The series is over. Broadcom announced the eventual purchase of VMware for $68 billion before the end of the period in which the agreement fell on deaf ears. The meeting between Biden and Xi Jinping smoothed the waters, and the Chinese Competition Commission finally gave its approval to the takeover. Other competition authorities have done this before, as we reported on Byte TI a few days ago, but China was necessary for the agreement to come to fruition. Without this approval, it would not have been possible to reach the million-dollar agreement, which would make Michael Dell more than a millionaire.
As expected by the majority of executives attending the VMware Explore conference held a few weeks ago in Barcelona, the viability of the acquisition depends exclusively on what Chinese and North American leaders agree in their own battle. The armistice was signed, and with it one of the largest purchases in technological history.
From now on, VMware will be part of the Broadcom network, a company with a very bad reputation due to its bad track record and its specialty of buying fairly blue-chip companies and later selling them in small pieces to the highest bidder. With VMware, Broadcom CEO Hock Tan merely ensured that would not happen with the newly acquired company, saying it was strategic.
Leading analysts also doubt that the Malaysian-born businessman will return to his old ways, especially for two reasons: the money spent on the acquisition and the strength and number of customers relying on VMware’s technology. But the spirit of Christmas past that always accompanies Tan’s privacy should not be underestimated.
Right now, he entered Attila’s horse mode. Elon Musk’s methods and ethics are under fire, but the eccentric South African is just an intern for the Broadcom CEO. He must have learned from him that wonderful technique of sending out group class emails. That’s what Hock Tan did once he bought CA Technologies and Brocade, and it’s what he did again once the VMware purchase became official. A technology that will once again impact a large part of the US workforce, and if the approach of previous purchases continues, after the Americans, it will be the role of the rest of the subsidiaries that VMware has deployed around the world.
As mentioned interested in trade, Some employees ate breakfast Monday with an email that said: “Broadcom recently completed the acquisition of VMware. As part of integration planning, and after assessing organizational needs, we identify future roles that will be required within the combined company. Therefore, we regret to inform you that your position will be cancelled. We would like to thank you for your dedication and service. “We want to make this transition as smooth as possible, including offering you a generous severance package and providing you with a paid notice period out of work.”
Elon Musk is just an intern for Broadcom CEO Hock Tan, and he almost certainly learned the technique of sending out mass layoff emails from him, which he just did at VMware.
It’s not known how many VMware employees are out of work this week, but it’s something many of them were already dreading, as the virtualization giant has been reducing a workforce that reached 38,000 in February for several months. At that time, there were also many senior executives who left the company to go to other companies.
Doubts about Broadcom’s strategy
It is Tan’s philosophy that raises doubts about the path that VMware integrated within Broadcom will take. It’s not just employees who are worried about what will happen in the near future of their jobs. So do analysts and, more importantly, customers. You see, a man who makes friends wherever he goes: Analysts accuse him of only cutting costs, halting innovation, and increasing prices after the purchase is closed. Customers also accuse him of raising prices, which creates uncertainty.
Until now, VMware has been a company focused on customers and their needs. The company’s philosophy will change if we stick to Tan’s illustrious CV: The customer is the source of the money. The focus will no longer be just on customer needs, but on Broadcom’s (economic) needs.
Nor can it be said that the Broadcom CEO’s immorality and penchant for breaking up companies will cease on this occasion. Among the best candidates is the department responsible for, among other things, the development of virtual infrastructure software Horizon or Workspace One, the intelligent digital workspace platform, which VMware has particularly focused on since the outbreak of the pandemic to facilitate remote work.
Distance working? Hock Tan has an aversion to these two words. The businessman is educated in the old school, where attendance is more important than productivity and success. How is a salesperson going to sell a remote work platform if the company selling it doesn’t believe in it?
The rest of the tenths of the potential sale appear to be owned by Carbon Black. Here the reasons are less personal. This solution was acquired in 2019 for $2.1 billion, and is not yet fully integrated into the VMware ecosystem. In theory, it was scheduled to be integrated in no more than two years, but coincidentally, since the announcement of Broadcom’s intention to buy VMware, the integration has remained in standby mode. Add to this the fact that Carbon Black competes with many Symantec solutions, and it’s no surprise that it’s also outselling.
All you have to do is wait a few months and see if all of Tan’s pre-purchase claims hold up. Most likely, you also have “changes of opinion.”
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