VMware loses three top executives who owned growth products • The Register

VMware announced that three senior executives have decided to leave the company.

The three employees who died are Tom Gillis, Mark Lohmeyer and Ajay Patel.

Gillis was senior vice president and general manager of the VMware Networking and Advanced Security Business Group. Lohmeyer was vice president and general manager of the company’s cloud infrastructure business group. Patel served as Veep and GM of the Modern Applications and Management Business Group.

VMware tells The registry All three “have decided to leave VMware for new opportunities,” in a statement that begins:

Four executives were removed from the bank to replace the departing employees.

Umesh Mahajan will lead the Business Group Networking and Advanced Security. Krish Prasad will lead the Cloud Infrastructure business group, while Purnima Padmanabhan will lead the Modern Apps and Management business group. Jason Rolleston takes over the Security division.

Senior executives with decent track records are often in demand – but few providers lose three in a short period of time.

And as VMware has acknowledged, the upcoming acquisition by Broadcom and the shift to multi-cloud management are both logical starting points.

But these exits look bad for two reasons.

One is that VMware’s rank and file will surely wonder why three senior executives decided to leave the company, perhaps concluding that their departure is a signal that they would be wise to do the same.

Second, the top three companies also oversaw products that have flagged VMware — and Broadcom — as sources of future growth. But VMware has recently seen modest growth of just 1 percent year over year — even though it launched several major product releases at a time, giving customers very good reason not to increase spending.

The modern applications and management business group focuses on cloud native application development, multi-cloud management via VMware Tanzu and the recently rebranded Aria portfolio (formerly known as vRealize). VMware is scrapping hard to get its container-centric Tanzu portfolio accepted by its customers because it knows the days of the virtual machine as the dominant way of packaging abstractions are over, and so it is for the world of cloud-native applications and container must be relevant . This means attracting developers who don’t inherently see VMware as a vendor to consider.

The Networking and Advanced Security Business Group was tasked with explaining VMware’s vision of embedding security deep within the network and compute stacks – an approach the company sees in contrast to current arrangements, which typically involve multiple overlapping security products used in a company. VMware has long hoped it could help customers transform security and edge out competing security vendors with its Carbon Black line. There is little evidence that the plan has achieved any significant success.

The Cloud Infrastructure business group covers VMware’s core computing products applied to all types of clouds.

The executive departures come as Broadcom continues to publish articles written by CEO Hock Tan denying that he plans to raise prices for VMware products or has no interest in serving certain market segments. The company used both tactics after acquiring CA and Symantec.

Analyst firm Gartner updated its forecast for VMware customers on Dec. 2, noting that while Broadcom doesn’t think Broadcom will repeat tactics used in previous acquisitions or directly raise prices, customers will continue to feel pricing pressures.

“We anticipate that Broadcom will initially seek to increase customer spending by expanding customer usage of VMware products,” the company’s recommendation reads.

“However, we believe that customers who choose not to expand their use of VMware products will face cost increases (either through price increases, rebate adjustments, metric changes, audits, or a combination of these factors). We believe Broadcom will accelerate the move from perpetual to subscription licenses and from per-CPU to per-core pricing.”

Broadcom now loves user groups

As VMware customers digest this advice, Broadcom wrote to members of the VMware User Group (VMUG) last week. [PDF] to tell them everything will be fine.

The registry sometimes attends VMUG meetings, has heard members speculate that Broadcom’s stated preference to reduce sales and marketing spend at acquired companies could result in the end of financial support for the user groups. Ending funding, members tell us, would represent a significant and unwelcome shift in how VMware relates to its community.

The letter does not specifically state that Broadcom’s ownership of the financial support will continue, but Tan states that in his ongoing meetings with the VMware ecosystem, “One issue struck me: the value the VMware User Group brings to the broader ecosystem brings. The passion, talent and commitment of VMUG members – whether they are end users, partners or VMware employees – speaks to what we excite about VMware and the tremendous potential we see in this combination.”

The letter also argues that the combination of Broadcom and VMware will be beneficial to customers as it creates a broader software portfolio with greater relevance to a multi-cloud world.

But VMUG members and VMware customers will have to wait many months before seeing Broadcom’s words come to fruition. Broadcom told investors last week that while regulators in Brazil, Canada and South Africa had approved the acquisition, the European Union is expected to conduct a full investigation into the transaction’s competitive aspects. That will take some time, but shouldn’t ruin plans to close the deal in late 2023.

VMware must therefore continue with business as usual while regulators ponder its fate — and while employees wonder why three of its senior executives decided they could do better elsewhere. ®

https://www.theregister.com/2022/12/13/three_senior_vmware_executives_leave/ VMware loses three top executives who owned growth products • The Register

Rick Schindler

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