VMware Pricing in Finance vs Healthcare
Broadcom may publicly claim that VMware’s pricing is standardized, but in practice, the industry still shapes the deal.
The type of business you’re in – finance, healthcare, tech, etc. – can significantly influence the discounts and terms you get on VMware licenses. Some sectors command leverage, while others face “take-it-or-leave-it” pricing.
This industry benchmark breaks down how VMware pricing differs by vertical, focusing on finance versus healthcare, and touches on the nuances for tech firms and regional patterns.
The upshot: Broadcom’s “one-size-fits-all” pricing isn’t really equal for all – it’s tailored to maximize revenue based on how stuck (or mobile) they think you are.
Pro Tip: Standard pricing doesn’t mean equal pricing — it means controlled pricing.
For an overview of benchmarking pricing, read our guide, VMware Pricing Benchmark – Understanding the New Broadcom Discount Reality.
Why Industry Still Shapes VMware Pricing
Why does industry matter at all if pricing is supposedly standardized?
Because Broadcom has a strategic playbook: maximize margin where customers have low switching risk, and show flexibility only where it truly fears churn.
Highly regulated sectors like finance and healthcare are considered reliable, low-churn clients – they’re deeply invested in VMware and constrained by compliance, making them unlikely to jump ship.
In contrast, tech companies or cloud-native firms are seen as more price-aggressive and capable of migrating away from traditional systems.
Broadcom tailors its approach accordingly. In essence, the less likely you are to leave VMware, the more they’ll charge you. Broadcom’s sales strategy zeroes in on who can’t move easily, and prices those customers accordingly to extract maximum value.
(Broadcom knows which customers have no easy alternatives – and those clients often see the stiffest pricing.)
Finance Sector – Deep Pockets, Low Mobility
The finance industry’s big banks, insurers, and investment firms have historically enjoyed sizable VMware enterprise agreements, often with discounts in the 35–45% range off list price. These were massive, multi-million-dollar deals where VMware was willing to bend on price to secure long-term commitments.
Under Broadcom’s regime, however, those days are fading. Finance customers now encounter tighter discount ceilings, standardized bundles, and far less wiggle room. In many recent renewals, banks report being held to the 15–25% discount range at best, even for eight-figure contracts.
Why the squeeze? Banks and insurers are viewed as captive clients: they have deep pockets and, due to regulatory and operational risk, extremely low mobility away from VMware’s platform. Migrating off vSphere or re-architecting critical systems is a near-impossible sell to a bank’s risk committee.
Broadcom knows this. The vendor sees financial institutions as stable, high-revenue renewals – not as negotiation threats. Therefore, it pushes “standard” (higher) pricing, betting that finance customers will accept it rather than gamble on unproven alternatives.
Scenario Example: A global bank facing a €15 million VMware renewal had been accustomed to ~40% off under the previous VMware contract. Broadcom’s offer came back with an 18% discount.
When challenged, Broadcom pointed to its new “subscription standardization” policy – essentially saying everyone pays closer to list now. The bank, bound by strict compliance and with no time to re-platform, had little choice but to proceed at a dramatically higher cost.
Pro Tip: If you’re a bank, Broadcom assumes you’ll renew – at their price.
Read how to benchmark your renewal, How to Benchmark Your VMware Renewal Quote.
Healthcare Sector – Conservative, Compliance-Driven Buyers
Healthcare organizations – hospital networks, health systems, pharma companies – traditionally saw moderate VMware discounts (roughly 25–35% off) in their deals.
They aren’t as cash-flush as big banks, but historically, vendors acknowledged the budget constraints in healthcare and the critical nature of uptime by giving decent concessions.
Now, post-acquisition, even healthcare customers are seeing their discounts slashed to the 10–20% range. Broadcom has introduced rigid bundles (often pairing software with support services) and is enforcing standard pricing with minimal exceptions.
The healthcare sector is highly risk-averse. Provider IT teams prioritize stability and compliance (think patient data regulations like HIPAA), which means they rarely make bold moves to rip out core infrastructure.
Broadcom leverages this conservatism: knowing that a hospital will pay more for “peace of mind” to ensure continuity, the vendor feels little pressure to offer generous deals. Continuity of care and regulatory compliance become bargaining chips – implicitly, Broadcom’s message is “you need us to keep running safely, so our price is the price.”
Scenario Example: A European healthcare provider renewing its vSphere licenses found that Broadcom rolled its support contract into a new all-in-one subscription bundle. The result? The effective list price jumped ~30% overnight.
When the IT procurement team pushed back, Broadcom answered that the “simplified contract” ensured full compliance support and future-proofing – implying that any à la carte discounting would break this model.
In the end, the hospital accepted a far smaller discount than in the past, prioritizing the assured support and simplicity that Broadcom dangled.
Pro Tip: Healthcare pays for peace of mind — Broadcom prices it accordingly.
Tech and SaaS – The Outlier with Real Leverage
Not every industry is losing pricing power. Tech companies, SaaS providers, and other cloud-savvy businesses remain outliers in the VMware customer base – they often still negotiate from a position of strength.
In the past, these clients routinely secured 40–50% off VMware list prices, leveraging competitive alternatives and their own expertise. Even under Broadcom’s stricter regime, many tech-sector customers manage to obtain 25–30% discounts, which is notably better than what finance or healthcare customers are getting.
The reason is simple: credible alternatives and agility. If any customer can truly migrate away from VMware, it’s a tech company or a born-in-the-cloud enterprise. They likely have workloads ready to shift to AWS, Azure, or open-source hypervisors if pushed hard enough.
Broadcom knows that if it prices these clients out of range, they might actually follow through on moving off VMware – and that would mean not just lost revenue, but also lost market credibility.
Losing a high-profile tech logo to a competitor or to public cloud is a scenario Broadcom wants to avoid. As a result, tech firms tend to receive more flexibility – whether it’s extra discounts, shorter contract terms, or custom arrangements – to keep them in the fold.
These customers are also typically more aggressive negotiators. A SaaS company will bring up how easily they containerize apps to run on alternative platforms, or a telecom will reference their ongoing hybrid cloud pilot as a subtle threat.
That dynamic keeps Broadcom in check. In essence, if you can plausibly migrate, you can still negotiate a favorable VMware deal, even in the Broadcom era.
Pro Tip: If you can migrate, you can negotiate.
VMware Pricing Trends by Industry (Finance vs Healthcare)
| Industry | Historical Discounts (pre-Broadcom) | Broadcom-Era Range | Typical Procurement Behavior | Vendor’s Perception of Customer |
|---|---|---|---|---|
| Finance | 35–45% off list | 15–25% off list | Rigorous due diligence, but slow to change | “Captive and well-funded” |
| Healthcare | 25–35% off list | 10–20% off list | Cautious and risk-averse | “Compliance-bound” |
| Tech / SaaS | 40–50% off list | 20–30% off list | Aggressive, agile sourcing | “Potential flight risk” |
| Public Sector | 20–30% off list | 5–15% off list | Bureaucratic, budget-limited | “Budget-capped, low growth” |
Commentary: Finance and healthcare remain VMware’s revenue backbone – but in Broadcom’s view, that stability means higher prices, not better deals. Tech and other agile industries get more consideration because they might actually leave.
Meanwhile, public sector and similar customers with fixed budgets often see the smallest discounts of all under Broadcom, as they lack both funding and flexibility to negotiate deeply (and the vendor isn’t afraid to let smaller, low-growth accounts go).
Use RFPs to gain leverage. Using RFPs and Third-Party Quotes to Gain VMware RFP Pricing Leverage.
Geographic Pricing Patterns
Industry isn’t the only factor – geography plays a role in VMware’s pricing strategy as well. Broadcom’s pricing tactics show regional patterns, especially for finance and healthcare deals:
| Region | Typical Discount Trend (Broadcom-era) | Characteristics of Deals in Region |
|---|---|---|
| North America | ~20–30% off list | Most competitive market; stronger procurement culture and more aggressive negotiation by enterprises. Vendors expect pushback in the US, so moderate discounts are still common. |
| Europe (esp. in finance/health) | ~10–20% off list | More rigid contract cycles; many enterprises accept “standard” terms. Culturally, there’s often slower escalation on pricing disputes, so vendors hold the line and give smaller discounts. |
| APAC | ~15–25% off list | Highly variable. In mature markets like Australia or Japan, customers negotiate somewhat like North America. In emerging Asian markets, deals depend on local partners – sometimes yielding better bundles, other times very strict terms. |
| Middle East / Africa | ~10–15% off list | Generally smaller VMware footprints and fewer alternatives. Broadcom offers minimal flexibility; customers often face near-list pricing due to limited regional competition and less negotiation power. |
In short, your industry matters – but your region sets the ceiling on what discount you can achieve. For example, a tech firm in the U.S. might wrangle 25% off. In contrast, a similar tech firm in Europe might only get 15% off simply due to a different negotiation culture and regional policy.
Broadcom’s global pricing algorithm takes both vertical and geography into account, and even a “high-leverage” industry may see lower discounts if it’s in a region known for paying close to list.
Why Broadcom Leans on Industry-Based Pricing
Broadcom’s internal logic for VMware pricing is all about predictability and margin.
By segmenting customers by industry (and other factors like size), Broadcom can forecast revenue and enforce pricing discipline more easily.
Here’s how it breaks down:
- Finance & Healthcare: These regulated, stick-with-what-works sectors provide guaranteed renewals. Broadcom knows banks and hospitals aren’t dropping VMware anytime soon. So the strategy is to maximize margin on these accounts. It will push pricing toward the high end, confident that stability and compliance needs will outweigh any price objections.
- Tech & Telecom: These are volatile, “flight risk” sectors. A software company or telco might shift to a new technology on short notice if provoked. Broadcom cannot take them for granted. For these, the approach is to retain through flexible pricing – offering enough carrot (discounts, custom terms) to keep them from seriously considering competitors.
- Public Sector & Education: Organizations with fixed or limited budgets often have to buy what they can afford and stop there. Broadcom’s view is that chasing big discounts here doesn’t pay off in growth; these customers aren’t likely to expand much anyway. The result is low-complexity, low-discount deals – often very standardized, sometimes even at list price if that fits within budget. Broadcom would rather hold price and risk the customer downsizing or leaving, than deeply discount and set a precedent, especially given many public sector buyers have no alternative due to policy or legacy requirements.
By leaning on this vertical segmentation, Broadcom reduces the need for case-by-case exceptions. A sales rep has far less latitude now – they’re guided by an algorithmic pricing model that says “a large bank gets X% off, a hospital gets Y%, a tech firm maybe gets a bit more.” This approach replaces the old relationship-based deal-making.
In Broadcom’s VMware playbook, your industry profile is a key input to the pricing formula. In other words, the days of special treatment because you’ve been a loyal VMware customer are largely over; now it’s “What category do you fall into? Here’s your price.”
How Procurement Should Respond
Knowing that Broadcom is categorizing you and expecting you to behave a certain way, how can your procurement team push back?
Smart sourcing teams can counteract industry-based pricing biases with a few tactics:
- Benchmark beyond your own industry: Don’t limit your price comparisons to just your peers. If you’re in finance, quietly gather what tech firms or retailers are paying. Cross-industry insights can be your secret weapon. For example, if a cloud company got 30% off, use that as a benchmark in your negotiation, even if banks “typically” only get 20%. It challenges Broadcom’s assumptions.
- Cite internal cost pressures or transformation plans: If Broadcom assumes you have deep pockets or no options (as they do with many finance/health firms), counter that narrative. Highlight your organization’s mandate to cut costs or an upcoming cloud migration pilot. Make sure the vendor understands that you do have a Plan B, even if it’s painful – e.g., “Our board is reviewing our data center strategy next quarter.” This can reset their calculus about how secure your account really is.
- Run a structured RFP or evaluation: One way to break out of a “standard pricing” box is to formally evaluate alternatives. Even if VMware is likely to win, issuing a public RFP for virtualization or running a pilot with Hyper-V/KVM sends a message. It often forces Broadcom to seek exception approval for a better discount to win back your business in a competitive process. In short, create leverage by making the deal contestable.
- Demand clarity on pricing metrics: Don’t let Broadcom hide behind bundles and “value” messaging. Insist on transparency – for instance, ask “What’s the effective discount from list on this proposal?” and get it in writing. Often, Broadcom will bundle support or additional products and claim, “you’re saving 25% versus buying separately,” but the real effective discount on core components might be far lower. By pinning down the actual numbers, you can negotiate on facts, not marketing math.
- Align globally and negotiate as one: If you have a global footprint, coordinate across regions. Broadcom’s regional tactics vary, so a fragmented approach can leave money on the table. A unified global negotiation can offset a weak region with a strong one. For example, adopting a tough North American stance can help your European division, which might otherwise accept a low discount. Present a united front to prevent Broadcom from exploiting regional disparities.
Ultimately, don’t play directly into the “industry segment” stereotype Broadcom has assigned you. If Broadcom assumes you’ll pay more, arm yourself with data and alternatives to prove you won’t.
Effective procurement means rewriting the narrative – from a passive customer who fits their mold to an active negotiator who brings competitive tension to the table.
5 Rules for Understanding VMware Pricing Differences by Industry
- Industry identity drives price. Recognize how your sector biases your initial quote – and be aware of that bias when you enter negotiations.
- Finance and healthcare pay for predictability; tech pays for mobility. In other words, stable industries get charged a premium for stability, while agile industries get rewards for being able to move.
- Cross-industry benchmarks are your strongest weapon. Don’t confine your comparisons to your own vertical; the best negotiating insight might come from how a completely different industry secured a better deal.
- Use global alignment to offset local rigidity. If your region tends to get poor terms, lean on global coordination to bolster your position and break out of the regional pigeonhole.
- Leverage timing, not loyalty. Broadcom isn’t sentimental – a long relationship alone won’t win discounts. But well-timed actions (like early renewal discussions, competitive evaluations, or end-of-quarter pressure) can create openings that wouldn’t exist otherwise.
In summary, industry and geography significantly influence VMware pricing under Broadcom’s model – but they don’t have to dictate your fate. By understanding these patterns and preparing strategically, you can anticipate how you’ll be viewed and take steps to change the game.
Remember, your best pricing lesson may come from a completely different industry, so stay curious and informed beyond your own sector. With the right approach, even a “captive” customer can defy expectations and negotiate a better VMware deal.
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