IBM offloads 'hundreds' of its cloudy VMware customers

IBM has sold “hundreds” of its cloudy VMware customers to Broadcom partner 11:11 Systems.

Under Broadcom’s ownership, VMware slashed the number of cloudy partners it keeps on the books and retained only partners that go all-in on the Cloud Foundation (VCF) private cloud stack.

Partners that Broadcom decided not to work with lost the right to resell its software as of October 2025 and may not run VMware-powered clouds after March 2027.

IBM was once a top VMware partner, but last year stopped selling new cloudy VMware services, suggesting it wasn’t invited to continue as a Broadcom partner.

Sources tell The Register that soon-to-be-former VMware partners often have a contractual obligation to provide a Virtzilla-powered cloud beyond the March 2027 cutoff, and that their customers want whatever happens next to be non-disruptive.

One option for partners leaving the VMware fold is to turn to a wholesaler like 11:11, which runs its own VMware cloud.

Another option for departing partners is selling contracts for ongoing VMware cloud services to one of the remaining Broadcom partners.

11:11 Systems told The Register IBM sold contracts for “hundreds” of customers who use VCF in the Big Blue cloud.

11:11 CEO Brett Diamond said the contracts are for customers running versions 7 and 8 of VCF and who are therefore “ripe for migration.” IBM did not respond to our questions about the transaction, which included a request for information regarding some customers that we understand are not making the move to 11:11.

Diamond said 11:11 has 40 to 50 points of presence for its VMware cloud, and a migration methodology it will apply to the customers it bought from Big Blue.

He’s confident his newly acquired customers will want to stick around.

“The customers we manage are very large multinationals and Fortune 5000s who want to stay on VMware,” he said.

“No other hypervisor can handle the mid-to-large enterprise.” The CEO hopes to shift his new customers to VCF 9, a necessity given VMware ends support for VCF 8 next year.

11:11 also uses its VMware cloud to sell other services, by delivering it through a custom console that integrates around 50 other tools spanning backup, storage, and security.