Broadcom Chief Simplifies VMware's Product Line After $69 Billion Acquisition: Report

Broadcom Inc.’s AVGO $69 billion acquisition of VMware in 2023 marked a significant shift in the tech industry.

In the year following the deal, Broadcom drastically reduced the number of VMware products from thousands to just five, responding to customer feedback that the original plan for only four bundles was too limiting, Financial Times reports, citing an interview with Broadcom CEO Hock Tan.

Tan explained that simplifying VMware’s offerings made the product “easier” to use, aligning with their goal of streamlining and boosting efficiency.

With the rise of artificial intelligence (AI), Tan sees VMware as a key alternative for companies looking to avoid handing over their data to large US cloud providers, especially in Europe.

VMware’s virtualisation system allows businesses to manage their data centers more efficiently, reducing hardware costs while improving resilience and security.

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Despite estimates that 20% of VMware customers would leave, Tan stated that churn had not significantly increased.

He described the complaints as coming from a "short-sighted customers.” Tan argued that these customers overlooked the value of long-term cost amortization.

Earlier this month, the company announced the availability of the Brocade G710 24-port 64G switch, a top-of-rack SAN switch.

Brocade Gen 7 Fibre Channel combines cyber-resilient and autonomous SAN technology into this cost-effective platform that seamlessly integrates into rack-based storage solutions, the company said.

The Brocade G710 switch extends the 64G SAN portfolio, which includes fixed port switches, modular directors, extension switches, and management software.

According to Benzinga Pro, AVGO stock has gained over 94% in the past year. Investors can gain exposure to the stock via Columbia Semiconductor and Technology ETF SEMI.

Price Action: AVGO shares are trading higher by 1.68% to $240.99 premarket at last check Tuesday.

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