VMware Licensing Changes: Core Minimum Rises To 72
Is your business prepared for the seismic shift in VMware's licensing landscape? Broadcom's reshaping of VMware licensing, with minimum core purchases skyrocketing, will significantly impact how organizations budget and manage their virtual infrastructure.
Starting April 10, 2025, the ground rules for VMware licensing are changing dramatically. The minimum core purchase leaps from a modest 16 cores to a substantial 72 cores. This seemingly small alteration carries significant financial ramifications, especially for small and medium-sized businesses. This change follows the acquisition of VMware by Broadcom, a move that has already spurred speculation about potential licensing adjustments. The shift to a higher minimum core purchase reflects a broader industry trend towards subscription-based models, mirroring changes seen with other software vendors. While VMware hasn't explicitly confirmed the reasons behind this specific change, the increased minimum purchase could be part of a strategy to incentivize larger deployments and streamline licensing management. The impact on businesses is undeniable. Organizations will need to meticulously reassess their current core usage and project future needs to avoid unexpected cost increases. Those operating near the previous 16-core minimum will face the most significant adjustments.
| Company | VMware, Inc. (a subsidiary of Broadcom Inc.) |
| Founded | 1998 |
| Headquarters | Palo Alto, California, USA |
| Key People | Raghu Raghuram (CEO) |
| Industry | Computer Software, Cloud Computing, Virtualization |
| Products | vSphere, vSAN, NSX, vRealize Suite, VMware Cloud Foundation |
| Website | https://www.vmware.com |
Previously, licenses were sold in increments of 16 cores per CPU, with a single license covering up to 32 cores. For CPUs exceeding 32 cores, additional licenses were required for the surplus. The new 72-core minimum significantly alters this structure. This change makes it more challenging for smaller deployments to acquire licenses cost-effectively. While the per-core pricing remains unchanged, the increased minimum purchase effectively raises the entry point for using VMware products.
The ramifications extend beyond the immediate financial impact. Organizations now face complex decisions regarding their virtualization strategy. The previous flexibility afforded by smaller license increments allowed for more granular scaling of resources. With the 72-core minimum, businesses may find themselves paying for more cores than they immediately require, particularly in smaller deployments or during periods of limited growth. This situation necessitates careful planning and resource allocation to optimize licensing costs.
VMware offers three editions of its flagship vSphere product: Standard, Enterprise Plus, and Foundation. Each edition offers varying features and capabilities, catering to different business needs. Previously, VMware allowed perpetual licenses for vSphere. These provided permanent access to the software version purchased. However, thats no longer the case. The transition to a subscription model means ongoing costs, but it also ensures access to the latest updates and support. Businesses must evaluate the total cost of ownership, considering factors like upgrade frequency and support requirements.
Adding to the complexity, VMware also offers two distinct license types: subscription and perpetual. The latter necessitates a permanent internet connection, posing a significant consideration for businesses operating in environments with limited or unreliable connectivity. The shift towards subscriptions has further complicated the licensing landscape. Customers now face choices between one, three, and five-year contract terms. Each option presents trade-offs between upfront costs and long-term commitment. It remains to be seen whether VMware will provide any incentives or discounts to encourage longer-term subscriptions.
The licensing changes also impact the vSAN storage virtualization platform. With VMware Cloud Foundation (VCF), each core license grants 1 tebibyte (TiB) of vSAN capacity. For VMware vSphere Foundation (VVF), each core license provides 100 gibibytes (GiB) of vSAN capacity. These changes, combined with the higher minimum core purchase, affect storage planning and capacity management. Organizations will need to revisit their storage requirements and factor in the new licensing constraints.
Furthermore, VMware is segmenting its customer base into three groups. While the specific criteria for these groups remain unclear, this segmentation suggests a potential shift in how VMware tailors its licensing and support offerings to different customer sizes and needs. This segmentation could lead to more tailored pricing models and support offerings for different customer segments. It remains to be seen whether this will result in more equitable pricing or further complicate the licensing landscape.
Broadcoms impact on VMware's licensing is substantial. These changes demand careful consideration from businesses utilizing VMware products. The implications extend to budgetary planning, resource allocation, and long-term virtualization strategies. Staying informed and adapting to these changes is critical for optimizing IT spending and maintaining compliance.
