Broadcom's critics reject its cloud licensing changes

A smartphone with a displayed Broadcom logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/ File photo

BRUSSELS (Reuters) -Broadcom's critics on Monday rejected the U.S. chipmaker's changes to its cloud licensing practices, saying they do not address their complaints about alleged price hikes, unfair software licensing terms and tying products together.

Last week Broadcom Chief Executive Hock Tan in a blogpost announced a raft of changes to newly acquired cloud computing company VMware's licensing condition following complaints from some EU business users and a trade group.

These included substantial price cuts to VMware's cloud platform and changes allowing customers to move their workloads from their own data centres to cloud providers and between cloud providers.

Trade body CISPE, whose members include Amazon and 26 small EU cloud providers, French association of business users Cigref and Austrian cloud service provider Anexia and CISPE member said the issue was not about Broadcom's subscription licence model.

"What threatens the economic viability of many cloud services used by customers in Europe, are the massive and unjustifiable hikes in prices, the re-bundling of products, altered basis of billing and the imposition of unfair software licensing terms that restrict choice and lock-in customers and partners," they said in a joint statement.

Broadcom said it was creating more choice for customers and partners.

"Our simplified offering at a significantly reduced price responds to customer feedback, and is focused on facilitating seamless workload management," the company said in a statement.

The groups urged EU antitrust regulators, which have asked rivals and customers for their views, to open an investigation into the issue.

(Reporting by Foo Yun Chee; editing by David Evans)

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