Broadcom appears firmly in the crosshairs of European antitrust watchdogs, with European Union (EU) officials reportedly grilling cloud providers impacted by sweeping licensing changes.

Bloomberg reports that European cloud firms are being subject to questions from antitrust officials on the importance of VMware offerings and to what extent they could be easily replaced. Cloud service providers are also reportedly being asked for any new certification arrangements they might deem “unfair.”

Should the commission eventually decide to escalate the matter, it could launch a formal investigation or intervene more quickly with the option of imposing so-called “interim measures” – temporary orders that can only be implemented in the event officials find immediate risk of serious and irreparable damage to competition. These include ordering companies to pause at-issue practices for a short time.

Such measures, though, are rarely used, and in the event they ever are, legal challenges can be brought by the affected company, further slowing the process. Companies found to breach EU antitrust laws can be hit by fines of up to 10% of their global annual revenue, though such instances are few and far between.

Since its $61 billion takeover of VMware closed in late November 2023, Broadcom has instigated sweeping changes, many of which have caused consternation among some customers.

Ripping up perpetual license offerings to create subscription-based mass bundles resulted in customers purchasing subscriptions to services they don’t need just to access the ones they do.

Broadcom has also shuttered the Advantage Partner Program for VMware Cloud Service Providers (VCSP), replacing it with an invite-only system. The White Label model, which allowed smaller cloud service providers to work through Pinnacle or Premier partners, was also retired. And just last week, Broadcom pulled the plug on a software kit that allowed rivals to migrate virtual machines away from VMware.

Customer consternation has seen a considerable number of VMware users jump ship, much to the delight of Nutanix, Red Hat, and even some hyperscalers.

Broadcom, though, has consistently been defiant, maintaining an uncompromising stance amid VMware related-legal spats with disgruntled ex’s like Tesco, Siemens, and more recently, T-Mobile US.

CEO Hock Tan previously proudly proclaimed that more than 90% of VMware’s 10,000 largest customers have signed up for the vendor’s Cloud Foundation (VCF) platform. At the company’s recent Explore event in Las Vegas, chief product officer Paul Turner tried to paint the private cloud offering as a means to better manage surging token costs.

That hasn’t stopped Broadcom from being painted as public enemy No. 1 by the Cloud Infrastructure Service Providers in Europe (CISPE). The group took issue with the shuttering of VCSP, filing a complaint with the European Commission’s Directorate-General for Competition alleging that it would force many European communication service providers to exit the market.

Broadcom also recently lost out in a fight with EU antitrust regulators over access to documents it contended were covered by American legal professional privilege. The EU General Court sided with the bloc’s regulators, however, finding that “it is for the commission to decide whether a particular item of information is necessary to enable it to bring to light an infringement of the EU competition rules.”

Arista Networks is embroiled in a dispute over VeloCloud support services, mirroring customer grievances levelled against Broadcom, the brand’s former owner.

Managed service provider TPx Communications filed for Chapter 11 bankruptcy protection in late June as it sought to restructure, having accrued debts of around $1.1 billion. During the bankruptcy process, the company forked out for perpetual VeloCloud licenses and support to Arista to ensure its mission-critical infrastructure kept on running.

According to TPx, Arista throttled updates, security patches, and administrative access while dangling a $46 million, three-year subscription deal as the price of getting full service back – a steep rise considering that the company said it has paid $59 million for VeloCloud access since 2016.

TPx has taken a complaint to the courts, requesting a judge grant an order finding Arista to have breached its contract and that its restructuring efforts would “suffer irreparable harm.”

“The balance of hardships favours injunctive relief. Without an injunction, TPx faces substantial, irreversible harm, and Arista comparatively would experience little harm from having to return to its decade-long offering of services,” a Texas bankruptcy court filing reads.

TPx has been using VeloCloud for years to support offerings like its managed SD-WAN delivery platform. The company contends that a deal signed with former VeloCloud owner Broadcom in 2021 locked in prices after its subscription licenses converted to perpetual, along with three years of support.

But Broadcom sold VeloCloud to Arista last July for a price believed to be a cool $1 billion.

Having paid what it believed it owed Arista in the summer – some $2.34 million and a further $1.84 million for support – TPx alleges the vendor pulled the rug out from under them, going as far as to remove high-privilege account access, citing apparent security risks.

Arista argues that the amount paid by TPx covered license conversion as well as limited technical support, but not software upgrades, hosted orchestration, or other subscription-tier services. Such options required separate payment under a different contract clause, the vendor contends.

Arista says it did provide subscription-level services for about four months as a courtesy but warned in a letter that upgrade access would end May 20, and that its $46 million subscription quote already reflected a “significant discount” for TPx’s perpetual licenses.

The VeloCloud owner also objected to TPx’s bankruptcy efforts. A 98-page filing saw it challenge TPx’s attempts to hold onto VeloCloud contracts through bankruptcy, and claim it only gave Arista eight days to object after the restructuring-plan notice. The vendor also took issue with TPx for failing to list every relevant agreement, not disclosing potential-purchaser information, and not supplying financial projections for the reorganised company.

“[TPx] have provided virtually no adequate assurance information relating to the party that will purportedly perform under the Arista agreements post-assumption,” the filing dated July 21 reads.

The pair are set to duke it out before a court-appointed mediator. The case continues.

Former VeloCloud owner Broadcom has faced its fair share of customer legal actions after revamping VMware’s flagship Cloud Foundation (VCF) offering. The likes of Siemens, AT&T, and retail giant Tesco took action in the wake of licensing and support changes.

Just last week, the VMware parent pulled the plug on a software development kit (SDK) used by rivals to migrate virtual machines away from the platform, much to the chagrin of virtualisation competitors.

The European Commission is collecting information on how US technology giant Oracle licenses its software for cloud use.

A person familiar with the matter told Reuters EU antitrust regulators were seeking information from third parties about Oracle’s licensing practices.

However, the information-gathering exercise does not mean the company is formally under investigation. Regulators could use the evidence to build a case, or decide to take no further action if they find no wrongdoing.

The Commission has taken a similar approach towards German software company SAP, which agreed concessions in July to address concerns over its licensing practices.

The Commission has been cautious about confirming the details of its work on Oracle. A spokesperson said the regulator would continue to monitor potential anti-competitive practices and abusive conduct in the cloud sector, but stressed that there was currently no formal investigation into any company.

Oracle has faced complaints about its licensing and software audit practices for years, including from European customers.

Such disputes have generally been resolved through commercial agreements rather than antitrust proceedings.

Cloud computing has changed the nature of those concerns. Licensing conditions that make it significantly more expensive to run Oracle software on a rival cloud could influence a customer’s choice of vendor.

Similarly, contracts that are difficult to terminate could make it harder for businesses to switch providers.

Microsoft will phase out the current licensing structure for Azure VMware Solution (AVS). This will eliminate one option for organisations to use VMware in the cloud without licensing VMware Cloud Foundation (VCF) themselves. Existing customers have until August 2027 to transition.

Under the current version of AVS, the necessary licenses for vSphere, vCenter, vSAN, NSX, and other components are included in the service Microsoft provides. That model is being phased out. Starting October 31, 2026, Microsoft will no longer sell new AVS environments that include these VMware licenses.

Going forward, customers must have their own VCF license from Broadcom, reports The Register. They can then use it within AVS via the “Bring Your Own License” model, also known as AVS VCF BYOL. Existing users of the current setup must transition by August 30, 2027, at the latest. After that, their existing environments will no longer run the same way.

According to a new report from Taiwanese publication United Daily News (UDC) Microsoft is raising the cost of Windows license fees for hardware makers by a much higher amount than normal. According to the report, certain OEMs are seeing licensing price hikes of between 7% and 10%.

Usually, Microsoft raises Windows license fees for OEMs by a low digit percentage, making this 7% to 10% increase much more significant than normal.

“A PC brand executive stated that Microsoft increases licensing fees for Windows OEMs (device manufacturers) every year. In the past, licensing fees mostly increased by single digits each year, but starting in July this year, the average increase has reached 7% to 10%, which is a significant increase compared to previous years,” UDC says.

Of course, the cost of the Windows license fee is usually (at least partially) passed onto the consumer buying a computer, and UDC claims that their source says laptop pricing is already being impacted by these recent license fee increases. Microsoft charges different OEMs their own fees for Windows, so the exact increase in cost will differ for each hardware maker.

Regardless, with the ongoing memory component shortage, PCs have already seen astronomical price increases over the last year, with experts claiming that we haven’t yet seen the worst of it. With Microsoft raising prices higher than usual on Windows licenses, it feels like the Redmond giant is adding extra fuel to the fire.

To be clear, the Windows license fee price hikes only apply to OEMs building hardware that ships with Windows. The cost of buying a license for Windows 11 as a consumer remains unchanged, being $99 for Windows 11 Home and $199 for Windows 11 Pro.

The ongoing component crisis has made computing unaffordable for many people. PCs that used to target the $600-$800 price bracket now cost close to $1,000. And flagship Windows laptops that used to cost $1,200-1,500 are now closer to $2,000. Even Apple has been hit by the shortage, being forced to raise prices by hundreds of dollars across its Mac line-up. Microsoft’s own Surface line was hit especially hard, with the flagship Surface Pro and Surface Laptop being $400-$500 more expensive than the last-gen models.

Microsoft is moving parts of its AI portfolio beyond pure per-seat pricing by pairing user licenses with charges tied to usage. The hybrid model keeps recurring seat fees in place while adding a variable billing unit as customers consume more AI capacity.

That model is beginning to show up in Microsoft’s financial results. Dynamics 365 Customer Service credit consumption rose fourfold quarter over quarter, while GitHub Copilot generated what Microsoft called “significant consumption revenue” after its June billing change.

Microsoft also reported more than 30 million paid Microsoft 365 Copilot seats, with net additions more than doubling from the previous quarter, and said GitHub continued adding Business and Enterprise seats.

Software giant VMware is suing an Italian distributor for around €30 million in damages, claiming in a London court that the company failed to ensure a customer agreed to delete old software licenses during an upgrade plan.

VMware said Computer Gross should have required Italian bank Intesa Sanpaolo to agree to VMware’s licensing terms when it sold the bank VMware’s cloud computing software, according to a newly public High Court claim.

Computer Gross had previously bought the rights to resell the software, the claim says.

VMware said that under its terms, Computer Gross was required to ensure that Intesa deleted its old software licenses once it had the updated versions. But Computer Gross failed to do so, and Intesa confirmed that it never agreed to those terms, according to the claim.

VMware said that it gave Computer Gross an 82% discount on the standard resale agreement, based on the expectation that Intesa would retire its existing perpetual licenses, according to the filing.

The list price of the software was €36 million, but Computer Gross paid only €6.6 million, resulting in a discount worth €29.4 million, the claim says.

VMware said Computer Gross should have prevented the license duplication. By not doing so, Computer Gross essentially sold the software at a heavily discounted price.

As well as damages for the allegedly unauthorised price cut, VMware is seeking an order to prevent Computer Gross from continuing separate civil proceedings in Milan, the claim says.

Computer Gross breached a jurisdiction clause in its contract with VMware when it asked the Italian court to confirm that it did not owe VMware compensation over the software deal, according to the claim.

ValueLicensing (VL) has been invited to attend a case management conference in a related multibillion-pound collective action against Microsoft, according to the reseller’s boss, Jonathan Horley.

VL sued Microsoft for £270 million in 2021, alleging that the software giant restricted the supply of surplus Office licenses available for resale. Barrister Alexander Wolfson is the proposed class representative in a separate claim filed in 2025 on behalf of more than two million UK customers. That action seeks between £1.3 billion and £3.5 billion in compensation.

Both cases are before the UK’s Competition Appeal Tribunal (CAT) and concern Microsoft’s alleged efforts to restrict the market for pre-owned software licenses.

Case management conferences (CMCs) are used to set timetables and decide procedural questions as a case progresses.

According to Horley, ValueLicensing has a CMC concerning disclosure listed for September 14, followed the next day by an invitation to another in the Wolfson proceedings.

The September 15 CMC could address how the two proceedings interact, including whether the Wolfson action should be stayed pending judgement in the more advanced ValueLicensing case. There is also the possibility that the claims could eventually be heard together, although the tribunal has yet to indicate what course it will take.

ValueLicensing’s case is considerably further ahead of Wolfson’s. The Court of Appeal dismissed Microsoft’s appeals on issues including copyright in July, although Microsoft can seek permission to appeal to the Supreme Court.

Kate Pollock, head of competition litigation at law firm Stewarts, said of the Wolfson case earlier this year: “Microsoft’s conduct has had a profound and costly impact on millions of individuals and private and public sector organisations that rely on its software for daily business operations.

“We believe that Microsoft abused its market dominance by imposing restrictive licensing practices that effectively shut down competition and inflated prices.”

Closer procedural links between the cases could complicate Microsoft’s defence against two claims arising from similar allegations.

VL’s Horley said: “Following on from the judgement at the Court of Appeal we are pleased to have a hearing listed for September 14 to progress further disclosure. ValueLicensing has also been invited to the first hearing of the Alexander Wolfson class action on September 15. That will deal with the next steps for certification and the interactions between the two claims.”

Horley said the move was “very significant” and showed the progress ValueLicensing had made in terms of the competition and copyright law aspects.

“ValueLicensing are experts in the pre-owned Microsoft market with significant evidence and experience of the operation of the market during the relevant period in which the abuse is alleged to have occurred,” he said.

“Given that both claims relate to the pre-owned Microsoft market, that the ValueLicensing claim is so advanced and Mr Justice Turner is Chair for both, it is logical for ValueLicensing to be invited. ValueLicensing is happy to assist the Tribunal in determining the next procedural steps for both actions.”