AT&T and Broadcom have 30 days to figure out their VMware support contracts before a New York judge makes a decision on AT&T’s request for injunctive relief. Justice Jennifer Schecter told both parties to update the court by November 22, 2024, about their negotiations. Until then, Broadcom must keep providing VMware support services to AT&T, as they agreed before.
During a hearing on October 23, Schecter made it clear that she wouldn’t grant any indefinite relief just to let the clock run out. AT&T is fighting back, arguing that its contract with VMware, finalized before Broadcom took over, includes a two-year extension for support services that Broadcom refuses to honor.
Broadcom argues that the services AT&T wants no longer exist since they’ve changed VMware’s offerings and shifted to a software subscription model. They also claim that AT&T’s calculations of damages are incorrect.
In an October 11 court filing, both companies mentioned they were making headway in their discussions, but reports say those talks fell apart last week. The conflict AT&T faces mirrors struggles other VMware customers deal with. Marc Staimer, a consultant, noted that while a victory for AT&T might embolden larger companies to negotiate, most lack the resources for long legal battles.
Broadcom’s lawyers claim AT&T is trying to “rewind the clock” to access VMware products that were available before the acquisition. During the hearing, Broadcom’s Alison Plessman argued that AT&T is overstating the risks to its software environment if they lose support. She pointed out that AT&T hasn’t provided an audit of the specific VMware software it uses, and after the acquisition, some products might not even be supported anymore.
Schecter questioned Broadcom’s capability to provide support, asking if their employees were unable to help with software AT&T purchased. AT&T’s Jonathan Pressment responded that they aren’t planning to stay with Broadcom’s VMware offerings and are looking to transition to different software but didn’t detail a timeline.
He mentioned that the legal route was necessary to compel Broadcom to negotiate, especially since Broadcom threatened steep price hikes ranging from $3 million to $9 million annually. “Without the threat, there’s really no way Broadcom will become more reasonable,” he stated, emphasizing they want the same support services to continue.