VMware vSphere 4 licensing shows contempt for customers

July 31, 2009 · 1 comment

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By now you have read that VMware has released vSphere 4 with new capabilities and features.  But did you know that they changed their licensing model?  There are lots of changes to accept and for a lot of us, the cost just went up a notch.  Surprise!  At no time did VMware notify their users of the proposed changes and it seems they simply do not care about customer retention or loyalty.  They were already the most expensive virtualization offering on the market and now they jacked the price on all of us.  Your current support contracts are not enough to cover the costs — they want more.

First off, they changed the basic licensing which they say “simplifies” management.  In reality, it just adds costs to every data center manager trying to get the most from their budgets.  Rather than a license that can be used for up to two processors, that is being split into 2 single licenses.  So, you actually have more licenses to manage.  How did that simplify the data center manager’s life?  It may simplify how VMware counts licenses and drives revenue, but it did nothing for the customer except add more overhead.

Second, the “simplification” also states that a host will be assigned an entire “bundle” rather than separate licenses for each feature.  Again, this might help VMware, but it is in direct contrast to the first argument of splitting the processors.  In this scenario, I cannot move DRS, VMotion or HA licenses around my systems.  I have to move the entire bundle which complicates the process and removes a significant amount of flexibility in managing environments.  Overall, to use these features throughout the data center, you will have to purchase more licenses.  Good for VMware — not for you.

Third, the VMotion, HA, DRS and DPS are only available as part of the new vSphere editions and not separate purchases.  Now, you have to upgrade your editions to get these features.  How in the heck is this in my best interest?  Making me buy an edition or edition upgrades to get the features I need, but raising the cost because it contains items I don’t want.

If you are like me, then you probably have an Enterprise license to use ESX with HA, VMotion and DRS.  What happens now?  Well, you will be automatically transitioned to vSphere Enterprise.  However, this version will be end-of-life as of December 2009.  What a short life span for this product — to be obsolete within six months of its production release.  This is VMware pulling a real bait-and-switch with its customers and leaving a really sour taste in their mouths.  So, while your Enterprise licenses will continue to function, you will not be able to purchase this version after December.  We all know we are not going to give up DRS/DPM and the new Storage VMotion, so the only answer will be that we are forced to purchase Enterprise Plus which lists for $620 more.  But is that real?  No way.  Single socket servers are things of the past.  We all have multi-socket systems with multiple cores.  Remember, VMware changed the license from 1-2 processors per license to a single processor per license.  So the cost of a dual socket system has gone from $5300 on VI3 Enterprise to $6990 on Enterprise Plus.  That is a whopping $1690 price increase (32% jump) on a single dual-processor box.  That is just the software, but you still need support.  That has jumped from $1220 to $1750 for an additional $530 for our dual-processor box. 

So, what happens to the Enterprise license?  Our friends at VMware have a solution.  Either downgrade your Enterprise license to Advanced and lose those critical features that you have been paying for or upgrade to Enterprise Plus and get three features (vNetwork Distributed Switch, Host Profiles and 3rd Party Multipathing) you probably don’t need or want.  Until December, VMware is offering an upgrade promotion which allows an upgrade from Enterprise to Enterprise Plus for $295 per socket.  Sounds good, until you learn that you must also purchase an additional year of service and support.  So if you just paid for your VI3 renewal, then you are going to miss the promotion period and have to spend $1029 per socket.

These types of surprises are never good for a vendor to spring on their customers.  It is downright dishonest and flagrant abuse of their current install base which has made them what they are today.  When users purchase support agreements and software they fully expect that the vendors will give them continued software and availability on the platform.  If there are additions, it should be a part of what they have been paying for.  With this change VMware is affecting the level of trust with their customers.  This behavior is just unacceptable and I can hear my Dad saying, “a fool and his money are soon parted”  and it looks like VMware is making us all look like fools.

Article by Steve Van Domelen

Steve has written 47 awesome articles.

  • Paul Cruiser

    Amen, Steve. I’m only replying so late because my org has finally had it with VMware’s licensing tactics. My organization is on the brink of putting our VMware farm out to pasture, in favor of the underdog (maybe not for long), Microsoft Hyper-V.

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