Nutanix reaps rewards from VMware ructions

Nutanix now has over 25 000 customers, and its annual recurring revenue increased 24% to $1.8 billion.

01 July 2024

Rajiv Ramaswami, Nutanix

There’s a pleasing informality about Nutanix, which sets it apart from other vendors that have grown so big that their conferences turn into razzle dazzle productions ever more lavish with each passing year. CEO Rajiv Ramaswami even forgot his clicker when he got on stage to deliver his keynote at the sprawling Fira Barcelona conference centre in May. VMware always holds its annual conference at the Fira, and there was much mention of the virtualisation giant, which was bought by Broadcom for $69 billion in November 2023, and the subsequent ripples of disruption in the market. These ripples have reached customers of all sizes, some of whom were at the Nutanix conference, and told of how they were either moving away from VMware entirely, or were now applying a derisking strategy.

That doesn’t mean VMware is going anywhere; it has the lion’s share of the hypervisor market. But Nutanix says it’s now in a position to offer itself as an alternative. In hindsight, the Broadcom acquisition has been a bumpy ride for customers and partners. But any kind of change is always painful. Broadcom tends to eat the companies it buys from nose to tail to achieve efficiencies, rather than let it operate as a standalone company, such as IBM did with Red Hat. In the case of VMware, gone is the perpetual licensing, although this was long overdue, and some customers have complained bitterly about swollen bills. Broadcom is on record as telling The Register that the claims are without merit and customers who are using two or more components of VMware Cloud Foundation (VCF) will now be paying less. Its bundles also include support, which used to be sold separately. Ian Jansen van Rensburg, the lead technologist at VMware by Broadcom in Sub-Saharan Africa, told Brainstorm earlier this year that customers used to pay per CPU socket on a perpetual licence. Now, customers are being charged per core, and they have to take a minimum of 16 cores per socket. He maintained that Broadcom has made it easier and cheaper for the customers to consume VMware’s products, and VMware’s Cloud Editions were more expensive before the acquisition.

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