Broadcom has lost another significant customer after UK-based cloud operator Beeks Group decided to adopt the open source OpenNebula stack.
Beeks offers virtual private servers and bare metal boxes for financial services providers and emphasizes low latency for both – and for the trading network it operates.
The biz told The Register it operates in over 20 datacenters and runs a fleet of 20,000-plus virtual machines and more than 3,000 bare metal servers. Most of the VMs now run under OpenNebula – an open source project that provides hybrid cloud features on multiple hypervisors but favors KVM.
Beeks head of production management Matthew Cretney told us it moved from VMware due to several factors. A bill from Broadcom for ten times the sum it previously paid for software licenses was one of them. Beeks’s customers also told it that VMware was no longer seen as essential infrastructure.
The tech team also warned management that the quality of VMware’s support services and innovation were falling.
A symptom of perceived innovation woes was that Beeks felt VMware’s suite had a substantial management overhead – that meant too much of its server fleet was dedicated to managing VMs, not running them for clients.
The VMware stack’s very nature as a platform to manage virtual machines didn’t help, either. Some Beeks customers prefer bare metal, as even the isolation provided by virtualization doesn’t satisfy their need for security and low latency. vSphere is not built to manage bare metal servers alongside VMs, and Beeks wanted one tool for both jobs.
A challenging switch
Migration wasn’t easy. Beeks runs proprietary software that it had tied to VMware APIs, and that had to be rebuilt to interface with OpenNebula.
The open source project’s tools to collect metrics Beeks and its clients value – regarding CPU performance, and utilization of CPU, disk, memory, and network resources – were not strong. That’s an issue because an overtaxed CPU or disk can be the difference between pleasingly fast trades or missing an opportunity. As OpenNebula is open source, Beeks felt able to develop tools to collect that info – and succeeded to its satisfaction.
Shifting to OpenNebula meant a 200 percent increase in virtual machine efficiency – meaning more VMs on each server, and lower costs for Beeks and its clients.
Beeks still offers VMware services for customers that want it, but the majority of its VM estate is now on OpenNebula.
Broadcom has positioned VMware’s Cloud Foundation (VCF) stack as ideal for organizations with large and complex IT estates. It argues that, while VCF has a substantial price tag, those who implement the entire suite of compute, storage, and network virtualization components will quickly enjoy ROI that proves the bundle represents exceptional value.
Beeks’s offerings are a little unusual – and perhaps therefore an edge case for VCF. Broadcom could therefore argue that losing most of this particular customer’s business isn’t a blow.
Yet the UK cloud’s decision comes after Broadcom also lost big names such as insurance giant Geico, fintech Computershare, Boyd Gaming, and John Deere – with the post-acquisition licensing terms a common theme behind migration decisions.
US telecom titan AT&T has threatened to quit VMware too, and claimed such a move would quickly pay for itself – but that may have been a negotiation tactic as it has since settled a dispute over a support services contract.
Beeks Group’s experience of substantial savings is therefore another example for those considering what to do when their current VMware deals expire – and they face a decision about whether or not to buy into Broadcom’s virtual vision. ®
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