The Great Rebalancing Begins: Why VMware Disruption Is Just the Start

The past year has significantly impacted the technology industry. Changes to VMware licensing and partner structures have disrupted pricing and challenged long-standing beliefs about what makes up a stable enterprise infrastructure. For most companies relying on VMware, once-predictable cloud strategies now seem uncertain, costly, and out of alignment, prompting a thorough re-evaluation and strategic reconsideration.

However, this disruption is not an endpoint. Instead, it’s the beginning of something bigger: The Great Rebalancing of the cloud era.

From “Cloud First” to “Cloud Smart”

The old doctrine of “cloud first” has been impacted by myriad challenges, including cost stability, performance, security, and control. The reality is that many workloads don’t require elastic capabilities, and costly reserved instances have become an IaaS standard. Many teams cannot tolerate opaque billing and unpredictable monthly costs from all the additional services required for their applications. The hidden costs of an EC2 instance typically look something like this¹:

• Egress Data Transfer: 30-50%
• EBS Snapshots: 15-25%
• Elastic Load Balancing: 10-20%
• NAT Gateway: 5-15%
• Elastic IP Addresses: 5-10%
• VPN Connection: 2-5%
• Elastic Inference: 0-5%

As a result, in many companies, hyperscale fatigue has set in. Businesses want cost predictability and simplicity, not continual surprise invoices.

Simultaneously, the myth that hyperscale is the sole innovator in the cloud is cracking. While hyperscale has helped redefine scalability, that advantage has been overstated and overpriced for most steady state workloads. Modern private and on-premises clouds now deliver the same orchestration, automation, and elasticity that were once unique to hyperscale environments, but with improved economics, predictability, and control. In many cases, these platforms outperform hyperscale in speed, data locality, compliance, security, and performance.

Furthermore, hosting your critical business applications in a hyperscale data center involves risks, including limited support and a lack of control. What if those workloads are suddenly held accountable for an increased cost of service? Considering the current trends in investments, if AI revenues fail to materialize on the scale that hyperscale companies are investing in – approximately $320 billion planned in 2025 – this could happen and prove catastrophic.² For example, Oracle’s debt-to-equity ratio is over 500%, which could potentially lead to future debt default.³

As a result of all this, the market is recalibrating, and rightly so. Businesses are shifting from experimental public cloud growth to a more strategic approach, focusing on workload placement and selecting the right cloud for each workload. We call this transition The Great Rebalancing – a decisive move from risk in cloud sprawl to confidence in intentional design.

For On-Premises, VMware is the Catalyst, Not the Culprit.

Broadcom’s consolidation of VMware Cloud Service Providers, resellers, and alliance partners has left thousands of businesses stranded, facing 2-12x increased costs and potential contract issues. ⁴ Companies need to review their hardware for compatibility with the new VMware portfolio, especially considering new minimum CPU commitments that their current investments may not support, and find a partner to assist them. On the other hand, while Broadcom’s actions have caused upheaval, they also present an opportunity for modernization and change – something most organizations would not pursue without a compelling event.

This is a moment to rethink what you really need from a virtualization foundation. At Expedient, our approach helps turn a forced migration into a managed modernization, shifting from ad-hoc survival to strategic transformation.

Through Expedient’s “Stabilize, Optimize, and Modernize” framework, clients are guided through a process designed to deliver bespoke results:

• Assess: Expedient begins by assessing your current workloads, costs, and optimal execution environment. Many aren’t “hyperscale ready” but are well suited to a modern private cloud.
• Migrate: Expedient handles complex migrations, transferring workloads securely and efficiently without requiring refactoring. This alleviates CapEx, resolves VMware licensing issues, and reduces DIY cloud risks, all through a well-planned process that ensures cost stability and performance.
• Operate and Improve: Expedient handles daily tasks such as patching, upgrades, monitoring, protection, disaster recovery, and performance. This enables your teams to move beyond maintenance to higher-value work. A consistent cloud model simplifies governance, budgeting, and evolution.

Building Cost Stability Through Managed Private Cloud

Innovative companies are reassessing their cloud strategies and discovering that private cloud offers the best of both worlds: the flexibility of public cloud combined with the performance and security of on-premises solutions. Expedient’s managed private cloud provides predictable costs that are up to 30% less expensive than hyperscale for steady workloads. This solution also delivers operational stability through an intelligent cloud management model, led by experienced experts, that allows your internal teams to focus on growth. It’s all backed up resilient performance via dedicated resources that ensure consistent latency and disaster recovery, supported by a 100% uptime infrastructure SLA.

The Stage Is Set for Intelligent Infrastructure

The VMware shockwave and hyperscale fatigue reflect a larger shift as businesses face instability and uncertainty. They want control without complexity and modernization without overspending. Expedient Intelligent Infrastructure offers managed, high-performance cloud environments to enable ongoing transformation.

The Great Rebalancing is more than just a market correction: it represents a redefinition of value. Those who stabilize, optimize, and modernize will transform disruption into lasting advantages – and Expedient is prepared to guide that shift from reaction to reinvention.

Ready to Turn Disruption into an Advantage?

See what a modern, cost-stable cloud operating model could look like for your business. Find out more today.