Software Support Provider Offers Alternative Amid Broadcom's VMware vSphere 7 Deadline

Third-Party Support Emerges for VMware vSphere 7.x Users

A significant development in the enterprise software support landscape has seen Spinnaker Support announce indefinite third-party support for VMware vSphere 7.x. This initiative directly addresses the approaching end-of-general-support (EOGS) deadline set by Broadcom (AVGO) for vSphere 7.x, scheduled for October 2, 2025. The move provides an alternative for customers wary of Broadcom's revised licensing models and perceived price escalations following its acquisition of VMware.

Broadcom's Strategic Shift and Market Impact

Broadcom's acquisition of VMware has ushered in substantial changes to its product offerings and pricing structures. The most prominent shifts include the elimination of perpetual licenses in favor of mandatory subscription models and the bundling of previously separate products, primarily into the VMware Cloud Foundation (VCF). This strategic pivot has resulted in considerable cost increases for many customers, with reports indicating renewal price hikes ranging from 100% to 800%, and in some extreme cases, exceeding 1000%. These changes have disproportionately affected small and medium-sized enterprises, creating an urgent need for re-evaluation of their virtualization strategies.

After the October 2025 EOGS date, organizations continuing on vSphere 7.x without alternative support face critical risks, including the absence of product support services, security patches, updates, and access to Broadcom's technical assistance. This exposure can lead to heightened security vulnerabilities, potential compliance violations, and increased risk of system downtime.

Customer Dissatisfaction Fuels Alternative Adoption

Broadcom's post-acquisition strategy has generated widespread dissatisfaction among its customer base. The abrupt transition to subscription-based models and the significant price increases have led many organizations to seek alternatives. Telefónica Germany, for instance, shifted its VMware support to Spinnaker Support after receiving a renewal quote from Broadcom that was five times its previous cost.

Holger Berndt, Professional Lead for Software Asset Management at Telefónica, stated: "Our offer from Broadcom was five times higher than we expected." He further added, "We never thought to go away from VMware until Broadcom [came] up with this new solution, and we are not angry with Broadcom, but it's not acceptable. It's not acceptable what they're doing at the moment, that they tell you that you are the one of the valuable customers, and then they do this."

Market data corroborates this sentiment, with a notable decline in VMware's Net Score, a metric reflecting customer spending intentions, from 30% in January 2022 to essentially 0%. Customer churn rates have also risen from low single digits to 14%, indicating a significant number of customers are either leaving the platform or isolating their usage.

Broadcom's Focused Execution and Financial Performance

Despite the customer backlash, Broadcom's strategy appears to be yielding financial benefits. The company is actively narrowing its focus to high-value customers who are willing to adopt the full VCF stack, effectively pruning non-aligned customers from its portfolio. Broadcom CEO Hock Tan has emphasized this focus, stating, "We see the top 10,000 [customers] as being people where it makes a lot of sense to derive a lot of value in deploying private clouds using VCF." Broadcom reports that approximately 70% of its top 10,000 customers have migrated to VCF, and over 90% of its vSphere customers have purchased VCF.

The financial results highlight the impact of this strategy: Broadcom Software reported a $26.8 billion run rate in March 2025, representing 45% of total revenue with 47% growth, a substantial increase from VMware Software's $12.4 billion run rate and 3.1% growth in May 2022. Gross margins for Broadcom Software have risen to 92.5% from VMware's 83%, and operating margins have surged from 25% (standalone VMware) to 76% (Broadcom Software), underscoring significant cost discipline and a focus on higher-value engagements. Broadcom's Infrastructure Software segment, predominantly VMware, generated $6.8 billion in its recent third quarter, marking a 17% year-over-year increase.

Industry analysts note Broadcom's consistent execution on its strategic plans.

"Broadcom's consistent execution has validated its strategic plan and strengthened its reputation on Wall Street," according to a Breaking Analysis report. "The transition to a subscription-based model—while abrupt for some—reinforces Broadcom's broader ambition of extracting higher margins and focusing on profitable, core technology areas."

Future Outlook and Market Diversification

Looking ahead, the market for virtualization and cloud infrastructure is poised for further diversification. Broadcom's aggressive strategy, while profitable for the company, continues to motivate customers to rationalize their VMware portfolios. Many are either isolating core workloads on VCF or exploring alternatives for non-core functions. Competitors such as Nutanix (NTNX), Microsoft, and Scale Computing, as well as public cloud providers like Amazon Web Services, Microsoft Azure, and Google Cloud, are actively courting disgruntled VMware customers. Solutions like IBM Cloud for VMware solutions are also presenting strong ROI figures.

The emergence of third-party support options like Spinnaker Support provides a crucial buffer for organizations unwilling or unable to transition immediately to Broadcom's new models. This dynamic underscores a shifting landscape where customer choice, cost-efficiency, and vendor flexibility are becoming paramount considerations in enterprise IT infrastructure decisions.