VMware is not evil – my opinion on their new licensing model

What a WEEK!!!  VMware didn’t let us down with all the buildup they made to their big launch on Tuesday.  In the immortal words Chad Sakac – it was FACEMELTING AWESOMESAUCE.  I mentioned a few of my favorite things about vSphere 5 on this blog post.  The unfortunate side of the announcement was the reaction to VMware’s licensing change.   There seems to be a ton of questions/comments and a lot of snide remarks !!  Change is ALWAYS difficult but change is always inevitable.  Especially in IT !!  So here is my opinion on the change, and an idea as to why it was made. As my dad used to say, opinions are like….well you know…and everyone has one 🙂

If we think back a few years most organizations were looking at the benefits of virtualizing their application as a means to help cut down on all the capital expense associated to physical servers (servers, networking, power, cooling etc).   Back then it was all about driving more VM’s inside a physical server.  We learned early on that we always seem to run out of memory way before we ran out of other things like CPU and storage.  This deficiency of memory spurred companies like Cisco, Dell, HP, IBM etc to develop server platforms that could scale more memory on a physical server and geared these new offerings towards customers going down the virtualization path.  They would charge a premium for this feature by justifying to customers their ability to help drive VM density up, thus saving more money on not just server/networking ports but also on software licensing.  Server prices went up, but no one really cared because they were saving money on things like hypervisor licensing as well as all the benefits of reducing physical servers.

If we take VMware as an example, they are still developing a lot of great tools/features in their vSphere line but could potentially see a big reduction in the number of licenses sold because these server manufactures are driving memory and CPU density through the roof (Scale Up).  It was just a few years ago that the largest amount of memory you could get on a server was 64GB and today you can get well over 300GB on a blade.  There is also this big push towards a utility/consumption model.  While not everyone wants to go there right away, there are some organizations that need to re-evaluate how software vendors licenses their applications/OS’s.

In my opinion VMware is simply doing what they have to do to help drive revenue and continue their spectacular innovations.   I don’t think VMware is evil, nor do I think they are out to get their unfair share of money.  They are simply trying to adapt to the current way people are doing business.

I always like to use the analogy of Golf when describing changes and motivations.  Sometimes in golf you are presented with an opportunity to use the rules to your advantage.  In other words, you are presented two different ways to do something and we take that moment to figure out which ones works to our advantage and we typically move forward with that one.  That’s not different in IT.  We recognize that we can buy servers with tonz of memory, which we can use to help drive up our VM density thus cutting down on licenses and software maintenance so we do that.  I’m sure as we start to better understand this licensing model we will adapt our buying habits to reflect the best way to maximize the value of our purchases.  That might mean changing our architecture to fit this new model.

I would really really really encourage you to read these 2 things before you figure out how this will impact you.  The first one goes into a little detail behind the reason for the change, the other is a PowerCLI script you can run against your vCenter server that will produce a REALLY nice document that will give you an idea as to what sort of impact (good or bad) the move to the new license model will make.

Understanding the vSphere5 vRAM Licenseing Model

vSphere5 Licensing Entitlements (Power CLI Script)

Also, here are a couple of other noteable blog posts you should check out:

Do not hesitate to reach out to your VMware account team, or the company you purchase your VMware licenses from if you have any questions or concerns about your particular situation.

Like I said, this is just my opinion based on the years I’ve been in the industry.  On both sides of the table !!


13 thoughts on “VMware is not evil – my opinion on their new licensing model

  1. Great post. Looks like we share the same opinion – so there are others out there even if for now we are the minority. Remember the mass hysteria caused when VMware introduced the new license structure with 4 – Enterprise Plus, Enterprise, Advance, Essential, whatever, etc… (the knee jerk reaction there for many was also to proclaim “I am moving to Hyper-V”).

    I am guessing that most people are complaining about the fact that there is change and not necessarily the change itself. Once some of these folks take a minute to look at their environment they will probably find it is not going to be that bad.

    Again great post and I enjoy your articles.


  2. I think both of you are correct, as a consultant in this space I have talked to 6-8 customers in the past few days and analyzing the conversation most of the frustration is at the complexity of a change not the actual change. I even called that out with a couple of them and it was true, they were not frustrated at “what a vRAM is” but the fact that they are going 95 miles per hour toward a virtual milestone and now they have to stop and understand a new licensing model and how it affects them. The script linked worked great and really cleared up a lot of questions once we ran it and got into the details.


  3. Dude, I can agree to an extent but its still stinks either way. Right now the poll I stuck on my blog site has an interesting feedback. 121 votes and 40% say it will cost 100% more in licensing cost. That’s a pretty big set back either way you look at it.

    All in all VMware is still solid and more evolved then anything on the market. It needs to be a COMPLETE OVERVIEW of what your gonna end up spending. As always TCO, ROI, and etc, etc.


    Its cool to hear what others have replied said on the comments as well.

    1. First and foremost thank you very much for commenting !!! I think most people feel that way until they run Alan’s powerCLI script that you run against vCenter (http://www.virtu-al.net/2011/07/14/vsphere-5-license-entitlements/ ) and what i’ve heard is it’s not as bad as they thought. I’ve been encouraging customers to run that Script and post their results (Good/Bad or Indifferent) to VMware’s community site http://communities.vmware.com/message/1792147#1792147 – i think as much “real world results” that can be published to VMware’s site will help build the case to VMware that they need to either tweak the vRAM entitlements or throw this out all together.

      Make sense?

  4. Excellent post. I am in agreement with you. While I think the vRAM approach is the right way to go, I think vRAM enititlements can be revised to make most people happy. I posted on this similar issue on my blog today after seeing the unrest in the virtual world..


    Sadly the MBAs got more attention than the Engineers who brought vSphere 5 to life 😦

  5. Come one. It’s not bad at the current scenario for most people *yet*, but they are still ripping people off, not allowing them to grow the same hardware without having to pay more. What about the people that have already purchased hardware like DL380G7 and 192GB or 384GB of memory. It is bad , very bad what they are doing. They are taking a chance on customers and thinking they will stay anyway, but in this case they are playing with a very sensitive area, their wallets. I think VMware has done a great job in the past years in terms of pionerring on new features for virtualization but that don’t justify them to put the price up. We pay Support and Subscription(SnS) for that; for them go, research and bring these new features. I am very disappointed with them and also with the fact this is encoraging people to go and have a look on other technologies like KVM and Xen (don’t think Hyper-V can be compared really) and they will find (for the first two) that they can do the job well with much lower cost if you consolidate things under less number of servers.
    VMWare is concentrating solely on their shareholders at the expense of their customers.
    A shame day on VMware history. The day they broke the trust with their customers.

    1. Thank you very much for your comments !!

      So i really believe that VMware is not evil or trying to rip people off and want to do the right thing. They have never done anything in the past to make me feel differently. I do think that they need to reconsider the entitlement ranges for the products. I thnk they need to balance that against the growing trend of people wanting to further reduce their physical servers down to 2 with a TON of cores and RAM so clearly a different licensing model needed to be looked at.

      What i’ve heard the most, and what I agree with is I would like to see Enterprise Plus go to 96GB per Socket (up from 48GB and Enterprise move to 48, Standard to 32GB, Essentials 32GB and their Free version up to 16GB) and would like to see GB Entitlement bumps that don’t require additional sockets. I was talking to someone the other day about this and they brought up that this new licensing model could actually help drive down the cost of DR since LInked Mode VC server will help add to the vRAM Pool. Most of the time those servers are either not powered on, or not utilized as much so they can help add to the entitlements.

      My guess is if enough people post their “real world/PowerCLI Generated” results on their community forums site or shared with their VMware account teams and it’s clear that it needs to change they will.

      Thanks again for your comment !!

  6. I disagree that vRAM is a good metric for licensing. A good metric was CPU/sockets. An acceptable change in licenses would be to do it by physical cores in a pool.

    Licensing by vRAM takes away the advantages of memory over-commit, compression etc and makes running mostly idle servers for DEV/UAT environments way too expensive. This would have been no problem if licensed by physical cores.

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