Google is touting price superiority to Microsoft in the increasingly heated battle for VMware customers looking to migrate workloads to public cloud environments post-Broadcom acquisition, which is a battle that has so far not garnered a direct response from market heavyweight Amazon Web Services (AWS).

Google’s pricing claim is based on the commercial launch of its VMware Cloud Foundation (VCF) product that acts as a cloud support system for VMware infrastructure. This basically allows Google’s Cloud VMware Engine to support all of VMware’s recently updated Cloud Foundation services.

Google said its offering provides for 20% lower commitment pricing; support for VCF license portability that can result in up to a 35% lower cost when moving workloads from on-premises to a Google cloud environment compared to VMware’s pre-Broadcom license model; and commercial incentives of up to 40% of first-year spend on the Google VMware platform to further tempt workload migration.

Overall, Google is claiming that new node types and incentives can provide up to 30% less total costs for running VMware in its environment compared to Microsoft’s Azure VMware offering.

Specifically, Google claims that for one of its new node types running on a three-year prepaid commitment is priced at $3.60 per hour compared to a workload, term, and running in a similar Azure location that would run $5.17 per hour.

Microsoft made a similar move earlier this year through VMware’s Rapid Migration Plan that provides licensing benefits and a level of price consistency for workloads moved to the Azure VMware Solution platform.

Microsoft’s take on that migration program is offering users access to reserved instances at a set price over a set term of one, three or five years. These reserved instances are basically a way for a customer to pay upfront for the use of instances to run an application in Azure as opposed to a pay-as-you-go model, with the benefit of the reserved model charging less per instance.

Microsoft is incentivizing the reserve push by offering a 20% discount on Azure VMware Solution for customers purchasing a new one-year reserve instance term if that purchase is made before the end of the year. The hyperscaler also noted the five-year option will only be available for purchase through the end of June.

Microsoft is also providing up to $120,000 in Azure credit for customers that purchase a new reserved instance plan. This credit can be used for the Azure VMware Solution or other Azure services.

Broadcom and AWS remain at arm’s length AWS has so far not publicly joined this pricing battle, and if anything remains at arm’s length to VMware’s new Broadcom model. This includes a move earlier this year by Broadcom to take over distribution of its VMware Cloud on AWS product from the hyperscaler.

Broadcom CEO Hock Tan highlighted the move in a blog post, explaining that VMware Cloud on AWS “is no longer directly sold by AWS or its channel partners.”

“It’s that simple,” Tan curtly wrote. “What this means is that customers who previously purchased VMware Cloud on AWS from AWS will now work with Broadcom or an authorized Broadcom reseller to renew their subscriptions and expand their environments. Customers who have active one- or three-year subscriptions with monthly payments that were purchased from AWS will continue to be invoiced by AWS until the end of their term.”

The move comes despite the VMware Cloud on AWS platform being a critical success for VMware.

Tan wrote in his blog post that the decision was prompted by what he claims were erroneous reports that the VMware Cloud on AWS product was on the chopping block.

“Unfortunately, there have been false reports that VMware Cloud on AWS may be going away, which is causing unnecessary concern for our loyal customers who have used the service for years,” Tan wrote. “We are acting quickly to correct this misinformation. … I’m pleased to report the service is alive, available and continues to support our customers’ strategic business initiatives just as it always has.”

Broadcom’s tighter integration with Microsoft and Google could also help those hyperscalers claw closer to their larger rival. Recent analyst reports have shown Microsoft’s Azure platform and GCP gaining market share ground on AWS.

Synergy Research Group (SRG) reported that AWS continued to be the biggest public cloud revenue hog, sucking up 31% of market revenues during the first quarter of this year. However, that share was down slightly from the 32% share AWS garnered for the first quarter of 2023.

Microsoft, in contrast, managed to grow its market share from 23% last year to 25% this year, while smaller rival GCP increased its share from 10% last year to 11% this year.

“Amazon maintains a strong lead in the market though Microsoft and Google had the stronger year-on-year growth numbers,” SRG noted in its report. “All three saw their growth rates increase substantially in the last two quarters.”

Why the VMware pricing battle? This incentive battle is being fought over long-time VMware customers that might be looking at ways to curb an expected increase in VMware pricing due to Broadcom’s wide-ranging license changes.

Forrester Research recently released a report that found “one VMware client shared that they’re experiencing a 500% price increase based on their current use of VMware products and how it maps to the new licensing and packaging.”

Broadcom’s Tan recently crowed that the vendor has signed up “close to 3,000 of our largest 10,000 customers” to VMware’s new subscription licensing model. Tan added that “each of these customers typically sign up to a multi-year contract.”

“We’re making good progress,” Tan said of its move to sign legacy VMware customers to the new licensing model. “The journey is not over, by any means, but it’s very much to expectation moving to subscription.”

Some of Broadcom’s rivals have noted that progress has been goosed by Broadcom being willing to bargain on pricing.

“We’ve seen Broadcom display a lot of flexibility with respect to their pricing, their packaging changes, especially when they are faced with the probability of losing some of their larger customers or responding to push back from the market and from the customer base,” Nutanix CEO Rajiv Ramaswami said during that vendor’s most recent earnings call.

While some analysts have highlighted the financial strain Broadcom’s moves are having on many enterprise customers, others have also noted that the changes could end up being better for all involved.

“It may actually be a win-win in terms of maybe Broadcom cares more about the quality of the profits than the size of the revenue, and that’s [Broadcom CEO Hock Tan’s] style. And if that’s the case, then he wins.” Roy Chua, founder and principal at analyst firm AvidThink, told SDxCentral in a recent interview on the evolving market dynamics. “And the customers may win because the customers who don’t want to pay the premium for VMware end up paying that revenue stream to someone else. And maybe they’re happy with it, because they don’t feel like they’re locked in. So it could be an interesting evolution in the market that I wasn’t expecting.”