Tesco dumps thousands of servers off VMware, blames 'abusive conduct' from Broadcom

Tesco to move 40,000 of its servers away from VMware
Broadcom faces legal action from the UK retailer, which alleges “abusive conduct”
HPE recently announced free licenses for affected customers

One of Britain’s biggest supermarkets, Tesco, is set to migrate around 40,000 servers away from VMware, making it one of the largest publicly disclosed VMware migration projects since the Broadcom takeover.

The news comes as Tesco presses on with legal action against Broadcom in the UK High Court, accusing the company of engaging in “abusive conduct.”

Tesco alleges the company has refused to continue standalone support for perpetual VMware licenses, and that it’s been forced into more expensive subscription bundles.

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Tesco says it purchased perpetual licenses in 2021 with support and software updates until 2026, with the option to extend support for another four years until the end of the decade.

However, due to changes imposed when Broadcom acquired VMware in late 2023, Tesco reportedly faced price hikes of around 175%.

The company is now seeking more than £100 million in damages, but as a mark of its dissatisfaction with Broadcom, it’s looking to migrate now instead of waiting for the court case’s outcome with a deadline of the end of 2027.

It’s also had to hire third-party support providers to maintain its VMware environment, it says.

“Faced with Broadcom’s abusive conduct, and given the criticality of virtualization and mainframe software and services to its business, Tesco has been forced to incur material costs to procure alternative solutions with reduced functionality, and to migrate to that software in a manner, and on a timeframe, that creates very significant risks to its business,” an extract from the filing reads.