Tesco sues Broadcom over apparent breach of contract regarding VMware licenses

Date:
Thu, 04 Sep 2025 09:40:17 +0000

Description:
Tesco is the latest firm to complain about Broadcoms termination of perpetual VMware licenses.

FULL STORY ======================================================================Tesco has sued Broadcom and a VMware reseller for 100 million in damages Tesco was meant to have five years support and upgrades and an optional extension Failure to settle the case could disrupt grocery supply chains across the UK&I, it says

Tesco has sued Broadcom for breaching VMware licensing contracts, with knock-on effects possibly set to disrupt its ability to supply groceries across the UK and Ireland.

The lawsuit comes after the retail giant bought perpetual licenses for
VMwares vSphere Foundation and Cloud Foundation in January 2021, which was meant to include support and upgrades until 2026, with the option to extend for four more years.

However, after acquiring VMware, Broadcom stopped supporting perpetual licenses, pushing its more lucrative subscription-based models instead. Tesco sues Broadcom over ending VMware perpetual licenses

Tesco noted the new pricing strategy causes it to pay excessive and inflated prices for virtualisation software for which Tesco has already paid (via
court documents seen by The Register ).

The company might not be lying when it says it could experience disruptions VMwares software underpins around 40,000 server workloads, including tills
and other operations across stores.

Tesco also named Computacenter as a co-defendant the third party it used as
a reseller for VMware products. The company seeks 100 million in damages from Broadcom, VMware and Computacenter, with the figure set to rise if the case
is prolonged.

Replacing VMware could also be costly and risky for Tesco, potentially presenting further disruptions, hence the legal action to resolve the issue instead.

But Tesco isnt the only company taking issue with Broadcoms pricing
strategies AT&T, Siemens and other have also filed similar lawsuits over perpetual license support.

Broadcom has previously argued that subscriptions are the industry standard, adding that its VMware Cloud Foundation suite delivers more value in the longer term.

Despite pricing strategies that ended up costing many customers more,
Broadcom CEO did publicly acknowledge some unease.

EMEA CTO Joe Baguley also noted 87% of VMwares top 10,000 customers had
signed up for VMware Cloud Foundation, suggesting that pricing concerns
havent translated to a widespread loss of customers.

TechRadar Pro asked Tesco and Broadcom for a comment, but we did not get an immediate response. You might also like Check out the best virtual machine software Weve listed our roundup of the best cloud hosting providers VMware reveals major channel partner shake-up - and it's bad news for smaller firms



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Link to news story: https://www.techradar.com/pro/tesco-sues-broadcom-over-apparent-breach-of-cont ract-regarding-vmware-licenses


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