I still don't get this from a strategy point of view. Let's say you have 100 "whales" who generate half your revenue and another 100,000 "minnows" who generate the other half. That's still half your revenue. As long as you are making a profit on the minnows, even if small, surely you'd want to keep them? I assume they must be profitable because otherwise third parties wouldn't be trying to poach them, to extend the fishing analogy a bit further.
(That's not counting the huge negative reputational effect that this change is having on VMware which is surely worth something.)
(That's not counting the huge negative reputational effect that this change is having on VMware which is surely worth something.)