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VMware users debate per-VM licensing

VMware claims that per-VM licensing will cut costs for customers. But some users are leery of VMware's new pricing-and-licensing scheme.

VMware says its new per-VM licensing-and-pricing model for vCenter products will help customers cut costs. Some users see potential management benefits, but few are enthused by the changes.

Under this new model -- a shift from VMware Inc.'s traditional per-processor licensing and pricing -- users pay for licenses based on the average number of powered-on virtual machines (VMs) running the software over a 12-month period. In this way, VMware contends that users will no longer have to pay for spikes in usage over the course of a year.

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Users who see server consolidation as the chief benefit of virtualization are less than happy about the change.

"What you're doing is turning virtualization back into a physical model where you have to keep track of all the different pieces, and you end up watering down the cost savings," said Christian Metz, a systems administrator at a Fortune 300 company.

Users also worry that per-VM licensing threatens flexibility and scalability.

"A huge part of the benefit behind going virtual is the freedom behind it: the fact that you can go out there and buy a couple of quad-core processors, and just pay for the socket," Metz said. "It's all about buying it up front and knowing what you paid for and having the freedom to build out what you need."

Per-VM licensing details
Applications subject to the new model include AppSpeed, CapacityIQ, Site Recovery Manager (SRM) and the data center management products acquired in the Ionix deal with EMC -- but not to the vCenter Server management suite. VCenter Server will track usage of these applications on VMs in the customer infrastructure, and at the end of 12 months, users can pay VMware for any additional licenses they may need to cover their usage.

I don't want to limit what I can virtualize.
Israel Lawson,
director of virtualization technology
Metz was leery of this end-of-year reconciliation model.

"We need to be able to look at budgets and plan for budgets," he said. "And if there's this unknown, what that ends up creating is the potential for additional costs at the end of the year, which is bad for everybody."

But some see this model as a plus.

"The whole idea of on demand is actually pretty nice, because when you need something, you can go ahead and use it, as long as you know what the price is going to be," said Bob Plankers, virtualization architect for a large Midwestern university. "If you know that it's going to be $1,000 to turn it on for your 26th VM, then it's no big deal. You can just budget for it."

Other users said the new licensing model discourages the deployment of vCenter applications in some environments. Israel Lawson, the director of virtualization technology for a large healthcare administration software company, said his organization shies away from otherwise-attractive tools if they have per-VM licensing.

"The licensing option where you pay per socket is significantly more attractive," Lawson said. "I don't want to put a limit or a governor on what I can virtualize. … I want to pay for the host, I want a software license on the host, and anything I run on top of that host, that's the reward. … That's my ROI."

Per-VM licensing perks
Despite concerns about cost and flexibility, some users see potential management benefits with the new pricing scheme, depending on the application.

"If I wanted to monitor the performance of 25 specific VMs, they might let me buy a 25-license pack and monitor those specific VMs," Plankers said. "If I can do that, that would actually be a net bonus, rather than having to license my whole environment."

But with applications such as CapacityIQ that work across the whole infrastructure, that benefit might not be as strong, Plankers said.

"It might be a wash," he added. "You're probably going to license your whole environment, and the whole idea is using one of those tools to cram as many VMs as you can on a piece of hardware."

Robert Zelinka, the director of infrastructure for TTX Co., said per-VM licensing will save money in his shop, "but only because we've embraced virtualization across the board."

And Nasser Mirzai, the senior director of IT TradeBeam Inc., is another supporter of the model.

"If you have a thousand-license installation, the chances that all of those licenses will be used would be very, very unlikely," he said. "But if you're only buying 100 licenses, and you break down the cost difference of per-VM licensing to something like $200, that's not enough to get everybody out of shape. It's better to have a menu-type choice."

Beth Pariseau is a Senior News Writer for Write to her at

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