and Oxide are capitalizing on these developments, highlighting Broadcom’s track record of aggressive asset maximization and potential price hikes. They are slowly positioning themselves as viable alternatives to VMware, particularly as customers and employees express apprehensions about impending changes.

Broadcom’s strategic bet on VMware’s multi-cloud management capabilities indicates a focused approach. The commitment to channel partners signals an intention to support a diverse customer base.

However, as the tech landscape undergoes rapid evolution, VMware’s position faces challenges from emerging technologies and shifting customer preferences.

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Victor is a Managing Tech Editor/Writer at Metaverse Post and covers artificial intelligence, crypto, data science, metaverse and cybersecurity within the enterprise realm. He boasts half a decade of media and AI experience working at well-known media outlets such as VentureBeat, DatatechVibe and Analytics India Magazine. Being a Media Mentor at prestigious universities including the Oxford and USC and with a Master’s degree in data science and analytics, Victor is deeply committed to staying abreast of emerging trends.
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Victor Dey