Renewing Broadcom Contracts
Broadcom contract renewals are notoriously challenging. Customers often face steep cost increases (“uplifts”) and more restrictive terms at renewal time.
Unlike negotiating a brand-new deal, a renewal can feel like the vendor has the upper hand – Broadcom knows you’re already invested in their technology, which can reduce your leverage.
If you approach a renewal unprepared, you risk budget shock from unplanned price hikes or being locked into unfavorable multi-year commitments by default.
This guide provides procurement-focused strategies to turn the tables. Renewal negotiation isn’t just a formality – it’s an opportunity to push back against price increases, secure better terms, and realign the contract with your needs.
We’ll cover why starting early and auditing your usage is vital, how to counter Broadcom’s typical uplifts, ways to negotiate discounts even as an existing customer, and tactics to add flexibility to what Broadcom hopes will be a one-sided deal.
Whether you’re managing a legacy CA or Symantec contract or facing a VMware renewal under Broadcom’s umbrella, these best practices will help you approach the process strategically and avoid costly mistakes.
Start Early & Audit Current Usage
One of the biggest mistakes is waiting until the last minute to negotiate.
Begin your renewal planning 6–12 months before the contract expiration.
Broadcom’s sales teams are known to deliver renewal quotes late in the game, creating deadline pressure and hoping to corner customers into unfavorable terms.
By starting early, you keep control of the timeline. You have time to evaluate your options, build internal consensus, and go through multiple negotiation rounds – rather than scrambling as the expiration date nears.
Early engagement also signals to Broadcom that you won’t be forced into a rushed deal.
An early start should include a thorough audit of your current licenses and support usage. Inventory exactly what you have and how much you’re actually using.
It’s common to find shelfware – licenses or modules you pay for but don’t use.
If you discover, for example, that out of 100 licenses purchased, only 70 are actively used, plan to true-down to 70 at renewal.
In other words, remove or reduce the unused 30 from the contract.
This rightsizing ensures that you’re not paying maintenance on idle licenses and provides a concrete basis to push back on Broadcom’s pricing.
Come to the table with data: “We only need X licenses now, so our renewal costs should drop accordingly.”
If your current contract doesn’t allow for reducing quantities, negotiate to include a true-down clause in the new agreement (e.g., “Customer may reduce license counts at renewal with fees adjusted proportionally.”).
That way, as your needs change, you won’t be stuck overpaying for past usage.
Starting early also gives you time to align internally. Gather all stakeholders, IT, finance, procurement, and business unit leaders, well in advance, to define your priorities and fallback options.
If the renewal requires budget approval, having preliminary numbers and strategy 6+ months ahead avoids last-minute surprises for your CFO.
In short, don’t let Broadcom’s timeline control you. Proactively initiate the renewal process at least two quarters before expiration, so you’re negotiating on your terms, not under their deadline.
Assess Upcoming Uplifts
Broadcom’s initial renewal quotes often come with a shockingly high uplift.
It’s not unusual to see renewal fees jump by 20%, 50%, or even more if your current contract has no cap on increases.
Some customers have even reported that quotes have doubled or tripled their costs with little explanation.
To avoid surprises, review your existing contract for any clauses that may include price increases. Does it limit annual increases (for example, to 3-5% or tied to CPI inflation)?
If so, remind Broadcom of that term and insist any renewal offer honors that limit.
For instance, if your contract says fees can rise by CPI or 5%, whichever is lower, then an offer of a 20% hike is out of bounds – push back firmly by pointing to the contract.
If your agreement lacks such protections, assume Broadcom will propose a significant uplift by default (they might start at 7-10% or higher).
Don’t simply accept it. Counteract a steep increase with data and negotiation: Explain that your usage or business demand has decreased (using the results of your audit) or that the value delivered hasn’t grown to justify a higher price.
In other words, make them justify the increase.
You can also propose adding a price cap now as part of the renewal deal. For example, negotiate a clause that “renewal fees shall not increase by more than 3% per year or the CPI rate, whichever is lower.” Even if you have to accept some uplift, capping future ones will protect you going forward.
Also, scrutinize any changes in the quote. Broadcom may alter its licensing models or bundle services differently at renewal in a way that increases costs.
Always ask for a breakdown of why the price is what it is and what each line item covers. If something appears off (such as a new fee or an inflated metric), question it.
Remember, at renewal, the key bit of leverage you have is the option – however painful – not to renew or to consider alternatives. Broadcom knows this, so if the price is pushed too high, you might actually walk away.
Use that fact to argue for a fairer rate.
The bottom line: never accept a massive uplift without challenge.
Identify what’s driving it, use any contractual guardrails you have, and negotiate firmly to bring that increase down to a reasonable level.
Negotiate Renewal Discounts
Just because this is a renewal doesn’t mean you can’t get a discount.
In fact, you should treat a renewal negotiation much like a new purchase – make Broadcom earn your continued business.
Here are tactics to push for better pricing or terms even as an existing customer:
- Bundle and Expand: If you foresee needing more Broadcom products or a usage expansion, use that as a leverage point. Vendors often offer better pricing for larger deals. For example, consider negotiating multiple product renewals or an upsized license count all at once. A larger combined contract value can unlock volume discounts that wouldn’t be available with a single, smaller renewal. Broadcom will be more flexible on pricing if they see an opportunity to upsell and secure a larger portion of your spend.
- Co-term Multiple Renewals: If you have several Broadcom-related contracts (from different product lines or acquisitions), consider aligning them to renew at the same time. This consolidation means you’re putting a larger sum on the table in one negotiation. Broadcom will be keen to retain the entire package and may offer higher discount tiers to secure a multi-product commitment, rather than risk losing business pieces one by one.
- Use Competitive Quotes: Bring competition into the discussion to enhance the debate. Even if switching is unlikely, having a quote or proposal from a competitor gives you leverage in negotiations. Mention that you are evaluating alternative vendors or solutions (“We’re also looking at [Competitor]’s offering…”). The threat of losing your account to a rival can motivate Broadcom to sharpen its pencil on pricing or throw in extras. This is particularly relevant for something like a VMware renewal – let Broadcom know you’re considering other cloud or virtualization platforms if the deal isn’t right.
- Ask for Loyalty Perks: Don’t be shy about asking, “What can you do for us as a long-term customer?” This simple question can sometimes prompt an extra concession – like an additional discount or a free service upgrade – that wouldn’t be offered otherwise.
- Leverage Multi-Year Offers: Broadcom often prefers multi-year renewals. If you’re open to a longer term, make it work to your advantage. Only agree to a multi-year deal if it comes with tangible savings or locked-in rates to justify your commitment. For example, consider committing to a 3-year term only if they offer a significant discount compared to annual pricing and guarantee no unexpected increases during those years.
Overall, don’t shy away from negotiating just because it’s an existing contract. Broadcom’s initial renewal quote is often just a starting point.
By introducing additional value (bigger scope) or risk (the possibility of losing you to others), you create pressure for them to come back with a better offer.
The key is to demonstrate that you’re serious about getting value for your spend and that you’re not afraid to push back or consider alternative options.
Multi-Year vs. Annual Renewals
A major decision in renewal negotiations is whether to sign a multi-year agreement or stick with annual renewals. Broadcom will often push for a multi-year lock-in.
Here’s how to weigh the options:
Multi-Year – Pros: Longer commitments can provide price certainty. If you can lock in today’s pricing for 2-3 years (or negotiate minimal capped increases), you gain predictability for your IT budget. Broadcom might also offer an upfront discount or incentives for multi-year deals, as it secures your business for a longer period. In an environment where Broadcom’s prices tend to rise year over year, a multi-year contract can shield you from the highest future hikes for a while.
Multi-Year – Cons: The big drawback is reduced flexibility. When you commit to, say, a 3-year term, you’re usually stuck with those licenses and costs even if your needs change or if better alternatives emerge. You generally cannot reduce license counts mid-term unless you negotiated that rare clause. If your company might downsize or pivot to a new solution, a multi-year deal could have you paying for things you don’t use. Additionally, if you haven’t secured a price cap, you may still face built-in annual increases in a multi-year contract (e.g., 7% per year), which compound over time.
Annual Renewal – Pros and Cons: Opting for one-year-at-a-time renewals keeps your options open. You can adjust quantities or switch vendors sooner if needed, and you force Broadcom to “re-earn” your business each year. This can be valuable if technology or business needs are evolving quickly. The trade-off is that you might face an attempted price increase every year, and you’ll have to invest time in negotiations more frequently. Broadcom might also give less of a discount on a single-year term compared to a multi-year term, since they view it as less commitment from you.
How to Decide:
Consider your organization’s future and the deal on the table. Suppose Broadcom is offering a multi-year contract with strong benefits – like locked pricing or a substantial discount – and you’re confident you’ll need the product for that duration. In that case, it can be worth it for stability and savings.
Just be sure any multi-year contract includes clear limits on price increases and ideally some ability to adjust if usage drops (even if it’s at renewal anniversaries).
On the other hand, if your environment is in flux or Broadcom isn’t offering adequate concessions, you might prefer the flexibility of annual renewals. In that case, you keep more negotiating power year by year and can pivot sooner if needed.
In any scenario, don’t automatically accept a multi-year just because it’s presented. Treat it as a bargaining chip: if Broadcom wants the certainty of a long-term deal, what will you get in return?
And if you do go for multiple years, lock down the terms so you’re not signing away your rights or losing control of costs for the duration.
Leverage Timing and End-of-Quarter Pressure
When you negotiate, it can be as important as what you negotiate. Broadcom (like most vendors) has quarterly and annual sales targets, so the end of a quarter or fiscal year is when they’re often most eager to close deals. You can use this timing to your advantage.
If possible, align your negotiation milestones or final sign-off around Broadcom’s quarter-end. Sales reps may have bonuses or quotas to hit, which makes them more flexible as the deadline approaches.
For example, if your renewal is due in mid-quarter, you might slow-play the negotiations until the quarter’s end draws near, then push for that last bit of discount or an extra concession. The rep will be motivated to finalize the deal before the window closes, potentially giving you a better price if you commit by that date.
Conversely, be aware that Broadcom might try to use timing against you.
They might delay providing a quote or stall discussions in hopes of squeezing you as the expiration date nears, leaving you with little time. That’s why starting early is so crucial – it neutralizes this tactic.
If you find the timeline slipping, don’t hesitate to escalate to management and make it clear that you won’t sign a bad deal just because the clock has run out. In extreme cases, be prepared to let the support lapse or negotiate a short extension rather than agree under duress (though that’s a last resort).
In summary, try to negotiate during Broadcom’s high-pressure periods, not yours. Quarter-end urgency can work in your favor – vendors often offer better terms when they have a target to meet.
And always give yourself enough buffer so that if Broadcom drags their feet, you aren’t the one scrambling. The goal is for them to feel the deadline pressure, not you.
Early Renewal Negotiation
Another strategy to consider is negotiating a renewal well in advance of the contract expiration – essentially extending or renewing your agreement early. Broadcom may occasionally offer incentives to do this (since it pulls revenue in sooner and extends your commitment). Early renewal can benefit you in the right situation, but it needs to be approached carefully.
The advantage of an early renewal is that you might lock in current pricing or terms before they change. If you anticipate that next year’s renewal could bring a hefty increase or less favorable conditions (for example, after Broadcom acquires a company like VMware, prices might climb), negotiating a deal now could secure better rates for the next few years ahead of that curve.
You might also negotiate for some extras as part of an early deal – such as a modest discount for signing ahead of schedule or guarantees regarding product roadmaps and support.
However, don’t agree to an early renewal unless it clearly benefits you. Broadcom will gain by keeping you longer – so ensure you gain something too. Maybe you get a multi-year price freeze, or you avoid an impending price model change. If those advantages aren’t there, there’s little reason to sign on early.
Also, consider your future flexibility: extending now means you push your commitment out further, which could delay any plans to switch to alternatives or to drop unused licenses.
In short, use early renewals selectively.
If Broadcom presents a compelling offer that secures your interests (lower cost, favorable terms) and you are comfortable continuing with the product, it can be a win-win.
But if the market is evolving or you expect to have more leverage closer to the original renewal date, it may be better to wait.
As always, weigh the pros and cons, and negotiate an early renewal just as hard as you would a normal one – don’t rush just because it’s early.
Incorporate Alternatives in Renewal Talks
Broadcom relies on the fact that switching away is difficult, which can make customers feel they have no choice.
To improve your negotiating position, you need to show that you do have alternatives. Even if you’re likely to stay, introducing viable alternatives will keep Broadcom on its toes.
Two powerful sources of leverage are third-party support and competing products:
- Third-Party Support: Instead of renewing Broadcom’s support services at high cost, you could contract an independent support provider. Companies exist that specialize in supporting software from vendors like Broadcom (including legacy CA or Symantec products, and potentially even VMware environments), often at a significantly lower fee. Let Broadcom know you’re considering third-party support if their maintenance fees are too high. The idea that you might take your support dollars elsewhere puts pressure on them to be more competitive in terms of price. Even obtaining a quote from a third-party and subtly mentioning it (“We have an option to get support for 30% less from another firm…”) can strengthen your hand.
- Competitive Solutions: Evaluate other vendors or solutions that could replace Broadcom’s product. This might be a direct competitor’s software, or a different approach altogether (for example, moving to a cloud service instead of renewing a data center tool). If you’re, say, negotiating a VMware renewal under Broadcom, you might explore alternative virtualization platforms or increased use of cloud providers as a long-term strategy. You don’t have to fully commit to switching right now, but if Broadcom believes you have a realistic plan to migrate, they will be more inclined to consider your request. During talks, you can drop in references like, “We’re also piloting [Alternative Product] to see if it meets our needs.” That signals to Broadcom that they could lose the business, which can lead to a more accommodating stance from them.
The key is credibility.
Broadcom will recognize empty threats, so your alternatives must appear genuine. Do your homework: know roughly what effort or cost is involved in switching, get preliminary buy-in from your leadership on the idea that “if Broadcom doesn’t come to the table, we have Plan B.”
Even if you ultimately stick with Broadcom, demonstrating that you have other options changes the negotiation dynamic.
It reminds the vendor that you’re at the table by choice, not because you’re tied to them, which is exactly the mindset you want them to have when negotiating a renewal deal.
Renewal Negotiation Checklist
Before you sign any renewal agreement, run through this checklist to ensure everything is in order and in your favor:
- Remove Unneeded Licenses: Ensure that any licenses, modules, or services you no longer require are removed from the renewal. Don’t automatically renew the same quantity as before if your usage has dropped. If necessary, include a clause in the contract that confirms your right to reduce quantities at renewal (the “true-down” right). This prevents the need to pay for shelfware going forward.
- Verify All Pricing in Writing: Triple-check that the contract reflects the pricing you negotiated. Any discounts or special rates should be clearly stated. Do the math to confirm the totals match what you expect. If you negotiated a multi-year deal with specific annual fees, each year’s cost or the formula for increases should be spelled out. No handshake deals—if it’s not written in the contract, it doesn’t exist.
- Cap Future Increases: Ensure the renewal includes any agreed-upon price increase caps or inflation protections. For example, if Broadcom agrees to limit fee hikes to 3% per year, ensure a clause states exactly that. Without a written contract, you may find that your costs skyrocket in later years, despite verbal assurances.
- Avoid Unwanted Auto-Renewal: Check if the contract contains an auto-renewal provision. Ideally, you want renewal to be a conscious decision, not an automatic one. If the draft has auto-renewal language, negotiate it out or require an explicit written agreement to renew. This way, Broadcom can’t lock you in for an extra term without your approval. Also, note any notice period required to avoid auto-renewal (e.g., “60 days’ notice before term end”). Mark that date on your calendar so you don’t miss it and get stuck unintentionally.
- Watch for New Restrictions: Sometimes, renewal contracts include new terms. Look out for anything that reduces your flexibility or adds risk – such as stricter audit rights for Broadcom, limitations on your ability to outsource or use cloud resources, or bans on third-party support. If you spot any unfamiliar or one-sided clauses, question them and push back. You should not be losing rights in a renewal; if anything, you want to gain or maintain them.
- Documented Support and Deliverables: If your renewal includes support services or product upgrades, ensure the contract clearly defines the specific support and deliverables you’ll receive. For instance, if Broadcom promises to support a legacy product for two more years or to include a certain add-on product in the renewal, ensure that this promise is documented. Ambiguity can lead to disputes later, so every commitment should be clearly documented.
- Everything in Writing: Finally, ensure that every concession or change you negotiated is captured in the final contract version. If Broadcom’s representative promised something during the talks – a pricing adjustment, a service credit, or a specific flexibility – it must be reflected in the written agreement or an addendum. Compare your negotiation notes or term sheet side by side. Don’t assume “they’ll remember” later; people change roles and memories fade. Lock it all in writing now.
By methodically reviewing this checklist, you can sign the renewal with confidence. You’ll know that you’ve removed waste, nailed down the pricing, protected against nasty surprises, and that the contract reflects the deal you actually agreed on.
FAQs
Q: How far in advance should I start a Broadcom renewal negotiation?
A: Ideally, start around 9–12 months before your contract expires. For large, complex agreements, a full year provides ample time to audit usage, explore alternatives, and engage with Broadcom without rushing. In a pinch, begin at least six months in advance for smaller deals. The key is not to find yourself two weeks from expiration with no plan in place. Early preparation enables you to negotiate deliberately and effectively handle any delays or tactics Broadcom might use to compress your timeline.
Q: Broadcom is proposing a multi-year renewal – should I take it?
A: It depends on the terms and your situation. A multi-year contract can be worthwhile if it locks in pricing and offers a discount that you wouldn’t receive otherwise. If you know you’ll need the product for the next few years and Broadcom is offering, say, a significant price break or a cap on increases in exchange for a 3-year commitment, that could be a good deal. However, if a multi-year contract just means you’re locked in without financial benefit or flexibility, you might push back. You could counter that you’ll only consider a multi-year option if certain protections (such as price caps and the ability to adjust if your needs change) are included. Remember, a multi-year contract primarily benefits Broadcom by guaranteeing them revenue – ensure it clearly benefits you too. If not, there’s nothing wrong with opting for a one-year renewal and revisiting the market sooner.
Q: What if I do nothing and let my Broadcom contract auto-renew?
A: Letting it auto-renew without negotiation is usually a mistake. Auto-renewal means the contract will extend on Broadcom’s terms (often with a built-in price increase), and you miss the chance to make any changes. You’d likely end up paying more and be stuck with any unfavorable clauses for another cycle. Broadcom prefers customers to auto-renew because it keeps revenue flowing in without requiring them to negotiate or concede anything. If you simply forgot about the renewal, you might also miss the window to reduce licenses or switch options, and then be locked in for another year (or whatever the term is). In short, “doing nothing” hands all the advantage to the vendor. It’s far better to proactively engage, even if you think you’re generally fine with the product. You might discover you can negotiate a better price or terms. At the very least, you’ll confirm what you’re paying and ensure there are no nasty surprises. Always take control of the renewal process; don’t let it happen to you by default.
Related articles
- How to Negotiate Renewal Discounts with Broadcom
- Broadcom Renewal Price Increases and Buyer Tactics
- Early Renewal Negotiation with Broadcom – Pros, Cons, and Tactics
- Leveraging Alternatives in Broadcom Renewals – Third-Party Support and Competitive Options
- Broadcom Multi-Year vs Annual Renewals – Which Strategy Protects You Best?
5 Actionable Renewal Strategies
To conclude, here are five concrete steps to help you secure a better outcome on your Broadcom renewal:
- Start Early and Set the Timeline: Begin your renewal efforts 9–12 months in advance. By controlling the schedule, you avoid last-minute panic and won’t be forced into a corner by Broadcom’s delays or deadlines.
- Audit and Right-Size Your Usage: Know exactly what you have and what you use. Identify shelfware and plan to cut it. Entering negotiations with data on actual usage allows you to eliminate waste and resist overpaying.
- Enforce Price Protections: Don’t accept open-ended increases. Negotiate caps on annual price hikes (e.g., CPI or a small fixed percentage) and get those terms in the contract. Price predictability is key to your budget.
- Utilize Quarter-End Leverage: Align negotiations with Broadcom’s quarter-end or year-end, when possible. Their urgency to hit targets can translate into last-minute discounts or concessions for you.
- Get Everything in Writing: Whatever you negotiate – discounts, special terms, future flexibilities – ensure it’s documented in the signed contract. Don’t rely on verbal promises or assumptions. A well-documented agreement is your safety net.
Approaching your Broadcom renewal with this level of preparation and strategy can turn a daunting negotiation into an opportunity to save money and improve your terms.
Even if the vendor holds many cards, a savvy buyer with a plan can secure a much more favorable deal.
Read about our Broadcom Negotiation Service.
