Tesco is ripping 40,000 workloads off VMware and suing Broadcom for £100M

Why a supermarket is in court with a chipmaker

The UK's largest retailer is migrating roughly 40,000 server workloads off VMware and, in parallel, suing Broadcom in the UK High Court for damages exceeding £100 million, Ars Technica reports. The grievance is specific: in January 2021 Tesco bought perpetual licenses for VMware's vSphere Foundation and Cloud Foundation, plus a Tanzu subscription and support running through 2026. Broadcom acquired VMware in November 2023 and began rewriting the licensing model — Tesco's claim is that this effectively destroyed licenses it had already paid for outright.

The migration is being run on a compressed timeline, and it carries a sting in the tail. Tesco's chosen replacement (unnamed in filings) is incompatible with the Veeam and Zerto backup and disaster-recovery tools it relies on, raising data-protection risk mid-flight. The retailer concedes it had to procure alternatives with reduced functionality — losing support and updates for 40,000 production workloads could disrupt operations at one of the world's largest grocery chains.

The thread: 'VMware is still basically the only option'

The detail that caught the thread was the backup incompatibility. A network operator zeroed in on it: "What is a VMware alternative, that isn't compatible with backup software? I'm guessing it's not nutanix?" The deeper reading was bleaker. A commenter who'd hoped for an open-source happy ending reached the opposite conclusion:

"My hope from this headline was that some open source solution was functionally equivalent from a business perspective. But then I read that Tesco has had to procure alternative solutions with reduced functionality meaning VMWare is still basically the only option if you need something that works out of the box."

That is the uncomfortable core: even a furious customer the size of Tesco can't find a like-for-like exit.

Broadcom's reputation precedes it

The thread treated Broadcom's conduct as a known pattern, not a surprise. A VP of logistics and operations at a print company offered to round up witnesses:

"If Tesco needs character witnesses that Broadcom has done this to many other customers, I think they'll find plenty of willing participants. Broadcom's marketing for Proxmox is extremely effective."

The same playbook keeps surfacing in adjacent products. A commenter burned by a different Broadcom move described losing free Bitnami Docker images: "they did this by just yanking the images from the registry too, leaving nodes to fail if they lose their image cache and have to restart." And a director of engineering, unfamiliar with the scale, asked the question many readers had — why does moving these take 18 months at all? Is it poor config management, lack of automation, or something inherent?

The lesson enterprises keep relearning

The quietest comment carried the sharpest verdict. A commenter asked: "none of the major VMWare customers had a second/alternative vendor/product? I hope they learnt the lesson." That is the rule the story enforces. A perpetual license is only as perpetual as the vendor's owner allows, and a single-vendor virtualization stack with no migration path is a £100M lawsuit waiting for an acquisition. Tesco is paying the tuition; the well-trodden migration paths the thread keeps mentioning exist precisely because it isn't the first.