Navigating the Shake-Up: Understanding Broadcom’s New VMware Licensing and Your Cloud Strategy
The enterprise IT landscape is undergoing a significant transformation following Broadcom’s acquisition of VMware. The days of perpetual licenses and predictable support renewals are over, replaced by a new subscription-based model that is forcing organizations to re-evaluate their entire virtualization and cloud strategy.
This shift isn’t just a minor policy update; it’s a fundamental change in how businesses will procure, manage, and pay for the foundational software that powers their data centers. Understanding these changes is critical for controlling costs and future-proofing your infrastructure.
The Core of the Change: From Perpetual to Subscription
The most impactful change is the complete discontinuation of perpetual VMware licenses. For years, businesses purchased software licenses outright and paid an annual fee for support and subscription (SnS). That model is now gone.
Here are the key takeaways from the new licensing structure:
- End of Perpetual Licenses: You can no longer purchase new perpetual licenses for vSphere, vSAN, or other core VMware products.
- No More SnS Renewals: Existing Support and Subscription contracts for perpetual licenses cannot be renewed. Once your current term expires, you must migrate to the new model.
- Bundled Product Suites: VMware’s extensive product catalog has been consolidated into two primary offerings: VMware vSphere Foundation (VVF) for mid-sized and smaller deployments, and VMware Cloud Foundation (VCF), the comprehensive hybrid cloud solution.
- The Critical Shift to Per-Core Licensing: Perhaps the most significant change is the move from per-CPU to per-core licensing. There is a minimum requirement of 16 cores per CPU, meaning even processors with fewer cores will be licensed as if they have 16. This can dramatically increase licensing costs for organizations using hardware with high core-count CPUs.
What This Means for Your Business
These changes create a new set of challenges and considerations for IT leaders. The immediate impact is often financial, as the new subscription and per-core models can lead to a substantial increase in operational expenses, particularly for on-premises data centers.
Organizations are now at a crossroads, facing a mandate to assess their current VMware footprint and decide on the most cost-effective and strategic path forward. This is no longer just a renewal conversation; it’s a strategic inflection point that demands a thorough review of your IT infrastructure roadmap.
A Cloud-Smart Path Forward: Google Cloud VMware Engine
As businesses grapple with this new reality, managed cloud services have emerged as a powerful and compelling alternative. Google Cloud VMware Engine (GCVE), in particular, offers a streamlined solution that directly addresses the complexities introduced by the new licensing model.
GCVE is a fully managed service that allows you to run your native VMware workloads—including vSphere, vCenter, vSAN, and NSX—directly on Google Cloud’s high-performance infrastructure. This approach offers a way to escape the new licensing headaches while accelerating your cloud adoption.
Here’s how Google Cloud VMware Engine provides a strategic advantage:
- Simplified, All-Inclusive Licensing: The most significant benefit in this new era is that all necessary VMware software licensing (including VCF) is included with the Google Cloud VMware Engine service. You no longer need to procure, manage, or audit separate VMware licenses. The cost is bundled into a single, predictable service, freeing you from the complexity of per-core calculations.
- Seamless Migration and Operational Consistency: GCVE allows for a “lift and shift” migration of your existing VMware-based applications without needing to re-architect them. Your teams can continue using the same VMware tools, skills, and processes they already know, ensuring a smooth transition with minimal disruption.
- Cloud Economics and Scalability: By moving to a managed service, you shift from a large capital expenditure model to a flexible, consumption-based operational expense. You can scale resources up or down on demand, paying only for what you use and avoiding the costs associated with overprovisioning hardware in an on-premises data center.
- Integration with Native Cloud Services: Once your workloads are running on Google Cloud, you can begin to modernize them by integrating powerful cloud-native services like BigQuery for data analytics, Vertex AI for machine learning, and advanced security tools to enhance your applications’ capabilities.
Actionable Steps for Your VMware Strategy
The transition forced by Broadcom is a prime opportunity to modernize. Instead of simply reacting to the new licensing terms, use this moment to build a more agile and cost-effective infrastructure strategy.
- Audit Your Current Environment: Get a complete picture of your current VMware deployment. Document your hosts, CPUs, core counts, and current licensing renewal dates.
- Model Your Future Costs: Calculate the projected cost of maintaining your on-premises environment under the new per-core subscription model. This will provide a clear baseline for comparison.
- Evaluate Managed Cloud Alternatives: Deeply explore solutions like Google Cloud VMware Engine. Analyze the total cost of ownership (TCO), factoring in the included licensing, reduced operational overhead, and hardware savings.
- Develop a Phased Migration Plan: Determine which workloads are best suited for a move to the cloud. A phased approach can help you manage the transition effectively, starting with less critical applications to build confidence and momentum.
Ultimately, the disruption in the VMware ecosystem is a catalyst for change. While navigating the end of perpetual licensing presents challenges, it also opens the door to a more flexible, scalable, and operationally efficient future in the cloud. Solutions like Google Cloud VMware Engine provide a clear, strategic path to turn this industry shift into a competitive advantage for your business.
Source: https://cloud.google.com/blog/products/compute/broadcom-vcf-licensing-changes-for-vmware-engine/
