Broadcom's acquisition strategy is generating significant operational friction, particularly following the integration of VMware. Customers report aggressive enforcement tactics regarding perpetual licenses, including threats of service outages, forcing immediate, costly subscription renewals while prompting long-term migration planning away from the platform. This focus on maximizing immediate revenue from acquired assets is a dominant theme.
Further concerns arise from Broadcom's control over critical infrastructure software tools. The shift of configuration management solutions like VMware and others under corporate ownership is causing IT professionals to seek open-source alternatives, fearing future unpredictable licensing demands and gatekeeping of essential technologies.
On the strategic technology front, CEO Hock Tan recently downplayed the near-term significance of silicon photonics for data centers, despite the company holding substantial pre-orders for custom AI accelerator chips. This suggests a current focus on established, high-demand custom silicon projects over immediate broad adoption of next-generation optical interconnects.
The overall picture shows a company aggressively monetizing recent acquisitions through stringent licensing and support enforcement, creating immediate customer dissatisfaction at the operational level, while simultaneously managing high-value custom silicon demand.
Last updated February 7, 2026