Broadcom’s $69 billion acquisition of VMware was always going to be a transformative move. But few expected the sweeping changes that have followed—particularly for VMware’s channel partners.
This month, Broadcom announced the elimination of VMware’s lowest-tier “Registered” partner level. This change is part of a broader strategy to consolidate and professionalize VMware’s channel program—streamlining from four tiers down to three: Pinnacle, Premier, and Select.
Why the Change?
Broadcom says the move was driven by data: most value to customers and business growth comes from the top three partner tiers. Many “Registered” partners, according to Broadcom, were inactive or lacked the technical capability to support today’s hybrid and private cloud environments. The goal is to create a leaner, more capable partner ecosystem that can deliver on Broadcom’s cloud-first roadmap.
Partners in the U.S., Asia-Pacific, and Japan regions will receive 60 days’ notice before they are deauthorized. Notably, partners in Europe are exempt from this change—for now. This may be due, in part, to increased regulatory scrutiny abroad. European trade associations have already raised alarms about Broadcom’s post-acquisition strategies and their compliance with EU competition laws.
Raised Expectations for Remaining Partners
Broadcom isn’t just reducing the number of partners—it’s raising the bar for those who remain. Pinnacle and Premier partners must now commit to:
- Dedicated sales and technical resources
- Active business planning with Broadcom/VMware teams
- Professional services certification or proven SMB practice development (for Pinnacle partners)
These higher expectations are designed to ensure all partners are positioned to guide customers through complex migrations and modern cloud architectures—particularly with VMware Cloud Foundation (VCF) at the center.
A Divided Response
Some partners welcome the focus and structure, noting that it rewards those who have invested heavily in VMware practices. Others, particularly smaller resellers and managed service providers, view it as an existential threat. Customers may also feel the squeeze, especially if their trusted IT advisor suddenly loses partner status.
In Europe, where changes have not yet been implemented, there is growing pressure on regulators to examine Broadcom’s moves more closely. The European Cloud Infrastructure Providers group (CISPE) has even alleged that Broadcom’s new licensing practices may violate competition law.
What Comes Next?
Broadcom is betting that a smaller, more specialized partner ecosystem will drive deeper customer engagement, faster innovation, and a stronger return on investment for both Broadcom and its clients.
But it’s also a risky gamble. Alienating large swaths of the partner base—many of whom serve SMBs and niche markets—could erode VMware’s reach and open the door to competitors.
For customers and partners alike, one thing is clear: VMware under Broadcom is no longer business as usual.
Original reporting from Ars Technica
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