If your organization is still running VMware workloads, the math has changed significantly. Broadcom’s acquisition of VMware brought sweeping licensing changes that have left mid-market IT teams with higher costs, fewer options, and a tighter timeline than they planned for. The good news: Azure offers a well-supported, cost-effective migration path from VMware, and organizations that move with a plan are coming out in a better position than they were before the acquisition.
What Broadcom’s acquisition did to VMware licensing
The changes that followed Broadcom’s $61 billion acquisition of VMware in November 2023 have been substantial. Perpetual licensing was eliminated entirely. Industry reports now show price increases ranging from 150 to 1,200 percent for customers transitioning from perpetual or standalone licenses to Broadcom’s new subscription model. As of April 2025, Broadcom mandates a minimum of 72 CPU cores per purchase, meaning a server with far fewer cores in production may still require licensing for the full 72.
For mid-market organizations, this is not a nuisance. It is a structural cost increase that has forced a real conversation about whether staying on VMware makes financial or strategic sense.
The answer, for many, is no.
Why Azure is the logical migration destination
Organizations looking to exit VMware are evaluating multiple paths. Azure has emerged as the leading destination, with its strong integration with VMware workloads, competitive pricing, and the Azure VMware Solution (AVS) offering organizations a bridge strategy that does not require immediate full re-architecture.
For mid-market organizations already invested in the Microsoft ecosystem, Microsoft 365, Dynamics 365, or existing Azure workloads, the migration path is particularly well-supported. You are not moving to an unfamiliar platform. You are consolidating onto one you already use.
The key differentiators that make Azure the right destination for VMware migration:
- Azure VMware Solution (AVS): run existing VMware workloads natively on Azure without immediate re-architecture, giving your team time to modernize on your own timeline
- Consumption-based pricing: pay for what you use, not a 72-core minimum regardless of actual utilization
- Built-in security and compliance: governance tools, RBAC, and compliance frameworks built into the platform rather than managed separately
- Microsoft ecosystem integration: native connectivity with Microsoft 365, Dynamics 365, and the full Azure service catalog
The risk of a lift-and-shift without a plan
Moving VMware workloads to Azure without a structured approach is where organizations run into trouble. Migrating inefficient on-premises architecture directly to cloud creates expensive cloud inefficiency, you eliminate the VMware licensing cost and replace it with oversized Azure spend.
The organizations that come out ahead are the ones that treat VMware migration as an opportunity to right-size: assess what each workload requires, eliminate technical debt that does not need to follow you to Azure, and build a governance model from day one that prevents new costs from accumulating.
That requires pattern recognition, understanding which workloads are candidates for direct migration, which should be modernized before moving, and which should simply be retired. This is where organizations without cloud migration experience most commonly make costly mistakes.
Sikich’s Azure Migration Framework applied to VMware environments
Sikich has executed Azure migrations across manufacturing, financial services, professional services, and distribution organizations, including environments with significant VMware footprints. As a premier Microsoft partner with all six Microsoft Solutions Partner designations, our approach is built around preventing the surprises that turn planned migrations into extended recovery operations.
For VMware-specific migrations, that means:
- Workload assessment: categorizing every VMware workload for migration, modernization, or retirement before a single VM moves
- AVS bridge strategy: using Azure VMware Solution as a landing zone for workloads that need time to modernize without business disruption
- Right-sizing for Azure: eliminating the stranded capacity built into on-premises VMware environments and sizing Azure resources against actual utilization
- Zero-downtime execution: phased migration with tested rollback procedures so your business keeps running through every stage
The cost of waiting is real and compounding
Every month your organization remains on Broadcom’s VMware licensing model is a month you are paying the new price structure for infrastructure you could be running more cost-effectively on Azure. The organizations that moved quickly after the acquisition are already realizing the benefit. The ones still evaluating are still paying.
If you are ready to understand what a VMware-to-Azure migration looks like for your specific environment, what it would cost, how long it would take, and what the path looks like, the Sikich Azure Assessment is the right starting point. It gives your team the visibility to make that decision with data rather than estimates.
Join us for our Azure Health Check Webinar
See how Sikich applies its migration framework to real Azure environments, including VMware workloads, and what the assessment process looks like in practice. The webinar takes place on August 27th at 11:00 am ET.
This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.
