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Why some VMware customers pay for upgrades they never use
The sheer complexity of migrating off VMware is one of the reaons some organisations continue their VCF subscriptions
A growing number of VMware customers are doing something that looks contradictory on paper: renewing their VMware Cloud Foundation (VCF) subscriptions in full, then declining to take the very upgrade those subscriptions exist to fund. They are paying for VCF 9, but they are not installing it.
It's a pattern I've watched grow steadily since the Broadcom acquisition, and it isn't a handful of stragglers waiting out a compatibility issue. It's a consistent category of customer behaviour in its own right, sitting somewhere between full migration and full commitment to VCF 9.
You might expect the explanation to be technical: a workload that isn't ready, a compatibility issue, a migration too complex to schedule on Broadcom's timetable. There's some truth in that. The obstacles most frequently cited by customers are migration complexity, higher-than-expected alternative costs, and technical barriers. But the concern that ranks above all of those is price: 85% remain worried about further increases, and three in five have already seen renewal costs rise by more than a quarter. Technical readiness explains why some migrations are slow. It doesn't explain why so many customers aren't attempting one at all. What customers are really weighing has little to do with whether VMware still works. It is a question of whether to commit to Broadcom's subscription now, on terms that could look very different by the next renewal, or to hold that decision open for as long as the 2027 deadline allows.
That change in direction has a starting point. Broadcom completed its acquisition of VMware in November 2023, and within weeks had stopped selling perpetual licences altogether: every VMware product would be sold as a subscription from that point on, bundled predominantly into VCF. Broadcom also offered VMware vSphere Foundation (VVF), a lighter version of VCF, before withdrawing it from certain markets. Existing perpetual licences weren't revoked, but the support attached to them now had a fixed shelf life rather than an open-ended one. At the time, that looked like a licensing technicality. It is now the deadline shaping almost every conversation customers are having about VMware's future.
A deadline with one official answer
That deadline has a fixed point: 11th October 2027, when general support ends for vSphere 8, the last VMware release still available on a perpetual licence. From that point, the only supported route forward is VCF 9, sold exclusively as a subscription, that finance teams hadn't planned for, and infrastructure teams hadn't requested. There was only one officially sanctioned choice: move onto Broadcom's private cloud platform or lose support entirely.
But that's Broadcom's version of the choice. It isn't the only one available. Independent, vendor-agnostic support exists specifically to keep vSphere 8 environments running safely past that date. New security exposures continue to be identified, assessed, and mitigated while the environment remains fully operational, with no requirement to deploy VCF 9. A customer can renew its Broadcom subscription, technically staying current on paper, while the environment doing the work stays on vSphere 8 under independent support. Nothing forces those two things onto the same timeline. The subscription satisfies Broadcom. The support arrangement keeps the business running. Broadcom's deadline doesn't disappear, but it stops being the thing that decides when the money gets spent.
That's exactly the position a growing number of organisations have settled into: not a stopgap before a migration everyone assumes is coming, but a genuinely open-ended arrangement, held for as long as VCF 9’s case for that specific business remains unproven.
The scale of this shows up in Broadcom's own numbers, too. On paper, this paradox of paying for a replacement with no plan to install it looks like a minority habit: more than 90% of VMware's 10,000 largest accounts have adopted the platform, investors have been told, up from 87% just one quarter earlier.
But on those same calls, Broadcom's own CEO has drawn a line between adoption and reality, telling investors directly that a licence bought is not the same thing as a workload deployed at scale. One Forrester analyst has gone further, calculating that the average customer is now renewing only around a quarter of their total VMware estate, even as headline adoption numbers climb. And the top 10,000 accounts, however large individually, are a narrow slice of a customer base numbering in the hundreds of thousands. What looks like near consensus at the top of that list looks considerably less settled the further down it you go. Put plainly: renewing the subscription and declining the upgrade isn't a fringe case.
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When frustration goes public
Most customers can still choose to renew, hold off on deployment, and keep their environment running under independent support while they decide what comes next. Tesco shows what happens when that choice gets forced anyway.
Tesco's original VMware contract, covering perpetual licences for vSphere Foundation and Cloud Foundation plus support through January 2026, predates the Broadcom acquisition. When it expired, Broadcom refused to extend standalone support without Tesco signing on to VCF 9. One offer priced a single year of VCF 9 and mainframe support at $23.5 million, which Tesco calculated as a 175% increase on VMware pricing and 350% on its mainframe agreement. Tesco rejected it, and filed a claim in the UK courts against Broadcom, VMware and Computacenter in 2025 seeking damages of at least £100 million, arguing the changes had effectively voided licences it had already paid for.
So what did Tesco do next? It didn't accept Broadcom's terms, and it also didn't go without support. It hired independent providers to keep its VMware estate running while it works through a full migration off VMware, targeted for the end of 2027. It's the same model: independent, vendor-agnostic support keeping a VMware estate running without a Broadcom subscription behind it. Tesco is just applying it under harder conditions, without the option of holding indefinitely, because it has already decided the destination is a full exit rather than an open-ended pause.
AT&T’s case followed a similar story, but with a different conclusion. It filed suit in New York in August 2024, alleging Broadcom was retroactively rewriting licences it had already paid for and demanding hundreds of millions of dollars in bundled commitments it hadn't asked for. The case reached a settlement in principle three months later, before trial.
These are two large, well-resourced customers, faced with the same problem, and making the same initial call: contest the terms rather than accept them.
A decision, not a delay
It’s tempting to read the far more common choice for most customers in this bind – renewing and declining to deploy – as stalling. It isn't. It's the same mechanism Tesco is using in public, applied earlier and with less friction: keep the environment that already works running under independent support, and use the time that buys to decide, on your own schedule, whether VCF 9 is where the next pound of capital should go.
That answer doesn’t undo the eventual decision. It changes who sets the timetable for making it. For as long as independent support keeps the environment fully operational, that timetable belongs to the customer, not Broadcom.
The 2027 deadline is real, and it isn’t moving. But on its own, it doesn't decide whether these organisations modernise their infrastructure. It decides who controls the pace of that decision: Broadcom, through its subscription terms, or the customer, through support options Broadcom has no ability to withdraw. A growing number of organisations have already made that choice and are paying to stay on their preferred infrastructure for as long as it takes to be sure.
Shane O’Rourke, is vice president, global support services, VMware at Spinnaker Support
