Understanding VMware New Licensing Model
- Zo Jakab
- Dec 29, 2023
- 3 min read
Updated: Nov 4
VMware users are facing major changes after Broadcom’s acquisition. Perpetual licenses are no longer available, and all products are shifting to subscription-based bundles with per-core pricing. Broadcom has also introduced a capacity-based model for vSAN licensing.
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Each CPU under Broadcom’s VMware model requires licensing for at least 16 cores, even if it has fewer. Some licenses now have a 72-core minimum per product instance. This affects hardware planning—servers with fewer cores may still need full licensing, so match your core count to VMware’s rules before purchase.
VMware New Licensing Model - What These Changes Mean
The old “buy once, use forever” approach is gone. VMware products are now sold through subscription bundles such as vSphere Foundation and VMware Cloud Foundation. Pricing depends on CPU core count, and regional discounts vary. Because the pricing structure changed completely, companies must reassess their expected spending and adjust renewal cycles.
VMware New Licensing Model - Understanding the New Pricing
Broadcom now prices vSphere and related components per CPU core. Exact rates are not public and can differ by agreement, but early reports confirm higher costs for most customers. Many contracts include a minimum core count, often 16 or 72 per CPU, which can increase total licensing expenses for modern multi-core processors.
When planning budgets, use a five-year horizon instead of the three-year period Broadcom often references. This gives a clearer view of the total subscription cost compared with the older perpetual model.
VMware New Licensing Model - Bundles and Feature Access
The product lineup has been simplified:
vSphere Enterprise Plus is now offered mainly through bundles such as vSphere Foundation. These include vSAN and Aria (formerly vRealize) management tools, even if you don’t plan to use them.
This means traditional SAN or NAS users may end up paying for vSAN functionality they don’t need.
vSAN capacity is now tied to the number of licensed cores. Adding more storage requires extra capacity licenses.
Standalone products such as NSX or Aria Suite are no longer sold separately. To use these, you must move to VMware Cloud Foundation, which includes the full software-defined data center stack managed through SDDC Manager. These bundles carry a higher per-core price than previous separate licenses.
VMware New Licensing Model - Price Impact Over Time
Third-party analyses indicate that total licensing costs have increased by 50% – 150% for many enterprises compared with the old perpetual licenses. The exact difference depends on CPU size, chosen bundle, and the number of hosts. Users with 24-core or 32-core CPUs will notice higher per-server expenses.
Discounts also appear less generous than before. Many customers report reduced flexibility for renewals and fewer promotional deals.
VMware New Licensing Model - Steps to Take
Check your current core counts – confirm how many cores you will license.
Review your VMware bundle – identify which features you use and which ones are bundled automatically.
Request updated pricing – from your VMware reseller or Broadcom partner to see the real subscription cost.
Plan for five years – to estimate renewal totals and prevent surprises later.
Compare with alternatives if subscription costs exceed your long-term budget.
VMware New Licensing Model - VMware Alternatives
If the new structure does not fit your cost plan, several enterprise options are available:
Proxmox VE – free, open source, supports both VMs and containers.
Nutanix AHV – integrated hypervisor for Nutanix hardware or clusters.
Oracle VM – included at no cost for Oracle customers.
Linux KVM – open-source virtualization widely used in enterprise environments.
Cloud IaaS and Kubernetes – for those shifting workloads toward container-based infrastructure.
VMware-Compatible Servers for ESXi & vSphere: Save Up To 80%
✔️ 5-Year Warranty – No Risk: Pay Only After Testing
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