Users Outraged Over New VMware Pricing Policy - InformationWeek
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Art Wittmann
Art Wittmann
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Users Outraged Over New VMware Pricing Policy

Licensing costs will skyrocket to indefensible levels under new method of charging for memory usage.

I reported Tuesday on VMware's announcement of its latest product, vSphere 5.0. At that time, I was pleasantly surprised to hear that VMware was not changing its base pricing. And while that's true, the company has drastically revamped how it treats and now charges for memory usage. The result will be much higher licensing costs for many users.

Under the vSphere 4.1 licensing model, users pay per CPU with certain limitations placed on the CPU and memory. With the more entry level versions of vSphere 4.1 each CPU could address 256 GB of RAM, while the Enterprise Plus version had no limits at all on RAM; the number of cores per CPU was limited to 6 and 12 respectively. Under the new licensing model, the physical limitations have been removed, but the RAM limitation has been replaced by what VMware calls a vRAM entitlement.

Here's where the new costs come in, and where they can add up very quickly. Those vRAM entitlements per license are relatively small. For vSphere Essentials, Essentials Plus, and Standard edition, the limit is 24 GB, Enterprise edition gets you 32 GB and Enterprise Plus edition gets you 48 GB of vRAM. If you're used to buying two-socket servers with 256 GB of RAM, under the Enterprise Plus entitlement you'd need six licenses in order to actually use all of the RAM in the server whereas you would have needed just two licenses in the old model. At $3,495 per license, the additional cost to go to vSphere 5 is $13,980 for this one server.

VMware points out that vRAM is treated as a pooled resource. However, in order to get any advantage from that pooling, customers would need a significant number of servers configured with less than the licensed amount of vRAM--for two socket servers, that's less than 96 GB. vRAM is a total of RAM configured for VMs, so there may be some minor relief for those who configure RAM usage at two-thirds to four-fifths of the total available RAM. However, for users who oversubscribe their allocations, they'll have to pay for more vRAM than their servers actually have physical RAM.

VMware Pricing
(click image for larger view)
VMware Pricing
VMware users who've reviewed the model have been universally displeased with what they've found. It's hard to blame them. At its announcement Tuesday, VMware painted the new licensing as a way of freeing users of concerns about new hardware, and while it's certainly nice that no restrictions are being placed on core count or physical system RAM, the cost of that freedom will be incredibly high.

One user on VMware's forum wrote: "We just bought 4 new Dell R910's with 256 GB of RAM, I guess we don't fit into the 90% of the customers [[who VMware says]] will not be affected by the license change. I guess we will be sticking with 4.1 for a while. We will have to buy 6 more enterprise+ license to use all of our memory in these boxes. I will not be able to hold off management wanting to move to Hyper-V since we own data center licenses already."

For Aaron Norris, a system administrator at Dovetail Business Solutions, the problem is even worse. "Vmware is not allowing customers with vSphere Essentials or Essentials Plus to upgrade with additional CPUs (and now memory), they require you to upgrade to the standard or enterprise acceleration kits which are very significantly more money than the essentials." Norris said via email. "I'm using the vSphere Essentials Kit in my environment and am using 3 HP DL380 G7 servers with 72 GB of memory each. I'm currently able to use all 216 GB of memory between all 3 servers for my VMs. With the licensing changes in vSphere 5 I'm now only able to use a max of 144 GB or 66% of my memory. If I want to be able to use all of my memory again under the new model, I would now have to upgrade to the vSphere Standard Acceleration kit and also purchase one more CPU license of vSphere standard to get 216 GB of vRAM allotment.

"vSphere Essentials Plus retails for $4,300 and vSphere Standard Acceleration Kit retails for $15,619. Add in one CPU [[license]] of vSphere Standard for $995 and the total cost to $16,614. This is a price increase of about 380% based on my scenario," he said.

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