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VMware vSphere 5 Licensing and Pricing Update

As you are probably aware, when VMware announced our new Cloud Infrastructure Suite, we also introduced changes to the vSphere licensing based on a consumption and value-based model rather than on physical components and capacity. 

While we believe this model is the right long-term strategy as we move into the cloud-computing era, the announcement generated a great deal of passionate feedback from partners and customers that led us to examine the impact of the new licensing model on every possible use case and scenario – and equally importantly, taking into consideration our partners’ and customers’ desire to broadly standardize on VMware. We’ve listened to your ideas and advice, and we are taking action with the following three updates to the vSphere 5 licensing model:

  • We’ve increased vRAM entitlements for all vSphere editions, including the doubling of the entitlements for vSphere Enterprise and Enterprise Plus. Below is a comparison of the previously announced and the new vSphere 5 vRAM entitlements per vSphere edition:


  • We’ve capped the amount of vRAM we count in any given VM, so that no VM, not even the “monster” 1TB vRAM VM, would cost more than one vSphere Enterprise Plus license. This change also aligns with our goal to make vSphere 5 the best platform for running Tier 1 applications.
  • We’ve adjusted our model to be much more flexible around transient workloads, and short-term spikes that are typical in test & development environments for example. We will now calculate a 12-month average of consumed vRAM to rather than tracking the high water mark of vRAM.

Finally, we introduced the vSphere Desktop Edition to address vSphere licensing in a desktop environment. vSphere Desktop is licensed on the total number of Powered On Desktop Virtual Machines allowing  customers to purchase vSphere for VDI use case on per user basis.  Our price books are being updated and will be available on Partner Central shortly. 

If you have additional feedback please we welcome your comments here. We also have several resources on Partner Central available to provide clarity for you and your customers, a vmLIVE session available for replay, and an additional vmLIVE scheduled for August 10th 

We value our partnership with you and look forward to a successful introduction of vSphere 5 into the marketplace this quarter!

— Scott Aronson
Senior Vice President of Global Channels and Alliances.

79 thoughts on “VMware vSphere 5 Licensing and Pricing Update

  1. Gary H

    Can you please explain why Enterprise is now more expensive than Enterprise Plus, $44.92/GB vs $36.40/GB?
    While Standard is still less expensive than Enterprise Plus, $2985/96GB vs $3495/96GB, The difference in features doesn’t seem to fit well with the price difference.
    I can’t understand how VMware came up with the vRAM entitlements when looking at this from a cost vs features viewpoint.

  2. Mchael willams

    The licenses are very bad. Already have many customers that stated they will try alternatives. With the changes, they need to again be doubled as it is way too costly to run systems with 256 gb ram.

  3. Bigi

    Thanks vmware for listening to your customers. Great work everyone for sounding your comments on this board/phone/email.
    Although its not the best case scenario. vmware still has to make $$$$$ and hire best people etc.
    vSphere 5 here we come…..

  4. rjb2

    This was a very good move. We can now look forward to moving forward with vSphere 5.
    Thank you VMWare for doing the right thing!

  5. Unhappy Customer

    Somehow I should be happy that they relented and now I will only have to buy 2x as many licenses as I did before rather than 4x under the original proposal?

  6. Collin C. MacMillan

    Brilliant! Now Enterprise Plus accommodates every modern platform fully populated with 8GB sticks without doubling-up on licenses. Even memory oversubscription (i.e. 1TB VM, etc.) is reasonable. It would take more than 7x 16GB DIMMS per socket to exceed Enterprise Plus licensing at 80% memory utilization… Even the top-dog VMmark performers – 8 CPU, 160 thread monsters – cost the same (in licenses) under vSphere 5 as vSphere 4.
    Thanks, VMware, for listening and taking action on what you heard! Now we can start talking about the new features instead of licensing questions…

  7. Alberto de_la_Torre

    This new vRam stuff is really stupid. If a customer wants to buy more ram, there shouldn’t be an artificial constraint which causes them to pay more to use the exact same software. My customers currently exceed the vRam requirements across the board. Every single one of them would have to buy more licenses just to use what they are using today with vsphere 4.x.
    Time to pilot hyper-v

  8. Yet another dissapointed customer

    The price model still simply doesn’t work for hosting companies. Everyone that I know of in the industry is planning to move away from VMWare including our own company. We might still offer VMWare solutions for the minority of clients that wants to pay double for the few enterprise features that separates VMWare from other hypervisors. 🙁

  9. David C

    Tne new vRAM entitlement for Essentials, Essentials+ and Standard is not aligned with Intel’s 5500 and 5600 Processor RAM memory balancing best practices (applies to 1U and 2U socket servers mostly). According to Intel, RAM should be installed in sets of three PER processor. 24GB RAM is a valid option (6x 4GB RAM) , 32GB is not. It should have been increased to 36GB RAM (6x 4GB dimms + 6x 2GB dimms). By limiting server configurations to meet VMWare license limitation, many hardware business partners will probably configure servers improperly affecting performance.
    This affects IBM, HP, Dell and other vendors, given the fact that most of them are VMWare partners too and sell Intel based servers, How come VMware didn’t take this into account?

  10. Terry

    If the maximum is 96 GB how can you have a 1TB vRAM VM on 1 license ?
    As outlined above •We’ve capped the amount of vRAM we count in any given VM, so that no VM, not even the “monster” 1TB vRAM VM, would cost more than one vSphere Enterprise Plus license.

  11. Alberto de_la_Torre

    Stupid, Stupid, Stupid.
    You guys better eliminate this stupid vRam policy before all your customer go to hyper-v.
    It’s not up to you to decide how much ram a customer decides he want to buy/use.
    However you slice it, you are interfering in the a most negative way with your customers.

  12. Eric

    Overall I applaud your changes and thank you for listening to your customers. However, how does VMware plan to keep up with Moore’s Law? Will the lifecycle of vSphere 5 outpace Moore’s Law, or will it be the other way around? Some might argue that even a 96GB vRAM entitlement per CPU is not nearly enough given what’s available from all major server manufacturers today.

  13. KC

    Kudos to VMware for listening to the market! There’s a reason VMware is the market leader – and it’s not only because of superior products. Looking forward to selling vSphere along with the cloud infratructure products on the merits of new features.

  14. Bad Dos

    “While we believe this model is the right long-term strategy as we move into the cloud-computing era”
    Are you kidding? Hasn’t vsphere always been “cloud computing”? The fact still remains that you went from being the most expsensive option to even more expensive.
    How do you address the fact that the more tier1 applications you run on vsphere 5, the higher the tco compared to your competitors?

  15. Vidar

    Not good enough.
    Example: I have vSphere 4.1 Advanced Acceleration Kit which is good for 3 hosts with 2 cpus and 256GB RAM each. I paid 10495 USD for it. I might have paid 3 years upfront of SnS expecting to get upgraded to vSphere 5 at no cost like the vSphere 5 licensing docs actually states as well should be possible for customers with SnS. Can VMware please explain to me how I can upgrade at no cost with the above setup to vSphere 5 assuming I’m already oversubscribing RAM?

  16. Steve

    I still think the vSphere 5 memory entitlements are far too low and having to purchase more vRAM licenses than physical memory in a server is absurd. I don’t need the features in the Enterprise version and currently have several 2 CPU servers with 96GB of memory running 4.1 Standard. Even with the updated licensing, I would still need to buy one additional CPU/vRAM license for each server just to cover the physical memory, but since we’ve oversubscribed the memory I would have to buy yet another CPU/vRAM license to cover memory that doesn’t even exist. Our current servers with 96GB of memory can hold twice that amount, and in the next few years I see us purchasing machines with more memory than even two enterprise plus licenses would allow.
    Unless the 5.0 licensing is adjusted further I don’t think I’ll have much choice but to keep running 4.1 for the time being and look at alternative hypervisors as we bring in new hardware. If you’re going to insist on licensing by vRAM I think you should at least have the option to purchase additional memory allowances over the base (at significantly reduced cost than a full license), instead of requiring me to buy full additional CPU/vRAM licenses plus the yearly support costs that go with it.

  17. Richard Buschkoetter

    In response to Michael Williams:
    “Moving to 32GB of physical RAM for the free hypervisor is certain to be an appreciated improvement.”
    According to the last item on the FAQ – http://www.vmware.com/products/vsphere-hypervisor/faq.html – it is still 8 MB, or (if I am reading it correctly) one “monster” free VM with 32 MB. It used to be 8 MB of vRAM, so this is an improvement.
    I still don’t understand why I wouldn’t stay with the free 4.1 and get 256 GB of RAM; as discussed here – http://blogs.vmware.com/esxi/2009/06/esxi-vs-esx-a-comparison-of-features.html

  18. Steve

    This is a step in the right direction but not far enough. We’ve been exclusively a VMWare shop for ten years now and to have a price hike like this at the same time that almost every company is looking at how to squeeze their budgets to weather the slow economic recovery is just poor judgement. Because of this in the last month we have spun up both HyperV and Xen in our test environments as the cost difference is too great to ignore anymore.
    I understand the need to keep pace with the growth in computing power but I don’t see why you guys chose to use vRam instead of number of processor cores.

    1. Nataliya

      Sorry. That was a litadtle harsh, but it’s been irriadtatading me for for quite a few veradsions, and it’s often comadplained about that linux lacks “easy” illatsners for 3rd-party softadware, which is someadthing (the 3rd-party illatsners) that Linux devs have litadtle to no conadtrola0over.

  19. DCasota

    In less years than expected we will work with “ramclouds” just to satisfy performance and flexibility needs. So the license strategy to use vRAM makes absolutely sense for me. The market penetration with this new license model depends on the ratio SMB/enterprises in a country and on the maturity of the IT. Here in Switzerland we have a lot of SMB companies – this would make it more difficult – however the higher affinity for IT in common sense plays together with the high maturity of VMware products. Therefore I personally think that we will speak with customers more about transition, based on the VMware cloud suite with vSphere 5 and co, than speaking about licensing costs.
    With that said, it’s clear there is always room for other products.
    Of course every company wants to get more for their money spend in IT, but the main cost driver as customers tell us is not licensing, but the costs to increase the know-how internally and the right-sized transition of the systems. Good, robust, well-spread virtualization and cloud know-how is a main factor if a company grows or not. The more the “war of talents in the IT area” will get worse, the more SMB companies will loose their flexibility and strength.
    To come back to the discussion: Most of our customers are companies between 100 – 500 employees. We have talk with them about their business and to align that with internal and public cloud services. The discussion will not be about 20 or 30 Kilo Dollars, Euros or Swiss Francs for the SMB licenses – it’s the future of that particular company we must help to form.

  20. Jimbo

    Hang on, so the hypervisor (free) limit is still 8GB on a typical single-socket test box?
    Regardless, since there is still no formal word on how this will move w.r.t Moores Law, the product remains near impossible to cost over its expected useful life, assuming RAM remains the most contended resource.

  21. JeroenL

    Many of you are not understanding the model correctly.
    For a 3 host, dual cpu, SMB solution. You can now run a group of VM’s with 32x2x3=192GB of virtual ram assigned.
    This also implies that more than 64GB of physical RAM in a single host must be installed to exceed the current vRAM limitations.
    Counting with an average of 6GB per VM means that you can run 32 VM’s. 16 with 4GB vRAM assigned and 16 with 8GB vRAM assigned.
    4GB vRAM is for most servers more than enough.
    If you run a 16 host, quad cpu, enterprise + enviroment you can even assign 96x4x16=6144 of vRAM. Counting with the same 6GB average you can run a total of 1024VM’s.
    It also implies that more than 384GB of physical RAM must be installed in a single host to exceed the current vRAM limitations.

  22. Kim Johansson

    As someone previously said, i guess we should all feel so lucky that vmware decided to double the enforcement, but with 2 sockets , and 512gb ram in each machine, i still need to purchase 6 licenses isntead of 2 (originally 12 licenses).
    Good that Vmware actually listens to its users, but this is still a bunch of bull, vmware stated over the phone that this only affects 5% of their userbase, i wonder why they want to loose 5% of their customers so badly?

  23. Alexander Manfrin

    Sorry, Not´s good enough.
    I have customers that are working on project for 4Q of this year that involve 34 (thirty-four) servers quad core with 1TB of memory each. The cost will be very expensive yet. The probability is that this customer go virtualize with Microsoft Hyper-V or XenServer than vSphere. It´s obvious.
    This entitlement don´t can say how the customers will work with your servers, the customer works how it want! If he want use all memory available, this´s his problem, not from VMware, a customer told this for me today. What I say to this customer? Nothing, VMware close my hands.

    1. Emen

      I carry on listening to the news utadpe lecture about getting boundless online grant applications so I have been looking around for the top site to get one. Could you advise me please, where could i get some?

  24. jignesh.patel

    Some thoughts, in long term itemizing the licensing points usage for features for vCenter only is not enough.
    Similar adaption for other products like vshield suit does make significant difference for SMB players.
    vShield product licensing still restricting customer for deployment due to its licensing.
    for example webhosting, Virutal private hosting Server product line .
    Server isolation is very critical as per the security considerations.
    for low cost product line,we cannot afford to pay for a vshield license points same a running another VM.
    If customer wants to use a single feature like IPspoof guard out of vshield suit costing becomes a burden then feature.
    Suppose customer wants to use vshield only for enforcing IP spoofing security costing for the VM doubles.
    If we can implement points usage per feature inspite of whole suite helps customers to deploy the such products faster.

  25. Alexander Manfrin

    “Sorry, it’s not good enough.
    I have customers that are working on a project for the 4Q of this year that involves 34 (thirty-four) servers quad core with 1TB of memory each. It will be very expensive. The probability is that this customer will virtualize with Microsoft Hyper-V or XenServer than vSphere. It´s obvious.
    This entitlement doesn’t say how the customers will work with your servers, the customer will work how they want to! If they want to use all the memory available, this is their problem, not VMwares, a customer told me this today. What should I say to this customer? Nothing, VMware washes its hands.”

  26. sam

    Typical smb server is two low end 4 or 6 core dl380 G7 with 8 or 16 600 or 900GB sas 10K 2.5″ drives – now that 8gb DDR3 RDIMM is price parity with 4gb – essentials should cover two servers in optimal config – 8gb x 12(96gb) or 144gb – that’s 288gb for operating servers – we then recommend a single server for offsite/consolidate (veeam) which would have 1 socket, 72gb of ram. Since you cannot upgrade essentials nor essentials to standard – you should at least cover in ram a very typical smb with 2 on-site servers and 1 offsite . 192gb of vram isa joke. Also when you say a running 12 month average – are you saying the customers have to submit online a usage or are you implementing an activation system like microsoft that requires connectivity to keep running?
    smb may not seem big to you but it is the first step in the door – so please for essentials base the ram on a feasible 72gb per CPU since it is not upgradable at all. Or allow smb to buy multiple packages of cpu’s (495.00 * 2 ) of essentials so we can cover the little guys.
    Tax the rich more – not the poor!

  27. Joel

    I would have a lot less of a problem with this model if additional RAM could be licensed separately from the CPU licenses at a reduced cost as one of the earlier posts mentioned. This makes WAY more sense than purchasing additional CPU licenses. I can’t see trying to convince an SMB customer that they need to purchase a second full copy of Essentials. Would never happen.

  28. Joel

    I would have much less of a problem with this model if it was possible to purchase licenses for additional RAM separately from the CPU licenses at a significantly reduced price as mentioned in a previous post. This makes WAY more sense. I can’t see trying to convince a SMB customer that they now have to purchase two full Essentials licenses to accommodate the same number of VMs they’ve been running for the past two years. Would never happen.
    I’m still trying to convince customers to move from the free version to Essentials. This is just going to make it that much more difficult.

  29. Vidar

    “VMware vSphere customers with an active SnS contract are
    entitled to upgrade to VMware vSphere 5 at no extra charge.”
    Can VMware please tell me how this can be done AT NO EXTRA CHARGE for a server with 2 cpus and 256GB ram already oversubscribed and running vSphere 4.1 Advanced?

  30. Shawn Constable

    The vRAM Entitlement itself is the problem. There are to many free or cheaper Hypervisors out there to be messing with this. Most of us running VMware already HAVE a license for Hyper-V becuase, IT COMES WITH WINDOWS and/or ITS FREE, and to add managment you are looking at less than the cost of ONE Vmware Host entitlement. Arrrrrrg.

  31. Francisco Batista

    The more i read the more confused i get.
    So in vSphere 5 we will have memory limits for the hosts. My first thought was… this is completely ridiculous. I Have several costumers that have bought Essentials Plus Bundle that have something like 80Gb per host, they have a 3 years active Sns, what happens if they want to upgrade?!?!?!
    The memmory limits are per processor or per host?

  32. jstrubberg

    What I want to know is which VMWare exec has stock in Microsoft?
    All you are doing is driving away customers. I can tell you that under either the original agreement or your revision posted here, my company is going right to Hyper-V. You’ve simply priced yoruself completely out of the market.

  33. Tinkerer Guy

    I should add that my physical host had only 16GB of RAM, I’m just mentioning that for testing, you are allowed to tell a VM you have 64GB of RAM.
    At least for now, I don’t have access to any systems with more than 32GB of physical RAM for a real test, however.

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  37. John Carry

    Kudos to VMware for listening to the market! There’s a reason VMware is the market leader – and it’s not only because of superior products. Looking forward to selling vSphere along with the cloud infratructure products on the merits of new features.

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    VMware for listening to the market! There’s a reason VMware is the market leader – and it’s not only because of superior products. Looking forward to selling vSphere along with the cloud infratructure products on the merits of new features. http://icustomercarenumber.in/

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