- European Commission’s approval of Broadcom’s acquisition of VMware criticized
- CISPE is concerned about rising prices and software bundling. and lockouts for customers
- Commission may have to reassess deal if canceled
CISPE argued that the European Commission failed to assess clear and publicly known risks when it approved Broadcom’s July 2023 acquisition of VMware.
For example, the company’s CEO previously pledged to increase VMware’s standalone EBITDA by about 80% in a market that’s only growing about 8% annually, which CISPE said could only come from steep price increases, forced consolidation, and customer exploitation – not organically.
CISPE also criticized Broadcom for financing the deal with approximately $28.4 billion in new debt and $8 billion in VMware debt, creating “a powerful financial incentive to quickly extract cash from VMware’s installed base.”
The European cloud provider group also warned that some anticipated risks have since materialized, with soaring prices, forced multi-year subscriptions and bundled VMware products increasing costs for European cloud providers.
When the Commission approved the deal, Margrethe Vestager, vice-president for competition policy, stressed that Broadcom’s only rival in this area, Marvell, would not be affected by anti-competitive behavior. However, the Commission did not comment on costs for customers.
“The Commission looked at this merger with half-closed eyes and declared it safe. By rubber,” CISPE Secretary General Francisco Mingorence said in the group’s latest statement. “Brussels gave Broadcom a blank check to increase prices, retain and retain customers.”
Earlier in December 2025, CISPE filed a complaint against the European Commission’s approval of Broadcom’s acquisition of VMware. CISPE’s three main criticisms are that Broadcom’s dominant position and its harm to competition were not properly assessed, that the risks associated with the merger were poorly managed, and that the impacts on innovation were not properly studied.
“Not only cloud service providers, but also hospitals, universities, and municipal authorities are all now facing unaffordable bills and inflexible long-term commitments that jeopardize the flexibility and affordability of their cloud infrastructure,” Mingorance wrote in July 2025 when CISPE announced it would take legal action against the Commission to overturn its approval.
In the event of cancellation, the European Commission should review the agreement under current market conditions.
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