In recent weeks, we've delved into the Broadcom VMware acquisition, exploring everything from price hikes and customer reactions to emerging technologies for seamless migrations. Today, let's shift focus to the financial side.
A Lucrative Market
Despite the surge in cloud adoption over the past decade, the market for data center customers remains vast. VMware commands a whopping 80% of the hypervisor market as of 2023, according to IDC1. Gartner notes that by 2022, 75% of businesses were still using VMware for on-premises workloads2. Forrester estimates the total market for migrating VMware workloads to the cloud at $100 billion3. This creates a strong incentive for cloud providers to aggressively pursue data center customers, with the Broadcom acquisition adding more urgency.
AWS Expands Migration Acceleration Program (MAP)
AWS has long enticed customers to migrate substantial workloads to its cloud. The Migration Acceleration Program (MAP) offers "Partner Cash" and credits for future cloud usage. Partner Cash is funding that AWS provides to help offset the cost for migrations. For larger projects, AWS offers credits against future cloud usage. This year, AWS sweetened the deal with per-server incentives for each virtual machine migrated from VMware and bonuses for using Managed Services partners like Bespin Global.
Tackling “Double Bubble” Costs
While generous funding and credits can ease initial cloud costs, "Double Bubble" expenses remain a concern. Complex migrations take time—anywhere from six to eighteen months or more—during which IT costs double as both data center and cloud resources run simultaneously. These costs aren't just about equipment; they include licensing, staffing, labor, and maintenance.
Monetizing Legacy Equipment
To offset "Double Bubble" costs, we found an intriguing solution: monetizing existing data center gear. Bespin Global has partnered with ReluTech, specialists in repurchasing legacy IT infrastructure. ReluTech buys entire stacks—servers, racks, networking gear, storage devices—and pays upfront. They then offer financing plans to keep this equipment available during migration. Essentially, customers can sell their equipment and rent it back as needed. Once migration is complete, ReluTech collects, wipes, and repurposes the equipment.
Toward Net Zero Migration Costs
By discovering aggressive cloud provider incentives and combining them with proceeds from monetizing legacy equipment, Bespin Global aims to help customers achieve near net-zero migration costs. With improved efficiency and scalability in the cloud, this approach can yield a positive ROI in under 24 months. Bespin Global is offering a free 30-day VMware to AWS Launch Program to explore MAP and ReluTech funding programs and develop a business plan for transitioning IT operations from VMware to the cloud.
