VMware changes vRAM licensing on vSphere 5 after customer feedback on vTAX

Change 2 was a clarification of Change 1, which was the new proposed licensing scheme.
 
Fortune 500 companies aren't running to Hyper-V because H-V can't do 1/3 of what they need.
The thing is that not all companies need everything vSphere does. I actually fully expect my academic institution to abandon vSphere in favor of Hyper-V system wide due to pretty much unbeatable Microsoft Site licensing. Currently we are paying $130k a year system wide to VMware (which isn't all that much, and that's the old licensing though I don't think the changes would affect us). In our environment there's nothing we need that Hyper-V doesn't do, and the Microsoft licensing is an order of magnitude lower because unlike VMware they do offer deep deep discounts for academia.

Likewise there are bound to be a lot of other companies who simply don't use most of what vSphere provides. Yes, it's cool that the feature is there but if you don't need it then why pay for it if the alternative does what you need it to do and comes at substantially lower prices.

They didn't expect such a large backlash when people didn't run the numbers honestly on their environment so they backed off a bit to calm people down.
I am trying to look at this with an objective and rational mind. What you are saying is tht VMware changed licensing and most people wouldn't be affected. However, most people didn't run the numbers and simply got upset. Because of that VMware changed its mind on licensing.

Sorry, but rationally that makes little sense if any at all. You don't go through with a business plan and then change your mind just because some uneducated consumers are upset. If anything you educate them which you can do cheaply by email since VMware has all of our info.

Customers were upset, the PR failcascade was all over the blogs and that's what made otherwise content VMware customers actively look for alternatives. That's where the real damage is. If you have a happy customer he or she will not look around for other stuff, but once you have an upset customer you are in the danger zone because what if they realize that they don't actually need you? Angry customers also cause a lot more fuzz than happy ones out there on the internet and damage control can quickly become problematic.
 
Customers were upset, the PR failcascade was all over the blogs and that's what made otherwise content VMware customers actively look for alternatives. That's where the real damage is. If you have a happy customer he or she will not look around for other stuff, but once you have an upset customer you are in the danger zone because what if they realize that they don't actually need you? Angry customers also cause a lot more fuzz than happy ones out there on the internet and damage control can quickly become problematic.

You're making my point for me. People stirred up a lot of bad feelings on the license change so VMware backed off a bit to make people happy even though those people would not have been affected. Simple as that. The change in vRAM numbers is a good will gesture to appease people.

Nothing is going to convince you otherwise except for sitting in VMware strategy meetings so move on. As for people looking at alternatives...well, that's life. I've always said there is a good portion of the market waiting for Hyper-V to be "good enough" and when it is people will switch because MS will make them deals on licensing. That is the ONLY advantage MS has...leveraging their server OS foothold. It's surely not technology or innovation.
 
People have short memories about how Microsoft operates. Things are the way they are because they are innovating to catch up. If they managed to kill off VMware the innovation would stagnate, plain and simple. In the enterprise, like Fortune 500 companies go... good enough is not how they operate. Maybe, if that was the best way to go when taking a holistic point of view, but Microsoft has no where near the feature parity at VMware's enterprise and enterprise plus feature sets.


I work in the enterprise, not fortune 500, but DoD / DISA. We've got hundreds of hosts and thousands of VMs. The thing Thuleman is missing (aside from swinging back and forth between F500 and SMB) is OPEX costs. VMware's (or any vendor's) licensing overall is only one aspect of the whole picture. If you had something to be mad about it should be being STUCK and not having the option to switch vendors. It&#8217;s annoying having to pay more for licensing suddenly, but there is no way that would alone justify switching... well unless it had made much much more of an impact. Training, DR, backups, internal processes, security posture, and man power to switch or to maintain two separate environments ALL cost money. Even something as simple as the massive amount of patches comparatively from Hyper-V to ESXi would weigh in. Those things are far more expensive to change/overhaul than switching from VMware to Hyper-V (or other <insert here> platform). F500 companies have huge ROI numbers to show from VMware over the last 2-3 years and that is not at all going to change by this new licensing scheme -- if it had even stuck as originally detailed. I called this VMware's new coke moment, simply from the SMB point of view. They didn't think people would react so nostalgically. I reacted much like everyone else, especially on the free version, but even if VMware didn't change the scheme and it was going to cost them a huge customer -- you bet your ass they might cut them a deal. I just don't see how the argument holds water. It could have been more of a Novell moment had they not done anything to appease customers or it had affected a larger percentage of customers up front. I think we now know that isn't true and it doesn't matter anyway... they're making changes to make their customers happy. VMware is a great company.
 
The thing is that not all companies need everything vSphere does. I actually fully expect my academic institution to abandon vSphere in favor of Hyper-V system wide due to pretty much unbeatable Microsoft Site licensing. Currently we are paying $130k a year system wide to VMware (which isn't all that much, and that's the old licensing though I don't think the changes would affect us). In our environment there's nothing we need that Hyper-V doesn't do, and the Microsoft licensing is an order of magnitude lower because unlike VMware they do offer deep deep discounts for academia.
VMware has academic discounts, and government discounts.
Likewise there are bound to be a lot of other companies who simply don't use most of what vSphere provides. Yes, it's cool that the feature is there but if you don't need it then why pay for it if the alternative does what you need it to do and comes at substantially lower prices.
Because people have started relying on the features, seriously.
I am trying to look at this with an objective and rational mind. What you are saying is tht VMware changed licensing and most people wouldn't be affected. However, most people didn't run the numbers and simply got upset. Because of that VMware changed its mind on licensing.
Pretty much - It's a company run by engineers and has a very very large and growing social media branch who listens to what people say (as well as a rapidly growing college/academic branch to interface with students and spread the love at that level).
Sorry, but rationally that makes little sense if any at all. You don't go through with a business plan and then change your mind just because some uneducated consumers are upset. If anything you educate them which you can do cheaply by email since VMware has all of our info.
Sure you do. If your goal is to keep customers happy, you make a change that is a compromise. The new licensing might not make a difference now, but in the future people will keep growing and it will eventually require more licenses.
Customers were upset, the PR failcascade was all over the blogs and that's what made otherwise content VMware customers actively look for alternatives. That's where the real damage is. If you have a happy customer he or she will not look around for other stuff, but once you have an upset customer you are in the danger zone because what if they realize that they don't actually need you? Angry customers also cause a lot more fuzz than happy ones out there on the internet and damage control can quickly become problematic.

*potentially look for alternatives, otherwise, pretty much - this is why they made the change. Like any company, there are alternatives and competitors out there. Keep your customers happy, keep making good products, and you win.
 
defuseme2k is probably right, enterprise clients weren't going to jump ship over night. But SMBs looking to virtualize existing infrastructure or build private clouds would have taken a very hard look at alternatives. I need a 3 node cluster and was ready to buy Essentials Plus but when the new licensing was announced I had to install Hyper-V and XenServer on test boxes because I don't have $15K for virtualization. I'm buying hosts with maxed out ram and 144GB vRAM is just silly. Maybe VMware doesn't need my business, and that's their choice to make. We will see tomorrow.
 
VMware has academic discounts, and government discounts.
I didn't say that they don't, I did say that Microsoft's discounts are significantly deeper, up to 90% on stuff that you can use in production because they can and they want that market so that college grads are exposed to the software as they are going through college. The server side gets bundled into a site license deal where the cost per server is substantially lower than the cost of electricity to keep it powered on.

Pretty much - It's a company run by engineers
lopo, I know your heart is in the right place on this one but VMware is run by shareholders and Wall Street. It is inevitable that the pressure to meet forecasts trickles down. VMware's stock price dropped nearly 5% on the announcement of the new licensing scheme, it's currently 10% down from where it was the day before the new licensing was announced and that's amid 35% growth posted in Q1 quarterly results. I am no expert, this could be completely unrelated, but I am just saying that in a publicly traded company engineers rarely have the last word. The originally proposed licensing turned out to be damaging to the company's value and to the customer's perception of the company. In simpler words; It was a fuck up. Now they patched it.

Other than that, I didn't mean to imply that anyone would ragequit using VMware just because of the licensing change. What I did mean to say is that being dissatisfied makes you actively look for alternatives which is something you would not do if you are happy. Some of those customers whether it be Fortune X or SMB will realize that they don't need all the features, that's inevitable. I like to use Photoshop as an example, I have a site license at work and love to use it. However, I only use 1% of what Photoshop is capable of so at home I didn't buy it, I just use Infranview and it fits my needs just fine.

CH2M Hill is one F500 company that did switch to H-V from VMware because it works for them and saves them hundreds of thousands of dollars over vSphere, though they did it last year iirc and unrelated to the current licensing changes. defuseme mentioned TOC and patching. IMHO patching H-V is a non-issue since you need to patch Windows (VMs) anyway and you already have a plan for patching and avoiding downtime.

That's my point really. Whether it's Fortune or SMB, they all run Windows and they all have infrastructure, policies. and knowledge in place to deal with Windows inherent issues. If you have System Center then the switch to H-V isn't too far off if it does all you need. That's all I am saying.
 
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edit: I'm just not going to say anything. It's not worth the effort. Announcement comes tomorrow!
 
What I find absolutely amazing is that they expect MS to continue this super cheap H-V licensing policy forever. Let's play the "what if" game. Do you think that if MS gets to 75% marketshare with H-V their licensing won't change? If they let me buy a single Datacenter license and virtualize 50 servers on a box you don't think that's going to give at some point? REALLY?!

Companies can make their decisions. Any organization of significant size that doesn't look beyond licensing in the cost of infrastructure is doing it very wrong. You can do far more with less with VMware and I'm not just talking the hypervisor..I'm talking all of the other integrations and tools as well.

And as lopoetve said. The announcement is tomorrow. If people don't like it they can go try Hyper-V. We'll see how many stick with it for a full year.
 
What I find absolutely amazing is that they expect MS to continue this super cheap H-V licensing policy forever. Let's play the "what if" game. Do you think that if MS gets to 75% marketshare with H-V their licensing won't change? If they let me buy a single Datacenter license and virtualize 50 servers on a box you don't think that's going to give at some point? REALLY?!
The, what should be obvious, difference between MS and VMware is that MS makes money off of the VMs as well, not just the Hypervisor, thus it only makes sense that they can discount the hypervisor substantially since you will be buying the OS that will run all the VMs from MS as well.

No need to get all riled up. ;)
 
The, what should be obvious, difference between MS and VMware is that MS makes money off of the VMs as well, not just the Hypervisor, thus it only makes sense that they can discount the hypervisor substantially since you will be buying the OS that will run all the VMs from MS as well.

No need to get all riled up. ;)

If you purchase Datacenter licensing then you do not buy licenses for the guest OSes, you just license the host. So in that case Microsoft is only making $3k list per socket even if you are running 50 VMs on that host.
The only exception you could point out is that if you're running all (or mostly) Windows OS guests then you probably have other MS products you will need to license for the VMs - Exchange, SQL, SharePoint, etc. In that case MS is still making money on each VM, but not from the OS. I would expect MS to change the licensing of either Hyper-V and/or Datacenter edition at some point.
 
I would expect MS to change the licensing of either Hyper-V and/or Datacenter edition at some point.

To be honest, I don't. Datacenter licencing was the best thing that MS could do to keep its market share and keep people from looking to lower cost open source solutions. But Microsoft has never, and will never make its money off OS licensing in the enterprise, they make their money off CALs and Software Assurance, sure when you add up licenses for server and desktop licenses for 500 computers, it looks like a lot, but compare that to the cost of CALs for AD, Exchange, Remote Desktop (for TS or VDI), Software Assurance or a Partnership agreement, + everything else. Suddenly the $30,000 I spent to licence all my sockets seems pretty small.

The other consideration is blades. MS makes out really well when you think the average blade chassis has anywhere between 20-50 sockets in it depending on configuration, and usually people have one or two of these. So right off the bat you have anywhere between $60-150,000 for one chassis just in MS costs.
 
As I said before, the changes, if true, make me(mostly) happy. There's a few small issues which I'd like to see touched on, and hopefully they'll will be.

Moores Law Issue - What will VMware do with vRam entitlements with each minor/major release as average VM vRam usage goes up?
Decoupling vRam from a full socket license - Why can't customers just buy more vRam entitlements on their own at a cheaper rate then a full license? Even if VMware doesn't change vRam entitlements in minor releases(5.1, etc), this could be an excellent way of meeting the above concern(moores law) while still making money(for VMware) as vRam usage goes up.

The above concerns are relatively minor, overall the changes if true make me very happy and regain my confidence in VMware.
 
There is no limit from a licensing perspective. The amount of memory you can allocate to a single guest is 256gb.
4.1 ESXi Free while it has no vRam limit, does have a pRam limit of 256GB as well as the following;

Physical RAM up to 256GB
Unlimited physical CPUs, with up to 6 cores each
VMs can have up to 4 vCPU each
 
Better, I still lose a bit of my purchased memory, but MUCH better, to the tune of about $40K...

I had all of upper mgmt freaking out LOL. Thanks a ton VMWare for this crap you pulled. I'm sure you'll do something similar when vSphere 6 comes out too.

The vRAM model is still idiotic when you have to pay maintenance on all licenses and they're still calling them "socket" licenses, even if you need additional licenses above and beyond your socket count.
 
Free version: 32GB overall (pRAM/vRAM).
All others:
Enterprise Plus 48->96
Enterprise 32->64
Standard/essentials 24->32

12 month watermark, not monthly.

VM vRAM cap at 96GB.

editL getting clarification on free if it's pram only, or pram+vram.
 
So this allows me to buy 96GB servers with Essentials Plus. Is there still hard limit if you go over? I read Jason's blog and the part about yearly vRAM audits but I'm not sure if it applies to Essentials.
 
As of right now all entitlements are soft limits. You can exceed, you'll just get an alert in vCenter.
 
For ESXi free, is the 32GB physical limit per socket (like the 8GB limit was supposed to be) or per hypervisor? Example: if I have a dual-CPU system do I get support for 32GB or 64GB physical ram?
 
You get 32GB and that's it. You get it with one socket or two. 32GB.

As for trading up licenses...I bet VMware has a SKU to do that but I've never looked for Essentials.

Good timing on the announcement. I'm starting a series of webinars tomorrow discussing new features and licensing. Now I get to focus more on the features and less on people complaining about licensing.
 
For ESXi free, is the 32GB physical limit per socket (like the 8GB limit was supposed to be) or per hypervisor? Example: if I have a dual-CPU system do I get support for 32GB or 64GB physical ram?

"this limit is GB of physical RAM per physical server"

"vSphere Hypervisor is entitled to 32GB of vRAM
per server (regardless of the number of processors) and can be
utilized on servers with up to 32GB of physical RAM."
 
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Even better changes for the Service Provider Program:

http://blogs.vmware.com/vcloud/2011/07/update-on-vmware-service-provider-program-vspp.html

Reseved RAM with a minimum should have been the model all along, it's a very clever way of charging per VM relative to it's needs. It gives VMware a way to secure revenue as consolidation goes up while allowing us to still fully leverage over-allocation. I wonder why it was only implemented for the VSSP, maybe they really just did come up with it like the blog says.

How do you qualify for this program (assuming you want to provide cloud services using vmware of course)?
 
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My guess is around VMWorld time, which is end of August/beginning of September... I'll be in 100 degree Vegas there. :)
 
How do you qualify for this program (assuming you want to provide cloud services using vmware of course)?

There is no specific VSPP qualification to become a so called Registered member. You just sign up at VMware's site. With this type of membership you don't need to buy anything.

Once you want to buy licenes you need to sign up with a "VSPP Aggregator", a company that manages licenes. Compare it to how Microsoft handle their hosting licenses (SPLA). Often the same company can supply both VSPP and SPLA licenes.
 
Well it's the 22nd of August, I'm browsing vmwares site, no esx5, no esx 5 license upgrade options as of yet...., going for lunch now.
Feels like Christmas, your waiting.. and waiting... then it''' be over.
 
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