$500,000 Filter: Broadcom’s Selective Invite to VMware’s Reseller Party

As previously revealed, following Broadcom’s acquisition of VMware, the company has decisively terminated VMware’s original perpetual license sales model, transitioning entirely to a subscription-based model. Broadcom has further confirmed that it plans to terminate existing distributor and service provider partnerships with VMware as of February 4, 2024. All former collaboration agreements will require re-signing with Broadcom.

In this new partnership model, re-signing will be conducted through the Broadcom Advantage Partner Program. However, this opportunity will be limited to specific sales partners that meet eligibility criteria. According to sources, Broadcom will only re-sign with sales partners who have achieved a sales volume of over $500,000. Partners falling below this threshold will not have their contracts renewed.

The majority of existing distributor and service provider partnerships with VMware are set to be terminated after January 2024, with some contracts concluding in April 2024. Only a select few distributors and service providers will likely be able to continue their collaboration with Broadcom.

Some small-scale distributors have expressed dissatisfaction, highlighting their long-standing relationships with VMware, despite not having high sales volumes. These relationships often involve multi-year licensing agreements. Broadcom’s brief timeframe for addressing these matters and its decision to re-sign only with certain partners are expected to have significant repercussions.

However, some distributors, with monthly sales volumes around $40,000, have reported receiving invitations to join the Broadcom Advantage Partner Program. This suggests that sales volume may not be the sole criterion for determining re-signing eligibility.