Western Union is an old company, but not too old to change its ways as evidence by a recent decision to migrate its cloud services away from long-time vendor VMware to Nutanix, a process Brandon Shaw, VP and head of technology services at the now 175-year-old-firm, said it did not take lightly.

Shaw provided some background on that process during a panel presentation at the recent Nutanix .NEXT event, where he noted the firm had been collecting a deepening debt load over its history that had to be dealt with. That debt load had resulted in approximately 4,000 cores running in various data centers and assets around the world that were supporting upwards of 1,200 services and applications “doing various activities around the world.”

“The motivation for doing this, … we had to do something, and so we could upgrade our existing aging virtualization hypervisor platform, VMware, and kind of continue the status quo, or we can start to look at what our strategy is as a company,” Shaw said.

The tech executive noted that this strategy was to find a way to gain more flexibility in managing its disparate applications. As with many firms that chased the “shiny cloud bug when it hit them,” Shaw noted that this included pushing everything over to the cloud, where now many firms need to migrate some of those workloads back to an on-premises environment.

This need ran into Broadcom’s service and pricing changes for long-standing VMware services that resulted in “the new economic structure that VMware, or Broadcom, is using. Certainly that had a significant part in it,” Shaw said.

Western Union was using several products from VMware, including vSphere, but “at a certain point we had to make a decision on, do we keep going down this road or do we decide to build a new road and change our strategy altogether as far as how we're managing virtualization?” Shaw explained. “And that's really how we did it.”

The firm did have “lots of discussions” with Broadcom that Shaw said were not “contentious or anything like that,” but “where there was assistance and we have decent lines of communication, what we feel like we have now are true partnerships and this symbiotic desire to help us succeed and not just getting another name on the board.”

Services and long-term support

As for what Nutanix services Western Union plans to use, Shaw noted “we are early on. We're in the analysis phase right now, and really kind of sorting and stacking and figuring out the order with which we're going to be lifting and moving stuff over.”

Shaw did admit that Western Union’s management was “very concerned” about ongoing support once the migration to Nutanix is complete, something that eventually came back to haunt the firm following Broadcom’s purchase of VMware, but that those issues were tackled by the firm’s legal team as it drew up the initial paperwork.

“There was a commitment to really make sure that it was spelled out really clearly in the papers,” Shaw said. “And so that helped us to feel confident and comfortable with the longevity of our deal.”

Shaw added that Nutanix’s recent growth also provided confidence, especially in terms of the vendor’s success in migrating disenchanted enterprises.

“We looked at the success and the offering that they have, and really the niche market that they have is taking over from some of those Goliaths that are in the market, and for us, being one of those long-in-tooth companies, we're okay with working with a company that's up-and-coming and really showing that their core DNA is growth, not necessarily just to create a shiny product that can be sold,” Shaw said.

Westward ho!

Western Union’s move echoes that of thousands of former VMware customers that have decided to migrate to other vendors in light of Broadcom’s changes.

Nutanix CEO Rajiv Ramaswami noted during the vendor’s event that Broadcom has an “installed base of probably 300,000 customers or so,” and “we are targeting about 165,000 of those customers … and we have a segmented approach to going after those customers.”

Those numbers align with analyst estimates that more than 100,000 VMware customers could eventually leave that vendor.

Equity research firm William Blair previously mentioned that market research firms were predicting up to 30% of VMware’s installed base of more than 400,000 customers “will eventually switch away from VMware.” That sentiment was echoed by Forrester Research Principal Analyst Naveen Chhabra who told SDxCentral up to 20% of the world’s largest enterprises “will start to exit – read these words very carefully – will start to exit the VMware stack.”

“They will not do a full replacement overnight, but in parts, they will start to move away,” Chhabra said. “I clearly see that happening right now and I don’t need to go another five months to claim that that prediction was true. It is happening.”

Broadcom, for its part, has remained confident of its VMware stewardship, with CEO Hock Tan repeatedly touting the firm’s ability to get more than 90% of VMware’s 10,000 largest customers resigned to new contracts. Most of these have been tied to VMware’s bolstered Cloud Foundation (VCF) platform.

However, the vendor’s most recent earnings showed muted growth from its VMware-housed software business. That division posted just 1% year-over-year growth during the quarter, an amount that was down significantly from the 19% growth posted during the final fiscal quarter of last year and the 47% growth reported for the first quarter of fiscal 2025.

Despite the slowed growth, Tan touted that VMware-specific revenues increased 13% year-over-year during the most recent quarter, with total bookings during the quarter in excess of $9.2 billion, and the executive also dismissed any notion that AI-type services have impacted this business.

“Let me reinforce that this growth in our infrastructure software business reflects our focus and investments in foundational infrastructure, and our infrastructure software is not disrupted by AI,” Tan said. “In fact … VCF is the essential software layer in data centers, integrating CPUs, GPUs, storage, and networking into a common, high-performance private cloud environment as the permanent abstraction layer between AI software and physical chips. … VCF cannot be dis-intermediated or replaced.”

Tan added that enterprises will come to rely more on VCF to help “scale complex, generative AI workloads effectively with agility that hardware alone cannot provide. We are confident that the growth in generative and agentic AI will create the need for more VMware, not less.”