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VMware blinks on vSphere 5 licensing

VMware has increased the vRAM licensing entitlements in its vSphere 5 licensing model. But some users hope the changes do not end there.

VMware has responded to the uproar over vSphere 5 licensing, raising the vRAM limits that users feared would increase costs and reduce flexibility.

In addition, VMware has instituted a cap so that customers can use giant virtual machines (VMs) -- vSphere 5 supports VMs with up to 1 TB of memory -- without paying through the nose. The company said it made these changes, just three weeks after announcing the new licensing model, to better fit with how customers today assign memory to VMs.

“Partners, OEMs and others … quite frankly were much more forthcoming with additional information than they were before we announced,” said Alberto Farronato, a senior product marketing manager for VMware.

The new virtual RAM (vRAM) limits are “based on what customers were telling us they were planning to invest in, in terms of hardware configuration, in the next 12 to 18 months,” he added.

VMware users welcomed the news as a necessary improvement over the original vSphere 5 licensing model.

Licensing is still tied to processors, and we'll see that going away.

-Jeff Byrne, Taneja Group

“Sales teams hated it,” said Bob Plankers, a virtualization architect for a large Midwestern university. “Customers hated it. The customers told the sales teams, ‘Now we’re going to have to think about this stuff. … Our new deployments? We’re stopping and reconsidering.’”

VSphere 5 licensing changes
Here’s a look at the initial vSphere 5 vRAM entitlements and how they have changed with today’s news:

  • VSphere Hypervisor (free ESXi): was 8 GB, now 32 GB
  • VSphere 5 Standard, Essentials and Essentials Plus: was 24 GB, now 32 GB  
  • VSphere 5 Enterprise: was 32 GB, now 64 GB
  • VSphere 5 Enterprise Plus: was 48 GB, now 96 GB

In addition, only the first 96 GB of vRAM will count toward the vRAM licensing limit, regardless of the actual VM size. Under the original vSphere 5 licensing model, it would have cost around $75,000 to license a VM with 1 TB of assigned memory. Now, that same VM will only cost the price of an Enterprise Plus license: $3,495 per CPU.

For cloud infrastructures, rather than charging for the maximum amount of vRAM used, VMware will use a rolling 12-month average of daily usage to determine charges. This approach is similar to how VMware handles per-VM licensing for its vCenter line.

VSphere licensing still in transition?
The vSphere 5 licensing change comes as VMware faces more competition from other vendors, especially Microsoft, than it ever has before. Amid the initial furor over the new model, some customers said they’d look more closely at Hyper-V and Citrix Systems’ XenServer.

“Increased competitive pressure, combined with a ton of their customers rising up and talking about how this was way more expensive, has really led to this,” Plankers said.

Many users see this change as only the first step in the evolution of VMware’s licensing. Although vSphere 5 licenses include vRAM limits, they are still based on physical CPUs. VMware officials said the possibility of vRAM entitlement packs (separate from CPU licenses) wasn’t of particular concern to customers who provided feedback to the company, but it has been among the more popular suggestions for making vRAM more palatable.

Some users still see that as the future of the model.

“[That] would probably be something they would look at in the future, because moving to the vRAM model would allow you to more easily charge back your customers,” said Chris House, a technical engineer for MetroHealth, a medical provider in the Midwest.

VMware itself hasn’t ruled out 100%-virtual licensing in the future, either. In fact, that was one of the vSphere 5 licensing options VMware also considered before the product launch.

“They’re kind of stuck in the middle right now,” Plankers said. “A lot of their enterprise license agreements are CPU-based. But at some point they’re going to have to just cut over completely.”

Jeff Byrne, senior analyst and consultant with the Taneja Group, agreed.

“They’re really trying to move from a much more traditional, per-hardware, per-processor model to a more service-based, per-VM utility model, and this is a first step for them to do that,” he said. “Right now the licensing is still tied to underlying processors, and I think we’ll see that going away, maybe in the next two to three years.”

Other users said they’d like to see even higher vRAM limits at the lower licensing levels. Tom Howarth, an independent consultant based in the U.K., suggested that vSphere 5 Standard, Essentials and Essentials Plus should have 48 GB vRAM entitlements, instead of 32.

“Although the uplift on the lower level editions is welcome, I still don’t think that’s enough,” he said.

Beth Pariseau is a senior news writer for Write to her at

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