Broadcom’s controversial changes to VMware’s software licensing program has been blasted by a European-based cloud infrastructure group that has called for regulators to impose new rules on Broadcom’s enforcement of contract terms.

The Cloud Infrastructure Services Providers in Europe (CISPE) trade group has asked European regulators, legislators and courts to look into Broadcom’s move in “unilaterally cancelling license terms for essential virtualization software.” This is connected to Broadcom’s push toward revamping VMware’s legacy perpetual licensing deals it had with third-party resellers and enterprise customers.

The group claims that Broadcom’s move will impact the viability of some of its members that rely on licensing and using VMware products.

“Several CISPE members have stated that without the ability to license and use VMware products they will quickly go bankrupt and out of business,” CISPE noted in a statement. “Some state that over 75% of their revenues depend on VMware software virtualization technologies. End customers, ranging from large national champions and public sector services to SMEs and start-ups, report that they will not be able to deliver some or all of their online services if this licensing issue is not resolved. In some cases, these include vital medical services.”

The group explained that VMware controlled almost 45% of the virtualization market last year, which puts Broadcom in a position to dictate contract terms, the availability of products and which third-party vendors are allowed to offer those services.

“Hundreds of products have been removed with no notice, and the remaining ones re-bundled through new contract terms, without any technical modifications or software developments in ways that unfairly increase costs for customers,” CISPE added. “In addition, vendors are unsure if they will even be invited to participate in Broadcom’s new partner programs. Those that are invited feel pressured into accepting unfair licensing terms by the short deadlines imposed to sign. New terms include minimum commitments amounting to tens of millions of Euros over three-year periods. Costs for licenses have increased by a factor of 12 (i.e.1,200%) in some cases.”,

CISPE wants regulators to enact an immediate pause to contract terminations and allow for Broadcom’s VMware customers to be able to exit multi-year contracts with Broadcom “as soon as viable alternatives become available.”

Analysts had warned Broadcom’s acquisition and subsequent changes to VMware’s licensing structure could impact end users.

“These partners are mad,” Tracy Woo, principal analyst at Forrester Research, told SDxCentral in an interview earlier this year. “They’re mad because they’re partners and they weren’t given more notice than like a day or maybe just an email and that was it. That is very Broadcom-style, it’s very matter of fact and we don’t make any apologies for it.”

Woo said the move has,  in turn, created concern for end users that have traditionally engaged with VMware products and services through those partner channels and are now deeply tied into the VMware ecosystem stack.

“I just talked to a client that wasn’t really impacted by the new partner program because it uses a partner that was accepted into the new program, but they are really worried about everything that is going on,” Woo said. “And that call was about how to create a business case to tell to their executives as to why they should be moving off of VMware and also they needed a list of alternatives.”

Broadcom late last week moved on its VMware licensing plans when it rolled out its new partner strategy for VMware’s Cloud Foundation (VCF) platform. It’s based around Broadcom’s Advantage Partner Program that launched early last month.

Broadcom CEO Hock Tan did hint in a recent blog post touting the first 100 days of the deal that there have been some challenges, but claimed they would benefit all long term.

“Of course, we recognize that this level of change has understandably created some unease among our customers and partners,” Tan wrote. “But all of these moves have been with the goals of innovating faster, meeting our customers’ needs more effectively, and making it easier to do business with us. We also expect these changes to provide greater profitability and improved market opportunities for our partners.”

The European Commission (EC) last summer approved Broadcom’s acquisition of VMware following an “in-depth investigation” that resulted in concessions from Broadcom.

That investigation was primarily concerned that the deal “would harm competition in the worldwide market for the supply of [fiber channel host-bus adapters],” with a particular focus on Broadcom being able “to foreclose Marvell, the only rival on the market for the supply of FC HBAs, by restricting or degrading the interoperability between VMware’s server virtualization software and Marvell’s hardware.”

In response, Broadcom offered to guarantee access to its APIs and technical support for the development and certification of third-party FC HBAs, including access via an open-source license to the source code for all of Broadcom’s current and future FC HBA drivers; interoperability with VMware server virtualization software; and providing third parties access to this information at the same time that Broadcom gains access.

The VMware licensing issue was also noted as an area of that investigation, with an initial concern that “Broadcom may start bundling VMware's virtualization software with its own software (namely mainframe and security software) and no longer offer VMware's virtualization software as a standalone product, reducing choice and potentially foreclosing rival software providers.”

However, the EC eventually concluded in approving the deal that “Broadcom would not be able to bundle VMware's virtualization software with its own software (namely mainframe and security software) as such products are purchased by different divisions in a customer organization and/or at different points in time.”