For the last 18 months, the VMware community has been struggling to read the tea leaves of the impending Broadcom acquisition. Despite assurances to the contrary, customers’ and partners’ worst expectations have been fulfilled. VMware Customers are seeing 3x, 5x, and even 10x price increases. Partners have been terminated while being asked to submit a request to become a partner again. For VMware EUC customers, the saga is not over yet. Broadcom has just sold off the EUC division to private equity firm KKR and the deal will be finalized in the next few months.
What can customers expect from KKR? Unfortunately, it is likely to be more of the same – after all, Broadcom has been called a private equity disguised as a software company. Ironically, KKR is the firm that led the buyout of RJR Nabisco. The story was made into a book and movie called “The Barbarians at the Gate”. In the book, an executive called KKR’s money “phony” and stated, “We need to push the barbarians back from the city gates”.
The old adage goes: “When your only tool is a hammer, everything looks like a nail”. The only tool private equity is adept at is a spreadsheet. Therefore we are likely to see more of “management by spreadsheet” – as opposed to the management by “walking around” championed by Hewlett-Packard in the 1970s.
Now do not get me wrong! Spreadsheets are useful tools but should not be used to drive a company’s strategy. It is too easy to build a spreadsheet model where if one slashes the sales and marketing teams and increases the price of a product by 10x, the result is financially attractive – even if many customers abandon the product. However, does the spreadsheet factor in the ill will of the customer community? Does it factor in the fact that the brand becomes toxic? Clearly, Broadcom has been financially successful. Will it continue or will it end up like GE – a conglomerate that had to shed all its parts?
The good news is that nature does not like vacuum and many solutions are emerging to fill in the void left by VMware EUC. At Apporto, we have introduced our NextGen product which in many ways is superior to VMware Horizon. Customers can run Apporto NextGen on their existing hardware (the same hardware that previously was used for VMware) or in the cloud. Better yet, customers will be charged a subscription fee equal to last year’s VMware support fee. If you are a VMware customer feeling stranded, please grab this lifeline.
Download this detailed vendor comparison matrix to understand the differences between Apporto and VMware Horizon.
