VMware again extends formal deadline for Broadcom deal
Meanwhile, rivals circle and the hybrid cloud management market morphs
VMware last week extended the deadline for the completion of its acquisition by Broadcom – again.
A Friday filing reported "a mutual notice to extend the Outside Date (as defined in the Merger Agreement) to August 26, 2023."
The previous outside date was May 26. The filing also points out that it's possible VMware and Broadcom will extend the date again – to November 26.
That day lies beyond October 31 – the last day of Broadcom's financial year and the deadline by which CEO Hock Tan has often said he expects and prefers the deal to be done.
Regulators stand in the way of that ambition. The UK Competition and Markets Authority has initiated a stage two probe it expects will conclude in "late August". The European Union recently extended its provisional date to decide the matter by three days, to July 17. The EU also noted that on May 16 Broadcom filed its proposed commitments to allay competitive concerns. US regulators are also considering the matter, without having offered a date on which their deliberations will be delivered.
While the regulators do their thing, the hybrid multicloud market is heating up.
VMware arguably set the scene way back in 2016 when it announced what it then labelled a "Cross-Cloud Architecture" – making the datacenter software-defined in the service of allowing data and apps to be managed regardless of where they run or reside.
Things have since been made a little more complicated by cloud native software development practices. They make it likely organizations will deploy more resources, in more places, creating more management hassles.
Vendors have responded to that in two ways – one of which is evolving their wares to meet the new mess.
IBM last week launched a "hybrid cloud mesh" – software it describes as able to "automate the process, management and observability of application connectivity in and between public and private clouds."
"By offering the service of connectivity via IBM Hybrid Cloud Mesh, clients can help address the significant strain that infrastructure and operations teams can feel when deploying, managing, and securing their hybrid multicloud networks in an era with increasingly limited control and visibility," states Big Blue's blurb, in language that would not feel out of place on a VMware product page .
Nutanix has also made a play. It recently effectively extended its business into providing security and data services across hybrid multiclouds with "Project Beacon" – a plan to build PaaS services developers can use the underpinning of multicloud apps.
- Multicloud isn't necessary, says Gartner … until it is
- Oh, really? Microsoft worries multicloud complicates security and identity
- Save $7 million on cloud by spending $600k on servers, says 37Signals' David Heinemeier Hansson
- What's driving multicloud? War, regulation, plague, says Acronis CEO
The other market move is cashing in on nervousness about VMware and Broadcom.
At the recent .NEXT conference, Nutanix CEO Rajiv Ramaswami told The Register his company continues to field approaches from VMware users who remain nervous about the Broadcom deal. Some, he said, are just kicking tires. Others are seriously considering engaging with Nutanix as second source of software-defined datacenter infrastructure.
Junior virtualizer Virtuozzo, the service-provider-centric spinout from desktop hypervisor vendor Parallels, sees opportunity the VMware/Broadcom transaction. It's spruiking OpenStack hosted by service providers as a viable alternative or complement to VMware.
Even the likes of ServiceNow see an opportunity in multicloud – if only a niche play for unified observability.
Which is why VMware's Friday filing is more than a pro forma document. It reminds customers and rivals of uncertainty surrounding the deal.
Broadcom has assured VMware customers it will increase investment so that VMware builds brilliant multicloud products and promised not to raise prices. It's also repudiated much of the playbook it used after acquiring CA and Symantec, when Broadcom concentrated its efforts on only the largest customers. This time around it is insisting it wants to serve all of VMware's customers and channel, regardless of size.
As Broadcom and VMware are both listed, it is hard for Broadcom to say more while it waits for regulators to make their decisions.
But while it waits – along with VMware customers – the market is moving. ®