AT&T and Broadcom are nearing a settlement in their legal battle over VMware support services, signaling a potential resolution after months of tension. The dispute centers around Broadcom’s decision to bundle support with its VMware Cloud Foundation (VCF) subscriptions, a shift that AT&T claims significantly inflated its costs.

A recent letter, revealed by the New York Supreme Court, confirms that both companies have made enough progress in their settlement talks to warrant delaying the oral arguments originally set for October 15. Broadcom has agreed to extend support for VMware software until at least October 22 as negotiations continue.

The core of the dispute began when AT&T, under a perpetual license, expected an additional two years of support for its VMware software. However, Broadcom, after acquiring VMware, stopped offering standalone support services, opting to bundle them into pricier VCF subscriptions. AT&T argued that Broadcom had breached its contract and accused the tech giant of pressuring it into buying Cloud Foundation, which AT&T claimed came at a staggering 1,050% cost increase compared to its previous bills.

Broadcom pushed back, stating that AT&T’s virtual infrastructure was outdated and that the new offering, while more expensive, brought greater value by modernizing AT&T’s operations.

In fact, Broadcom highlighted that its discounted offer for a five-year VCF subscription was more favorable than market rates, though still pricier than AT&T’s previous arrangement.

This legal wrangling serves as a cautionary tale for other VMware customers facing similar transitions. Broadcom’s push towards subscription-based services reflects a broader industry trend, raising questions about future pricing models for enterprises heavily invested in legacy software.

As settlement discussions continue, AT&T and Broadcom’s resolution may set the tone for how businesses and tech giants handle support and subscription transitions in the evolving software landscape.