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VMware virtualization solutions for small medium business cost less and provide more value

Last week VMware announced very positive business results for the first quarter 2010, beating analyst expectations by a considerable margin. Needless to say, we are thrilled to see how customers continue to turn to VMware to reduce complexity, dramatically lower costs, and increase business agility.

In the earnings call, our execs also described how we saw strong momentum in our vSphere bundles for small and medium businesses (vSphere Essentials, vSphere Essentials Plus and vSphere Acceleration Kits). For some people, hearing this may be a bit of a surprise as other virtualization vendors have been trying to create the misconception that VMware’s virtualization is too expensive for small businesses. Microsoft, for example, claims that Hyper-V and System Center are 3x to 12x less expensive than the VMware’s Essentials bundles. Ultimately, nothing better than positive business results demonstrates how such claims are a misrepresentation of reality, but just in case, here is some simple math that proves it.

In the table below we compare the cost of software licenses and support to deploy a virtualization solution with centralized management and the ability to quick recovery from hardware failures. The size of the deployment is 3 virtualization hosts (2 CPUs per host) running 15 VMs total.

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As you can see from the table, VMware Essentials Plus is actually about $800 cheaper than a comparable offering from Microsoft even when only considering licensing cost and assuming equal consolidation ratios. While we believe that cost per application is a better approach to determine cost of acquisition for large and small/medium businesses, we wanted to debunk our competitor’s claim using their preferred methodology – upfront software license costs.

Price is certainly an important element of consideration for a small business; however it is not the only advantage that explains the momentum of the VMware Essentials bundles. Reliability, ease-of-use, unlimited technical support calls, and rapid recovery from unplanned hardware failure are also other very important ones. In the last couple of blogs (“VMware ESX to ESXi Upgrade Center – Check it Out!”, “Jumpstart a free virtual environment in a few clicks with VMware GO and ESXi”) we have talked about how and why VMware ESXi is a more reliable, robust and easy-to-use virtualization platform. VMware’s solutions for SMBs are based on the same core technology that the largest companies in the world use in their production environments — there just is not a more proven x86 virtualization platform out there. Why settle for less when you can afford to get the best? I guess many people have already figured this out.

In my next blog, I will discuss in greater detail the advantages that vSphere Essentials Plus offers for recovery and protection from hardware failures.

9 thoughts on “VMware virtualization solutions for small medium business cost less and provide more value

  1. Jake

    Interesting considering you do not need to have System Center Essentials to manage the hosts or VMs. You also get Live Migration / vMotion, HA, etc with Microsoft with out it.

  2. Moyer

    SCE 2010 can manage both physical, virtual, desktops, users, etc. It is not even close to a apples to apples comparison. VMware is about the virtualization world only. Not to mention you do not even need SCE 2010 for your virtual environment, as a matter of fact you do not even need VMM for an environment that small. You can to Live Migration and HA just with Hyper-V manager and Cluster Manager for an environment that small with no issues.
    There is enough FUD from both sides without more added on.

  3. Alberto Farronato

    Jake,
    Thanks for commenting. You bring up a good point. While System Center Essentials is not a mandatory component of the solution, it becomes one once you scratch the surface and realize that SC VMM on its own doesn’t allow to monitor VM performance in useful way. Performance monitoring isn’t something that even small business can leave without when running production apps in a virtual environment

  4. Jake

    Also one thing I forgot to mention, if you have SCE 2010 you do not need VMM as it is included with SCE 2010.

  5. Alberto Farronato

    Moyer,
    I am not sure how familiar you are with good social media behavior, but when you work for a vendor you should qualify yourself.
    With respect to your comment, I am not sure I completely follow your logic. Are you saying that both SC Essentials and VMM Workrgoup Edition do not provide any value in addition to what Microsoft gives for free? Last I heard both solutions were designed to respond to the needs of small medium business. In a virtual infrastructure how many servers do you expect a small company to have?
    Are there free solutions available in the market that could be used? Sure. VMware ESXi and VMware GO are other examples in addition to the one you give. Clearly there are trade offs associated with choosing them over a solution with centralized management.
    PS
    Do you also use Google Search?

  6. julien

    As a VMware and Microsoft distributor, i observe SCE2007 is never bought in a virtualisation deal => only VMM that meets all the SMBs customers needs (P2V conversion, hosts management, clustering, HA and live migration).
    SCE2007 is just too much expensive just to monitor applications.
    SCE2010 is very very aggresive in terms of price (http://www.slideshare.net/julienrayes/sce-2010pptpptx) and includes VMM.
    Unless VMware decreases substantially its prices, i think Microsoft will continue to gain market shares (my company sold x3 system center licenses this quarter…)

  7. Alberto Farronato

    Julien, based on the PowerPoint you linked, it doesn’t look like SCE 2010 is cheaper than Essentials Plus. At $100 per VMs a 30 VMs configuration with SCE 2010 will cost about $3,000 (exactly the same license cost as vSphere Essentials Plus). At this price SCE 2010 still won’t include a backup solution which instead vSphere Essentials Plus offers (Data Recovery). If you add DPM to SCE 2010, the price per VM goes off the chart to $400 (always according to the PowerPoint you link to). For environments of 30 to 50 VMs (max limit for SCE 2010) vSphere Essentials Plus is ends up being cheaper on a per VM basis even of the $100 per VM edition of SCE 2010.

  8. julien

    Alberto, you are right, if a SMB wants to manage about 30 VMs, System Center Essentials is not particularly competitive. The advanced features like PRO Tips will be hard to sell.
    Probably i will continue to just sell System Center Virtual Machine Manager Workgroup Edition that costs $ 632 as u mentioned in your chart.
    To backup VMs, the customer usually continues to use his favorite tool (Symantec Backup Exec, Acronis,…)
    Or use Windows Server Backup.
    I don’t think Vizioncore and Veeam have already released a backup solution for Hyper-V but probably soon.

  9. julien

    Hi,
    I just wanted to rectify some mistakes i wrote in my previous posts.
    System Center Essentials 2010 is now licensed by physical server and not by VM.
    That means a 30 VMs configuration with 3 hosts costs 3 x 120€ (sorry i am european 😉 if u chose Microsoft Essentials.
    VMware Essentials fetches 900 € (or 405€ with the current -50% promotion)
    As to features:
    MS Pros:
    HA, Live Migration, Pro Tips (an equivalent to DRS), hardware and application monitoring, deployment tool, “Management Packs” for troubleshooting
    VMware Pros :
    You have memory overcommit, priorization when you restart your VMs and basically that’s just about it (let’s put aside VMware FUDs about Hyper-V install complexity, better NIC drivers support, wider OS support => i never got support from VMware when i had isssues with debian but the Debian communauty is very helpful).
    It looks like a compelling solution to SMBs customers.
    The same goes with Essentials Plus.
    You want to manage 30 VMs with 3 hosts you pay 900 + (3 x 400 €) = 2100 €.
    Please note that prices may vary (because Essentials Plus will be released in July 1st) but u have the whole idea.
    Microsoft Essentials Plus contains Data Protection Manager 2010 which is roughly superior to VMware Data Recovery (correct me if i am wrong) and remains cheaper => VMware Essentials Plus is 3000€
    Time will tell…

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