Full narration of the briefing. Click a section heading to jump the player to that moment.
The VMware deal is mostly a paper negotiation. The mainframe deal is a measurement negotiation, and that difference changes almost everything about how you prepare. On VMware, a bad clause costs you at the next renewal. On the mainframe, a bad baseline costs you every year until somebody notices, and quite often nobody does.
I am Tom, Claire is with me on the mechanics again, and this is the episode where the preparation we described in part three turns into specific asks.
Start with the baseline, because under consumption licensing it is the whole game. Your baseline is negotiated from three to twelve months of your own capacity reports. So the reporting window is not an administrative step, it is the negotiation, happening before anyone discusses price. Which means two things.
Choose the window deliberately rather than accepting whichever months are offered, because a window containing your year end peak sets a floor you then pay against forever. And decommission anything you are not using before that window opens, not after, because once a peak is measured it is a fact and you have no argument left.
Second ask, and it is the one that saves the most money over a five year horizon. Settle your capacity terms before the hardware is ordered. Remember the mechanic from part three: CA's own filing says licences run up to a specified capacity in MIPS, and additional capacity during the term costs an additional fee. And IBM's own disclosure on the current generation puts about one billion dollars of extra hardware against more than three billion of extra software.
So the software consequence is roughly three times the hardware decision. Once that box is installed, your capacity number is a fact, and every vendor prices against it.
Third, and it will be refused at least once. Ask for line item pricing at product level. The default is a single portfolio number, and that single number is doing a great deal of work for the vendor. If you cannot see what any individual product costs, you cannot calculate what dropping one would save, which means your threat to remove a product has no arithmetic behind it at all.
It becomes an opinion. So ask for the breakdown, in writing, early, and if it is refused, ask for the refusal in writing too. That refusal is itself useful, because it tells your board precisely why the estate cannot be optimised.
Fourth, cap the next term. There is no renewal price protection in this model whatsoever, so whatever you negotiate now governs this term only and the following one starts from wherever they choose. Your reference point is the number Broadcom itself publishes: an annual worldwide pricing notice, running three, four, five, five, six, and six percent for 2026. Roughly a third compounded since 2021.
That is the floor, and it is a reasonable place to anchor a cap. Ask for the increase to be bounded to the published list movement, or to a fixed percentage, and treat the absence of any cap as the risk it actually is.
Fifth, and this is the one almost nobody does. Broadcom, IBM and BMC all price against the same capacity number. One unmanaged peak in your environment ratchets three separate invoices at once, from three vendors who never have to coordinate to benefit from it. So sequence the renewals deliberately rather than letting them fall where the contracts happen to land.
Do not let all three fall in the same window, because you cannot run three negotiations properly at once. And do not let any of them fall immediately after a hardware upgrade, because that is the moment your measured capacity is at its highest and your leverage at its lowest.
So what does a good mainframe outcome look like. Not primarily a discount. It looks like line item visibility you did not have before, a cap on the next term where there was none, a cure period on the reporting obligations, and a capacity position you chose rather than one that was measured for you. Those four things compound in your favour for years, which a one off discount does not.
Next time is the capstone, where Claire, Daniel and I put both halves of the estate onto one timeline and run it as a single campaign, because that is how this is actually won.
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