Some enterprises are dropping VMware, just not all at once

While the predicted mass exodus from VMware hasn’t materialized, many enterprises are actively reducing their VMware footprint, a new survey shows.

Broadcom’s 2023 acquisition of VMware prompted forecasts that enterprises would rethink their virtualization strategies amid fears that VMware license costs would triple.

So far, though, only 14% of enterprises questioned have so far seen prices double, while 59% saw prices rise by more than 25%, according to a survey commissioned by cloud cost optimization and management firm CloudBolt.

However, 88% are worried about VMware license price increases in the future, and as a consequence, 86% are reducing their use of VMware, according to the survey, conducted in January 2026 among 302 IT decision-makers in North American enterprises with 1,000 or more employees.

That the license price increases are less than initially feared is little consolation, CloudBolt wrote in a blog post discussing the survey results: “When the bully only takes half your lunch money instead of all of it, you don’t feel grateful. You still got robbed.”

Enterprises aren’t making a wholesale switch away from VMware. Instead, they say they’re shifting away workload by workload. “The predicted stampede became a calculated retreat,” said CloudBolt. And, it said, Broadcom had planned for this.

Scott Bickley, advisory fellow at Info-Tech Research Group, agreed, saying that if Broadcom held on to just its top 10,000 VMware customers, that would be more than sufficient for it to meet its revenue and profitability goals over the next three years. “Keep in mind that VMWare has over 400K accounts, so the core business case was predicated on retention of the largest 3% of accounts,” he said.

Customers may view the price increases differently depending on how much of the licensed software they use, because the value of VMware Cloud Foundation (VCF) is maximized when all of its components are used, said Matt Kimball, VP and principal analyst at Moor Insights & Strategy. “The less it is used, the more expensive the platform will seem,” he said. “If I am a legacy VMware customer only interested in vSphere, my price increase will seem incredibly high. Conversely, if I’m using VCF to its fullest extent — virtualization, cloud, security, networking, modern apps, AI, and so forth, then that value is fully realized.”

Disruption level has declined

While 88% of the survey respondents are still finding the acquisition disruptive, the disturbance is becoming less severe; in 2024, 46% said it would be extremely or very disruptive, compared to 25% in 2026. Their top worries are about price increases (89%), uncertainty about plans (85%), and the quality of support (78%).

And although 60% report higher confidence in their VMware strategy than in 2024, 63% have changed that strategy two or more times over the two-year period.

CloudBolt wrote, “Two years in, IT leaders have stopped asking ‘Will this hurt?’ and started asking ‘What does it take to get out?’”

Almost three quarters (72%) are migrating workloads to public cloud IaaS, 43% to Hyper-V/Azure stack, and 34% to SaaS replacements.

No easy escape

However, said Greyhound Research chief analyst Sanchit Vir Gogia, “VMware is embedded beneath ERP systems, clearing systems, healthcare environments, manufacturing control systems, and regulated workloads. Migration from that layer is a multi-year program, not a procurement switch.”

Kimball agreed. “There is no such thing as a frictionless migration,” he said, “from VMware to an alternative, or from any private cloud platform to another.  But this is especially true for VMware environments that have been operational for years, even decades. There is so much untangling to do — technically, operationally, organizationally — so much so that these indirect costs are quite burdensome.” 

So while 44% of respondents reported that they have so far migrated 25% or more of their environment away from VMware, only 2% have shifted 75% or more.

Thus, said CloudBolt, “The exodus is happening — just in slow motion. Organizations aren’t finding easy escapes. The top deal-breakers: migration complexity/risk (25%), higher costs than expected (23%), and technical limitations (21%). But here’s the silver lining: 62% say these obstacles are “challenging but doable” — not impossible. The path exists; it’s just longer than anyone hoped.”

This didn’t surprise Gogia. “The reason only a small percentage of enterprises have completed full exits is not because satisfaction returned. It is because dependency remains deep,” he said. “Migration requires architectural redesign, security validation, compliance re-certification, skills retraining, and cost modelling across hybrid environments. Renewal cycles typically run three years. That alone mathematically prevents rapid departure.”

Executive pressure to act has increased for 41% of respondents, with the most-cited sources of pressure being the CEO (19%), the board (16%) and the CFO (15%), CloudBolt said.

A slow erosion

For VMware’s future, said Gogia, “The structural risk is subtle. If Broadcom optimizes around the largest ten thousand accounts while allowing long-tail attrition and partner contraction, VMware may remain highly profitable while gradually losing default choice status for new workloads.”

And, Bickley said, many organizations lack the resources to do quick migrations, so will likely be forced into at least one three-year renewal term with VMware. So, “yes, the long tail of VMware customers will slowly migrate away from the platform, but this process will take years to unfold,” he said.

But Kimball isn’t as sure. “I can appreciate a lot of what Cloudbolt says, and agree with this ‘the revolution is more of an evolution’ storyline,” he said. “But I think it’s still a little too early to tell how big the migration path from VMware will be.”

This article first appeared on Network World.