Broadcom Faces Antitrust Complaint Over VMware Pricing & Partner Program in Europe

European cloud service providers (CSPs) are pressing the European Commission (EC) to intervene in Broadcom’s restructuring of the VMware partner program, arguing the changes represent an “ongoing abuse” that threatens the viability of smaller cloud businesses and limits customer choice. The complaint, filed by the Cloud Infrastructure Service Provider in Europe (CISPE) trade group, centers on Broadcom’s decision in January to terminate the VMware Cloud Service Provider program in Europe, effectively cutting off access to VMware products for many CSPs.

The move follows Broadcom’s $69 billion acquisition of VMware in October 2023, a deal that CISPE and others have warned would lead to increased prices and reduced flexibility for customers. CISPE, representing nearly 50 tech suppliers, alleges that Broadcom has since imposed price increases—in some cases, tenfold—along with restrictive bundling practices and commitment requirements based on projected, rather than actual, usage. Some customers have reported price hikes as high as 900 percent, according to reporting by Ars Technica.

The VMware Partner Program Shift: A Narrowing Ecosystem

Prior to Broadcom’s changes, VMware reportedly had over 4,000 CSP partners globally, with a significant presence in Europe. The terminated Cloud Service Provider program allowed a broad range of CSPs to offer VMware-based cloud services to their customers. Broadcom replaced this program with a more selective, invite-only alternative geared towards larger partners serving enterprise clients. A key requirement for participation in the new program is a minimum of 3,500 processor cores, effectively excluding hundreds of smaller CSPs. Currently, VMware reportedly has only 19 CSP partners in the US and around nine in the United Kingdom, a dramatic reduction from previous levels.

The core of CISPE’s argument is that Broadcom is leveraging VMware’s dominant position in server virtualization software to exert undue control over the market. Server virtualization, the process of running multiple operating systems on a single physical server, is a foundational technology for cloud computing. VMware has long been a leading provider of virtualization software, and Broadcom’s acquisition gave it significant market power. CISPE contends that Broadcom is exploiting this power to extract higher prices from customers and steer them towards more profitable offerings, even if those offerings don’t meet their needs.

Financial Incentives and the Pursuit of Profitability

CISPE’s concerns echo earlier analysis of Broadcom’s acquisition strategy. In December 2025, CISPE challenged the European Commission’s approval of the merger, arguing that the Commission failed to adequately assess the risks associated with Broadcom’s financial incentives. CISPE’s filing highlighted Broadcom CEO Charlie Giancarlo’s public commitment to increase VMware’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) from around $4.7–5.0 billion to $8.5 billion within three years of closing the deal—a substantial increase given the market’s growth rate. CISPE argued that such a jump could only be achieved through aggressive monetization of VMware’s existing customer base, including steep price increases and tighter contractual lock-in.

The acquisition was also financed with significant debt—approximately $28.4 billion in new debt and $8 billion assumed from VMware. This debt load, CISPE argues, creates a powerful incentive for Broadcom to rapidly extract cash from VMware’s installed base, reinforcing its market power and justifying aggressive pricing strategies.

Broadcom’s Response and the Hyperscaler Connection

Broadcom has strongly refuted CISPE’s allegations, dismissing them as misrepresentations funded by “hyperscalers”—large cloud providers like Amazon Web Services (AWS) and Microsoft Azure. In a statement, Broadcom asserted its commitment to investing in its European VMware Cloud Service Provider partners and helping them compete with hyperscalers. Though, CISPE notes that AWS and Microsoft are listed as “adherent members” of the organization, with limited voting rights and restrictions on participation in certain activities.

This connection to hyperscalers raises questions about the motivations behind CISPE’s complaint. While CISPE maintains it represents the interests of independent CSPs, the involvement of AWS and Microsoft suggests a broader effort to challenge Broadcom’s market power. These larger providers may see Broadcom’s actions as creating opportunities for them to gain market share by offering alternative cloud solutions.

The Antitrust Complaint and Potential Remedies

CISPE is asking the European Commission to impose interim measures to halt Broadcom’s termination of the VMware Cloud Service Provider program, reinstate displaced partners, and prevent retaliation against them. The complaint alleges that Broadcom’s actions violate EU antitrust laws, which prohibit companies from abusing their dominant market position to harm competition. The EC has the power to investigate the complaint, impose fines, and order Broadcom to change its practices.

This case is unfolding alongside a separate legal challenge. In July 2026, CISPE filed an appeal with the European General Court seeking to annul the EC’s original approval of the Broadcom-VMware acquisition. That appeal argues that the Commission failed to adequately consider the potential anticompetitive effects of the merger. The Register reports that the program is still honoring transactions until March 31st, giving the EC a limited window to act before the changes are fully implemented.

Looking Ahead: Regulatory Scrutiny and Market Dynamics

The outcome of these legal and regulatory challenges will have significant implications for the European cloud market. A favorable ruling for CISPE could force Broadcom to revise its partner program and pricing practices, potentially opening up more opportunities for smaller CSPs. However, Broadcom is likely to vigorously defend its actions, arguing that they are necessary to drive innovation and profitability. The EC’s investigation will likely focus on whether Broadcom’s conduct is genuinely anticompetitive or simply reflects legitimate business decisions. The case highlights the growing scrutiny of large technology mergers and the challenges of balancing innovation with competition in the rapidly evolving cloud computing landscape.