The Broadcom Advantage Partner Program for VMware Cloud Service Provider (VCSP) is announced to sunset on October 31st, 2025. The program was initially introduced to simplify the pricing and offer numerous benefits to Cloud Service Providers, after the acquisition of VMware by Broadcom. Now Broadcom has made a shift to focus on VMware Cloud Foundation (VCF). The new model from Broadcom will be an invite-only program, where only a few selected big organisations will be authorised to deliver VMware services. According to Broadcom, they will be working with a focused group of partners who are deeply invested in delivering customer success with VMware Cloud Foundation as demonstrated through market success.
Hundreds of CSPs and MSPs are Losing Business and Market Share
Smaller cloud partners are left with no route to market. After the end of October, hundreds, if not thousands, of VCSPs will no longer be able to deliver VMware services to their customers.
“Anyone that falls below 3,500 cores now has no route to market with VMware,” shares IT Channel Oxygen.
The Broadcom strategy is for VMware to focus on larger, private cloud deployments, built on VMware Cloud Foundation (VCF) and not so much on building a lasting relationship with a large number of smaller cloud providers. This change is currently pushing many CSPs and MSPs to look for alternatives so that they can keep their market share and service portfolio. Deadlines are short and choice is hard. What are the alternatives?
What this Change Means to VMware Cloud Service Providers
For many years, VMware Cloud Service Providers have lived in the comfort zone – no major product and licensing changes, building a business on top of something familiar and reliable. The new reality for them is:
Losing business short-term – The sudden shift away from the VCSP Advantage Partner Program means providers can no longer sell or support VMware services, which directly impacts monthly recurring revenue. Customers are forced to make fast decisions about their infrastructure, and many are already migrating away. This results in an immediate and painful loss of business for many smaller providers.
Losing customer trust – Clients expect continuity, and sudden changes in service offerings can undermine confidence. When providers say they can no longer deliver VMware services, customers may question their stability and reliability. This can trigger churn or force clients to evaluate other long-term partners.
Huge technical gap – not easy to build an exit strategy – VMware has been the backbone of many cloud environments, and transitioning to an alternative platform involves retraining, integration work, and significant architectural changes. Providers must re-evaluate everything from orchestration to billing and support systems. This gap is both technical and operational, and filling it is neither quick nor easy.
Need for an immediate replacement of the Advantage Partner Program for VMware Cloud Service Providers (VCSP)
Without access to VMware licensing, providers need a new go-to-market platform to continue offering virtualised services. And they need this quickly! This replacement must be technically compatible, commercially viable, and offer long-term stability. Delays in finding a new solution could mean losing customers permanently.
The Options for the VMware Cloud Service Providers
VMware Cloud Service Providers must act quickly: either find a viable replacement for VMware or eliminate part of their service portfolio. The latter is rarely an acceptable option—no business willingly gives up revenue streams or abandons customers. That leaves the urgent task of exploring alternatives. Here are the primary steps forward:
- Adopting another proprietary virtualization platform
This approach often involves lengthy commercial negotiations, licensing commitments, and onboarding new technologies with steep learning curves. Contracts must be signed, teams must be retrained, and existing service pricing may need to be restructured to remain competitive. While technically feasible, this route is rarely quick or seamless, and the long-term costs may outweigh the benefits. - Migrating to an open-source VMware alternative
This is emerging as the most practical and future-proof strategy for many CSPs and MSPs. Though it requires an initial investment in learning and integration, open-source platforms offer greater control, transparency, and flexibility. Most importantly, they allow providers to rebuild their service offerings with improved profit margins, fewer licensing constraints, and a stronger long-term foundation for innovation and differentiation.
Apache CloudStack as an Exit Strategy for VMware Cloud Service Providers
Apache CloudStack is designed to orchestrate and manage complex multi-tenant cloud environments. CloudStack, in essence, offers a comprehensive suite of infrastructure resources, including compute, storage, and networking capabilities, well-suited for both public and private cloud environments. This makes it an optimal solution for service providers and a wide range of industry-specific use cases. The combination of ease of use and robust functionality makes it a preferred choice for Service Providers seeking to leverage cloud technologies to benefit their customers.
Unlocking New Revenue: How VMware Cloud Service Providers Can Monetise with Apache CloudStack
Apache CloudStack opens new revenue streams for cloud and managed service providers. Because it is open-source, your customers avoid costly licensing fees—allowing them to invest more in fully managed services. By using CloudStack, providers can unlock monetisation opportunities across multiple areas:
- Reduced Licensing and Support Costs
ShapeBlue compared the cost of building a cloud with VMware Cloud Foundation versus an open-source stack using Apache CloudStack and KVM hypervisor. The study, based on equivalent workloads and environments, found that transitioning to a CloudStack-based KVM cloud can reduce licensing and support costs by over 60% – directly increasing profitability.
- Improved Internal Resource Utilisation
CloudStack is straightforward to learn, deploy, and manage. Your team can deliver projects faster—cutting cloud deployment time by at least 40%, which results in quicker time-to-value and more efficient use of personnel.
- Long-Term Reliability and Customer Trust
With Apache CloudStack, providers are not subject to shifting vendor pricing or product strategies. Its open-source nature ensures consistent service delivery and fosters long-term customer trust.
- Seamless Integration at Your IT Stack
Built on open standards, Apache CloudStack integrates easily with third-party systems – whether for networking, storage, monitoring, or billing – allowing for a broader range of customised service offerings.
VMware Cloud Service Providers Migrating to Open-source
Broadcom’s decision to end the VMware VCSP Advantage Partner Program will leave many CSPs and MSPs locked out of the market by October 31, 2025. Waiting means losing customers, revenue, and trust. Apache CloudStack offers a proven, open-source alternative that reduces costs, integrates seamlessly with existing systems, and provides long-term stability without vendor lock-in. For providers who want to stay competitive and protect their business, the time to migrate is now.
Ivet Petrova is the Marketing Director of ShapeBlue. She is responsible for strengthening ShapeBlue’s global brand and market awareness of ShapeBlue’s services. Specifically, Ivet’s team is responsible for brand, advertising, content and digital marketing, social media, and media relations.
Ivet is also an active member of the CloudStack community, working on increasing the awareness of the technology and showing its benefits to a wider market.
Ivet has 13+ years of experience in marketing for IT service providers including a number of cloud and hosting providers, storage companies, SaaS providers and software development companies. She holds a Masters degree in Marketing.
Away from work, Ivet is passionate about travelling around the world and exploring new cultures.
