Broadcom sends cease and desist letters to owners of perpetual VMware licenses.
The new owner of VMware is urging holders of old licenses to purchase expensive subscriptions for software support. Broadcom has indicated that it may conduct audits of VMware users to ensure compliance with regulations.
Broadcom has started sending cease and desist letters to owners of perpetual VMware licenses with expired support contracts. After acquiring VMware in November 2023, Broadcom decided to suspend the sale of perpetual VMware licenses. Although users who hold these licenses can continue to use the purchased software, they cannot renew support services unless they have a prior agreement that allows them to do so. This measure has faced criticism, as it aims to incentivize VMware users to acquire subscriptions to VMware product bundles, whose costs have seen increases of up to 300% or more in certain cases.
Some customers have chosen to continue using VMware without support while evaluating alternatives, including competitors of VMware or devirtualization solutions. In recent weeks, several users operating VMware without support have reported receiving cease and desist letters from Broadcom, informing them that their contract with VMware has expired, along with their right to receive support services.
In these letters, signed by Broadcom's CEO, Michael Brown, users are ordered to cease the use of any updates, enhancements, or patches issued since the expiration of their support contract, except for critical security patches. It is mentioned that the implementation of such updates after the expiration date must be uninstalled immediately, and using support after this date could constitute a breach of the agreement with VMware, potentially leading to claims for damages and legal fees.
Some clients of Members IT Group, a managed services provider in Canada, have received these letters, despite not having received updates from VMware since their support contracts expired, as noted by CTO Dean Colpitts. One client received a letter just six days after their support contract had expired.
Additionally, users in online forums have pointed out that they received these letters despite not having made updates since losing VMware support. One user in the Spiceworks forum reported receiving a letter even after migrating to Proxmox.
A number of users who received Broadcom’s letter decided to involve legal teams. Some expressed their confusion online, believing that the letter implied Broadcom considered they had breached their agreement with VMware. However, it seems Broadcom is sending these letters shortly after support contracts expire, regardless of whether users continue to use VMware or not.
The letter also warns that recipients could be subject to audits, where non-compliance with certain reporting requirements after expiration could result in a breach of the agreement by the client. Colpitts noted that his main concern is preventing his staff from accidentally applying patches to clients, as many of them are now using VMware without support.
Since Broadcom ended the perpetual VMware licenses and raised prices, several users and business partners, particularly small and medium-sized enterprises, have had to reduce or terminate their business relationship with VMware. Although Broadcom's financial success since the acquisition of VMware suggests its business plan will remain robust, sending cease and desist letters to VMware users jeopardizes its reputation among current and former clients.