A £100M Lawsuit: Tesco Sues Broadcom Over VMware License Dispute

Tesco has filed a lawsuit against Broadcom and its distributor Computacenter, alleging breach of licensing agreements and seeking up to £100 million in damages, according to The Register. The claim centres on Tesco’s January 2021 purchase of perpetual licenses for VMware vSphere Foundation and VMware Cloud Foundation, with support and upgrades valid until 2026 and an option to extend to 2030.

Tesco asserts that Broadcom’s acquisition of VMware led to the withdrawal of support for perpetual licenses and a shift to a subscription-based model, forcing the retailer to pay substantially more for software it already licensed. Within Tesco’s infrastructure, VMware software underpins roughly 40,000 servers supporting store checkout systems and other critical operations, making service disruptions a real concern if updates are no longer available under the perpetual arrangement.

The retailer argues that switching to alternative platforms would be costly and risky, and therefore is pursuing legal action to compel Broadcom to honour the original perpetual license and continue providing updates.