Enterprise Impact

Assessment
Trigger Event: Broadcom acquisition
of VMWare

A&IS Strategy & Integration Services

August 2022

1
Trigger Event: May 26, 2022, Broadcom announces $61B acquisition of VMware

Kyndryl POV:
Broadcom’s Motivation & History
Potential Impacts to Clients
• Price increases for VMware product
1. Become major player in overall IT industry, expand
from semiconductors to enterprise infrastructure software
subscription or perpetual licenses (Highly Likely)
2. Expand existing software portfolio and rebrand as
“VMware” • Reduction in investment in existing product
3. Grow revenue and improve profitability - through roadmap – e.g., Security suite (Probable)
recurring revenue growth from workload expansion
• Reduction of partners and the partner
Recent Acquisitions: ecosystem (Unlikely)
• 2018 Computer Associates (CA) for $18.9B
- Significantly increased product prices
- Significantly increased support prices
• Impact to enterprise resourcing and planning
(Highly Likely)
• 2019 Symantec Enterprise Security for $10.7B
- Significantly increased product prices
- Significantly increased support prices

2
How We Can Help: Kyndryl Enterprise Impact Assessment
Key Steps and Estimated Timeline (scope dependent)
Kyndryl Value Proposition
Business Assessment
Help clients further understand the potential risks in their environment and
Risk Review &
provide a blueprint to mitigate identified risks. Additionally, help clients Recommendations
maintain and optimize their steady state or help them to transform their IT weeks
Technical Assessment
models to best align to their business needs. Finally, act as advisory
partners to our clients irrespective of the path forward. 0 3 6
Weeks
Activity What We Do Deliverables

• Understand business context enabled by IT environment • Business & Operating Model Context
• Review current IT operating model, fin ops model, and cloud • Business Dependencies on VMware
Business
posture
Assessment
• Assess impact of current and planned VMware spend across LoBs • Potential Financial Impacts
and functions
• Assess potential risks - including skills and 3rd party dependencies
• Discover the VMware products / services in production / development • High-level infrastructure overview
environments, versions and perform compatibility mapping • Application baseline & Infrastructure to application
Technical
• Identify existing apps, data, cloud platforms and services dependent mappings
Assessment
on VMware • Overview of infrastructure tooling
• Analyze key agreements including licensing, lifecycle management • Shared Services Landscape
and the impact of POCs involving VMware products
• Collaborate to analyze risks, impacts and define mitigating actions • Business and Technical Risk Registers With Mitigating
Risk Review &
• Co-create alternative solutions Actions
Recommendations
• Define the associated skill, contractual and financial implications • Scenario-based Solutions and Blueprint Alternatives
of alternatives • Benefit and Investment

($250k / 8-week Assessment) 3

VMWare Portfolio and Market Alternatives
VMWare Suite covers virtually all enterprise IT domains and Kyndryl uniquely
well-positioned to provide client guidance across the VMWare portfolio

Cloud Services Security portfolio

VMWare Market presence: High
VMWare Market presence: Low
Kyndryl coverage: Yes Kyndryl coverage: Yes

Telco Cloud portfolio

VMWare Market presence: Low
Kyndryl coverage: Yes

VMWare Market presence: Medium

VMWare Market presence: Low

VMWare Market presence: Low
VCPP portfolio

Emerging portfolio
VMWare Market presence: Low

Services portfolio
Kyndryl coverage: Yes
Kyndryl coverage: Yes
Alternatives to VMware Products/Technologies

Kyndryl coverage: Yes

Open Source
End User Computing Services
Tanzu portfolio VMWare Market presence: High Customers Key Use Case Scenarios
VMWare Market presence: High Kyndryl coverage: Yes
VMware Product VMware Product/ Run legacy workloads Application Automated Device protection, Telco cloud Edge devices to
Kyndryl coverage: Yes Viable Alternative(s) to VMware
Category Technology on Virtualized Modernization in deployments management and orchestration and Central site
Infrastructures private and/or Public of Enterprise desktop automation connectivity
clouds and/or Edge workloads virtualization
CMP portfolio vSphere ESXi 1. Nutanix Prism: AHV x x
VMWare Market presence: High 2. Hyperscaler Compute services
Kyndryl coverage: Yes Virtualization VMware HCI: 1. Nutanix HCI: AHV, Flow, AOS x x
Portfolio vCenter, NSX, VSAN 2. Red Hat RHHI
Virtualization portfolio 3. Hyperscaler Native Services (compute,
VMWare Market presence: High Storage, Network)
Kyndryl coverage: Yes Cloud VMware vRA and vRO 1. Nutanix NCM (aka CALM) x
Management 2. Red Hat CloudForms
Portfolio
VMware Tanzu 1. Red Hat OpenShift x
Tanzu Portfolio 2. Hyperscaler native K8S (AKS, EKS, GKE)
3. Nutanix Karbon
VMC on AWS, AVS, 1. Nutanix Cloud Clusters (NC2) on AWS x
Multi Cloud
GCVE and Azure
Services Portfolio
2. Hyperscaler Native Services
Horizon 1. Citrix Xen Desktop (VDI) x
2. Azure Virtual Desktop (AVD)
End User
Computing (EUC)
Portfolio Workspace One 1. IBM MaaS 360 x
2. Microsoft Endpoint Manager
3. Citrix Endpoint management
Telco Cloud Telco Cloud Platform 1. Red Hat OpenStack + PAM+ Ansible + x
Portfolio OpenShift
Carbon Black 1. Symantec Endpoint Protection x
2. Microsoft Defender Endpoint
Security Portfolio
3. McAfee Endpoint Security
4. Hyperscaler native Security Services
SASE/SD-WAN 1. Cisco Viptela x
2. Palo Alto
Edge Portfolio 3. Hyperscaler SD-WAN partners
Edge 1. Azure Stack Edge, IOT Edge x
2. AWS Edge Services
Enterprise Impact Assessment - Overall Approach
Enterprise Impact Assessment Overview Assessment Deliverables
Prepare Assess Plan
Phase 1- Readiness Phase 2 – Discovery & Phase 3 – Deep Dive & Phase 4 – Risk Mitigation Application Dependencies
Initial Insights Risk Assessment

• Technology and Scope overview
of services
• Scope definition
• Initial Data collection
• Assessment Tooling needs
• Agree any collocation
requirements and Travel
planning
• Execution of all assessments
• Data collection – Business,
Technical
• Financial and vendor
compliance review
• Infrastructure mapping
• Service dependencies
• Initial Analysis and Insights
• Deep Dive Analysis • Risk mitigation planning Platform and Infrastructure
• Peer Reviews • Compile report &
deliverables
• Cross Technology and • Findings
Business Review Sessions
• Recommendations
• Risk identification &
scoring • Actions and Priorities
Architecture

Week 0-1 Week 2 - 3 Week 4 - 5 Week 6 - 8

Compatibility
al t
m
er i t Fin por
In t p o r Re
Re
Risks and Mitigation

Client Example Disposit ion Analysis

Remediation
Options
Case Study – Global Insurance Company
Assessment Scope
Kyndryl engaged to assess the
business and technical impacts of the
Broadcom acquisition of VMware.
• Assess impact of current and planned VMware
spend across LoBs and functions
• Assess potential risks - including skills and 3rd
party dependencies
• Discover the VMware products / services in
production / development environments,
versions
• Identify app, data, and service dependencies
on VMware
• Analyze risks, impacts and define mitigating
actions
Confidential
Assessment Findings
Long-standing VMware customer with
strong internal infrastructure expertise.
Limited current internal resource skills in
alternative technologies.
Significant vendor concentration in
combined Broadcom / VMware company.
Primary VMWare portfolio usage –
Virtualization, Cloud Management, End-
User/WorkspaceOne, and
Security/Carbon Black.
Significant dependence on VMWare for
on-prem and cloud infrastructure globally.
Several mission critical services
dependent on VMWare software.
Key Risks
• Vendor concentration policy may drive
need to diversify beyond VMware for
select product areas.
• High risk that Carbon Black will be
EOL post acquisition.
• Post acquisition price increases could
have a significant impact on operating
costs.
• Critical systems dependencies and
limited alternative technology internal
experience magnify financial
dependence risk due to complex
migration path.
Mitigation Approaches
• Overall comfort and expertise with
VMWare tools most significant risk is a
financial risk if significant price
increases materialize.
• Mitigation 1: Seek to extend current
VMware ELA to lock-in current
economics.
• Mitigation 2: Develop and test
alternative technology platforms to
provide negotiating leverage and
establish a viable path if required.
• Concentration Risk Mitigant: Seek
alternatives to CarbonBlack security
suite.
6
6