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Comment by mysterydip | Hacker News Reader

"to speed up its expansion into the enterprise software business."

Why does a chipmaker want/need to expand into enterprise software? Shouldn't they be expanding to making different chips?

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In 2021 Broadcom semiconductor revenue was $18.8B out of $27.5 billion. Broadcom has a large portfolio of enterprise software offerings.

The web page for their software offerings is at https://software.broadcom.com/ . The interesting thing you'll notice is that they do not list any specific software they offer (e.g. Symantec for enterprise security, which by the way is separate from Norton now). Rather they sell you on their ability to deliver on four specific enterprise functional needs.

They won't answer your call to buy their suite unless you're in the Fortune 500. They will try to sell you on their whole suite. They will upsell you on any new acquisition, eg VMWare.

They might renew my personal VMWare Fusion license for another year but would probably close that down soon for not being core. On the M1 I've moved on anyway to UTM.

EDIT: word choice

https://github.com/utmapp/UTM

The cool thing about UTM is that it runs hardware virt and emulation, so you can run x86 on M1, which Vmware Fusion cannot do.

x86 on M1 through Qemu is very slow though. Not really usable to run Windows 10 in good conditions, for example (good news is that this is rarely needed, Windows on Arm running x86 and x64 programs seems quite good)

Broadcom likes to buy big companies with big moats that trade at a reasonable multiple because they have a mature growth profile. There are no more chip companies left with that profile except Qualcomm, which they tried to buy, and maybe Intel although their moat is fading. So they pivoted to software.

IIRC Broadcom was sold to an equities group some years ago, so it's not really broadcom the chip manufacturer...but rather an investment company for tech

Pairing virtualization software tech with hardware chipsets that directly support it seems like a good plan.

I think this is the play. They can create or influence standards that favor their new position - build vertical integration where others in this space cannot.

Absolutely not.

You’re thinking that Broadcom acts as a company with a technological vision. This is a totally not the case and the CEO is very open about that.

Today’s Broadcom is a company that optimizes the financial performance of technology assets.

There are no long term plans.

Wouldn't that be an abuse of monopoly though? If VMware suddenly starts supporting broadcom hardware better than other enterprise hardware.

You could call it that. But it's also industry practice.

Why not both? There's no reason NOT to get into enterprise software. You have hundreds of sales people selling chipsets to enterprise and you're telling me it would be dumb not to have them increase their attach rate?

Tens of thousands of sales people.

Because they want something that’s not affected by the chip shortage.

No, that is just incorrect. Please don’t speculate if you don’t know what you’re talking about.

This was reported by multiple financial news organizations, what makes you so confident it isn't true?

I am very confident this is not true. I am certain I know Broadcom’s corporate strategy and views on the semi cycle better than any financial journalist.

I think you misunderstand the point of HN, that is basically the only thing that occurs here.

I know, but if someone just flat out makes something up I’d hope they’d hedge their language a little bit.

Because corporate capitalism and investors expect ever higher returns. So a company that does good at what it does needs to look at new revenue sources to please investors which after a while just does mediocre at everything.

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