Plans for massive R&D spend for VMware in place once deal approved

With Broadcom’s blockbuster US$60 billion acquisition of VMware moving closer to becoming a done deal, details on what will happen when all approvals are in are beginning to surface.

Judging by comments made by Broadcom chief executive officer (CEO) Hok Tan on Tuesday in a recorded message delivered at the  VMware Explore 2023 partner and user conference in Las Vegas, there are certainly no plans for cost-cutting.

“I’ve said this before, and it’s worth repeating: the proposed combination of Broadcom and VMware is pro-competitive and will deliver great value,” he said. “It will advance the vision of workloads running in a multicloud environment.

“Our customers and partners will have access to a stable, growing and powerful multicloud platform underpinned by world class security, enabling them to accelerate innovation for all their applications.

“And once this transaction closes, we will focus on investing in VMware products and services. In fact, Broadcom will immediately invest an additional US$2 billion a year to better unlock customer value. Now, half of that investment will be focused on R&D.”

Tan, who said he is confident that the acquisition, which is in “advanced states of regulatory review,” will be approved, added that the “other half [of the investment] will focus on helping to accelerate deployment of VMware solutions through VMware and partner professional services. Broadcom will invest in growing VMware’s partner ecosystem, to help them grow their own businesses, and better support our mutual customers.”

Meanwhile, The Register reported today that VMware president Sumit Dhawan said that funds will be used to “simplify and extend its platform, to ease upgrades, and encourage users to adopt more of its stack.” It said that he also noted that VMware recognizes its products can be complex, which deters adoption and upgrades, “So that is the problem we want to address through increased investments.”

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Paul Barker
Paul Barker
Paul Barker is the founder of PBC Communications, an independent writing firm that specializes in two specific areas: The creation of marketing communications content for businesses of varied size and scope, and freelance journalism. He has extensive experience as a reporter, feature writer and editor and has been covering technology-related issues for more than 30 years.

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