The VMware Tax: Topgolf's $11.3 Million Exit Signal

In the world of enterprise software, there is a tipping point where the cost of maintaining a legacy stack outweighs the risk of a total migration. For Topgolf, that point arrived with Broadcom's takeover of VMware.

As Ars Technica first reported, the sports entertainment giant has saved over $11.3 million by abandoning its long-standing relationship with VMware. The move was triggered by a projected 400 percent increase in costs under Broadcom's new pricing model, which includes the elimination of perpetual licenses and the bundling of products into more expensive SKUs.

**The Cost of the Migration**

Topgolf's integration with VMware was extensive. Scott Forehand, Topgolf's global infrastructure manager, told Ars Technica that the connection "ran very deep," noting the company had utilized vSphere and ESXi for decades and adopted the VxRail hyperconverged infrastructure (HCI) platform in 2017.

To escape the looming price hikes, Topgolf migrated 12,000 virtual machines (VMs) to VergeIO's VergeOS. The financial impact was stark: software costs dropped by 77 percent. Additionally, Topgolf replaced 650 VxRail hosts with approximately 400 Dell PowerEdge servers over a six-month period. Forehand noted that moving to Dell PowerEdge initially reduced comparative hardware spend by 87 percent, though he acknowledged that recent market shifts in compute and storage costs have impacted those original figures.

**Operational Gains and 'Weird' Needs**

Beyond the balance sheet, the migration solved scaling headaches. Forehand explained to Ars Technica that VMware lacked the ability to segregate clusters into tenants, which created management difficulties at scale. By utilizing VergeOS's Virtual Data Center offering, Topgolf can now segregate deployments by time zone and build nested labs within a single cluster, reducing the need for lab hardware.

The migration also allowed Topgolf to support its proprietary Toptracer technology, which handles roughly 40TB of network data per day in a typical 102-bay venue. Forehand stated that VergeIO helped resolve latency and pathing issues to better distribute this heavy traffic across cluster nodes.

**A Broader Industry Trend**

Topgolf is not an isolated case. George Crump, Chief Marketing Officer at VergeIO, told Ars Technica that the company gains about 70 new customers per quarter, most of whom are migrating away from VMware. Crump noted that these customers are typically facing renewals, hardware refreshes, or require multi-tenancy.

While Topgolf's specific savings are significant due to the scale of its operations, Crump suggests that reductions in software licensing and the avoidance of proprietary HCI appliances are common for those moving to VergeOS.

Topgolf is expected to be entirely off VMware by the second week of December. The company has secured a five-year enterprise license agreement (ELA) with VergeIO, a notable increase over the three-year ELA reportedly offered by VMware.