Dell wants £10m+ from VMware if Tesco wins

Yet another story that's perfect podcast material IMO.

https://www.theregister.com/2026/01/15/dell_vmware_claim_tesco_case/?td=rt-3a

In 2021 Tesco purchased VMware vSphere Foundation and VMware Cloud Foundation from Computacenter, which is a reseller of VMware. Now, in the murky world of IT sales, there are often many intermediaries, and in this case, DELL was the Distributor for VMware.

Broadcom purchased VMware and therefore believes it has the right to discontinue the "Perpetual License" and move to a subscription-based model, something everyone in the IT industry is doing to generate recurring revenue.

Reading between the lines, Broadcom set the version of VMware vSphere/ESXi 7.x Tesco is running to EOL (End Of Life), the whole point of a perpetual license is that while it's expensive, you'll get updates, such as bug fixes and program enhancements for free forever and ever, amen. Now, like all vendors, Broadcom want to maximise their investment so they'll make far more money charging a subscription, which they can increase over time, than honouring a one-off payment.

Responsability

Most people beleive that the point of sale is responsible. "I bought it from you!" This is because people are used to returning goods to shops; however, the ultimate responsibility is with the manufacturer. Your shop generally takes ownership of the problem to maintain good customer relations. The reason Tesco is suing DELL is that Computercentre probably said: "Don't blame us, guv'nor, we bought it from DELL!" I suspect that's merely a tactic to get DELL to pick a fight with Broadcom, hence DELL has said: "Oi, Broadcom, this is all your fault."

I'm no lawyer, but I would say responsibility lies with Broadcom. The problem for them is that if they do a U-turn and agree to support Tesco, everyone else is going to be knocking on their door, clutching their vSphere licenses and demanding support.