VMware Users Still Shrinking Footprint

Enterprise IT teams face mounting pressure to adapt as virtualization costs climb. Yesterday's CloudBolt report, covered by Ars Technica on February 17, 2026, shows a persistent trend: most VMware customers continue to scale back their deployments. This isn't a one-off reaction—it's a sustained pivot changing data center operations.

Most VMware users are still "actively reducing their VMware footprint," according to the CloudBolt survey. The report attributes this to Broadcom's explicit stance that its strategy "was never to keep every customer." These findings highlight an acceleration in migrations away from VMware's core products like vSphere and ESXi.

The VMware-Broadcom Backdrop

VMware has long dominated server virtualization. Its hypervisor software lets a single physical server run multiple virtual machines, isolating workloads for better resource use and management. Back in 2023, Broadcom completed its $61 billion acquisition of VMware, a deal that promised synergies but sparked immediate concerns.

Post-acquisition, Broadcom shifted VMware's licensing model. Perpetual licenses gave way to subscription-only terms, with support contracts bundled tightly. Prices rose for many, and product lines like vRealize Operations saw cuts. Customers reported sticker shock—some saw costs double or triple overnight. This wasn't subtle; Broadcom signaled it would focus on high-value accounts, openly stating it wouldn't chase every deal.

The CloudBolt report lands in 2026, three years after the buyout, yet the exodus persists. Enterprises aren't just grumbling—they're acting. Reducing VMware footprint means decommissioning clusters, migrating VMs to alternatives, or consolidating licenses to bare essentials. For IT leaders, this translates to audits of every socket and core licensed under VMware's per-core model.

How VMware Virtualization Actually Works

At its core, VMware's stack starts with ESXi, a type-1 hypervisor installed directly on bare metal. It abstracts hardware—CPUs, RAM, storage, networks—into pools allocated to VMs. vCenter Server orchestrates this at scale, handling clustering, high availability, and live migrations via vMotion.

Engineering tradeoffs emerge in performance and lock-in. ESXi delivers low overhead, often within 5-10% of native speeds for most workloads, thanks to hardware-assisted virtualization (Intel VT-x, AMD-V). But that efficiency binds users to proprietary tools. vMotion requires shared storage like vSAN or NFS, adding complexity and cost. Networking via NSX demands separate licensing, piling on expenses.

Contrast this with open alternatives. KVM, integrated into Linux kernels, runs as a kernel module atop a host OS. It trades some latency for flexibility—no vendor lock forces hardware choices. Developers appreciate KVM's integration with tools like libvirt and oVirt for management. Tradeoffs? KVM might lag in smooth live migration without shared storage, demanding more manual orchestration.

VMware's Distributed Resource Scheduler (DRS) automates load balancing, a boon for dynamic environments. Yet, as footprints shrink, teams weigh if that polish justifies premiums. In 2026, with multi-cloud norms, VMware's on-premises focus feels dated against hybrid-native rivals.

Key Tradeoffs in Hypervisor Choices

This table draws from established hypervisor architectures. ESXi shines in enterprise polish but amplifies costs at scale. Shrinking footprints often means hybrid setups: VMware for legacy, alternatives for new.

Why Are Companies Reducing Their VMware Footprint?

The CloudBolt survey pins it on Broadcom's customer selectivity. Enterprises hit renewal walls, facing audits enforcing strict compliance. One overlooked pain: Broadcom ended standalone support for many perpetual licenses, forcing upgrades.

Developers see this in CI/CD pipelines. VMware Tanzu integrates Kubernetes, but rivals like Nutanix offer built-in container orchestration without extra layers. A team running stateful apps might stick with VMware for stability. Others, building cloud-native, bolt to Proxmox VE—a Debian-based hypervisor with free clustering.

Businesses calculate total cost of ownership. VMware's footprint reduction targets low-utilization clusters first. Migrate dev/test VMs to cheaper hypervisors, keep production on VMware temporarily. Risks abound: migration downtime, skill gaps in new tools. The report misses how this fragments skills—teams split between ecosystems.

Competitive market in Virtualization

Broadcom's VMware faces direct challengers. Nutanix AHV, a KVM-based hypervisor, bundles hyperconverged infrastructure. It skips VMware's licensing traps, pricing by node capacity. Proxmox provides a web UI rivaling vCenter, with ZFS backups and LXC containers alongside VMs.

Microsoft Hyper-V integrates deeply with Windows Server and Azure Stack HCI. For Windows shops, it's a natural swap—free with licensing, strong in failover clustering. Open-source KVM powers Red Hat OpenShift Virtualization, blending VMs and pods smoothly.

These differ fundamentally. VMware emphasizes proprietary extensions like Fault Tolerance for zero-downtime VMs. Competitors prioritize openness: KVM supports any guest OS without royalties. In 2026, as AI workloads demand GPU passthrough, NVIDIA's vGPU works across hypervisors, diluting VMware's edge.

Cloud providers erode on-premises needs. AWS Outposts or Azure Stack run local VMs mirroring public cloud. VMware's Tanzu Kubernetes Grid competes, but footprint cutters often lift-and-shift to public cloud, slashing hardware spends.

Implications for Developers and Businesses

Developers gain freedom but face tooling shifts. VMware's PowerCLI and APIs set a high bar; migrating means rewriting automation in Ansible or Terraform for KVM. Concrete win: open formats like OVF ease VM exports, though VMware-optimized VMs need tweaks for compatibility.

Businesses confront vendor risk. Broadcom's strategy accepts churn, betting on sticky enterprise deals. Smaller firms exit entirely, per the survey. End users? Faster innovation as teams adopt modern stacks. Missed risk: data gravity. Legacy VMware apps resist moves, creating hybrid debt.

In regulated sectors like finance or healthcare, compliance tools like VMware NSX for microsegmentation stay vital. Others prioritize cost: a 2026 survey respondent might idle 30% of capacity underutilized.

What's Next for VMware and Virtualization?

Watch Broadcom's Q1 2026 earnings for customer retention metrics. Will footprint reductions slow, or accelerate with new subscription hikes? CloudBolt's ongoing tracking could reveal quarterly trends.

Milestones include VMware's vSphere 8.0 updates—promised AI optimizations might stem losses. Competitors push: Nutanix's 2026 releases target VMware migrants with migration accelerators. Open-source gains traction via CNCF projects like KubeVirt.

An open question lingers: can Broadcom pivot to win back midmarket? Or does this cement a multi-hypervisor future?

Frequently Asked Questions

What does 'reducing VMware footprint' mean?

It refers to enterprises scaling back VMware deployments by migrating virtual machines, decommissioning clusters, or consolidating licenses. The CloudBolt report shows most users actively doing this in 2026.

Why did Broadcom acquire VMware?

Broadcom bought VMware in 2023 for $61 billion to expand into software-defined infrastructure. Post-deal changes focused on profitability over broad customer retention.

What are VMware's main products?

Core offerings include ESXi hypervisor, vCenter for management, and vSphere suite. Add-ons like NSX for networking and vSAN for storage drive much revenue.

Who are VMware's top competitors?

Key rivals include Nutanix AHV, Microsoft Hyper-V, Proxmox, and KVM-based solutions from Red Hat. Each offers lower-cost or open alternatives to VMware's model.

Is VMware still viable in 2026?

Yes, for high-end needs like mission-critical HA. But the CloudBolt survey indicates widespread reduction, pushing many toward hybrids or full migrations.