Business IT users condemn Broadcom's market behaviour and call on European Commission for appropriate action

Business IT users condemn Broadcom's market behaviour and call on European Commission for appropriate action

2023-06-26 | NB | CIO verenigingen roepen Breton op tot actie EUCS voorstel brengt grote gevolgen voorThursday 28 March 2024 15:29

Today, CIO Platform Netherlands and its three European sister associations sent a joint letter to the European Commission following possible market-distorting behaviour by Broadcom since its acquisition of VMware.

Members of CIO Platform Netherlands and sister associations Beltug, Cigref and VOICE, have in recent months been confronted with the consequences of Broadcom's acquisition of VMware.

Collectively, as associations, we see and hear how negotiations and market behaviour of the major software vendor have deteriorated since its takeover by Broadcom. The lock-in position many business users find themselves in and the fundamental role VMware has in many value chains is taken advantage of.

Letter to the EC
In response to the negative consequences of the takeover, CIO Platform Netherlands, together with its sister associations, sent a letter to the European Commission. In the letter, we describe the perceived problems our members have been confronted with by Broadcom, which include sharp price increases, non-fulfilment of contractual agreements and the prohibition of resale of licences.

In addition, we call on the EC to take the necessary steps to resolve this market disruption and prevent similar harmful practices in the future. Moreover, we ask for the Commission's perspective on these practices.

We conclude that the precarious position in the market resulting from the particularly dependent position of the business user of IT vis-à-vis cloud software/product suppliers has not yet been sufficiently recognised. Because of dependency and lock-in, users are at the mercy of erratic unilateral decision-making by vendors. This damages trust in the market for digital products and services and limits European digital development and autonomy. This calls for an effective European response.

Read the letter here.

For questions and/or comments contact Ronald.

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