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VMware Pricing Outrage: A Closer LookVMware Pricing Outrage: A Closer Look

Many IT admins want to continue over-provisioning memory to virtual machines. But that's not an efficient way to manage the data center.

Charles Babcock

July 26, 2011

3 Min Read

All I can say is that other major software vendors--including IBM, Microsoft, and Oracle--have tried to keep their pricing in step with value and have implemented pricing changes to assure it. At one time, Oracle announced it would count each core as a separate CPU license (which would have caused Weimar Republic-style price inflation) then backed off the stance. Oracle and Microsoft are also unapologetic about surprise customer audits that result in a large additional bill for allegedly unlicensed use.

So far VMware's approach is comparatively more conservative. Infrastructure 5 pricing charges $995 for Standard edition per CPU with a limit of 24 GB of allocated virtual memory; $2,875 for Enterprise edition with a limit of 32 GB per CPU; $3,495 for Enterprise Plus, with a 48-GB limit. If your allocated memory to VMs is much greater than they actually use, it may be possible to shave the VM allocations and continue with charges as before. This will be difficult for some of VMware's largest customers, say those who have gone the extra step and virtualized their database systems. I asked Sue Workman, associate VP in the office of the CIO at Indiana University, if the pricing changes would affect the school's mix of VMware and Citrix XenServer. "IU will continue to use VMware as our primary virtualization platform for enterprise servers and the Intelligent Infrastructure," she said via email. "Over time, we will use the experience we gain with Citrix/XenServer in supporting client virtualization to evaluate the mix of virtualization." That strategy shows a long-term possibility of some server migration away from VMware, but not very much outrage over the immediate pricing. And Indiana U is one of the places where the change will have an impact: it has virtualized its memory-hungry Oracle databases. Customers now have the chance to begin getting a handle on CPU memory usage and stop treating it as a freely available resource. In some ways, that's a drawback, imposing extra work and forcing a decision that might be proven wrong at a later date. But it was probably inevitable this day would come in one form or another. Efficient data center operation will one day depend on knowing what is an accurate allocation of memory for each VM on a given CPU. Eventually, shops engaged in deep virtualization will gain the means to change that allocation on the fly, with automated systems handling the task and sending the system admin a notice. Customers will increasingly find themselves confronted with the choice between continuing to pay a premium for advanced virtualization, or settling for the gains they have and resisting further advances with more charges. There are cheaper alternatives available in Citrix XenServer (about two-thirds the price of VMware) and Microsoft's Hyper-V (free as a part of Windows Server 2008 R2), and VMware knows it. Customers hope VMware is not bent on milking their Infrastructure customers. VMware hopes it hasn't guessed wrong on the true value of its virtualization software. A service catalog is pivotal in moving IT from an unresponsive mass of corporate overhead to an agile business partner. In this report, we chart the new service-oriented IT landscape and provide a guide to the key components: service catalogs, cost and pricing models, and financial systems integration. Read our report now. (Free registration required.)

About the Author(s)

Charles Babcock

Editor at Large, Cloud

Charles Babcock is an editor-at-large for InformationWeek and author of Management Strategies for the Cloud Revolution, a McGraw-Hill book. He is the former editor-in-chief of Digital News, former software editor of Computerworld and former technology editor of Interactive Week. He is a graduate of Syracuse University where he obtained a bachelor's degree in journalism. He joined the publication in 2003.

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