vSphere 5 Licensing - The Reality

[chanaka_ek]

OK, now that the whole vSphere 5 launch has taken place and folks around the world are trying to digest everything,  I thought I'd share my views on the new licensing model (yup you got that right....a brand new licensing model....) being employed by VMware for vSphere 5 and beyond...

So... listening to the webcast yesterday and looking at the literature today, their main marketting line for changing the licensing is to enable...or make it compliant with how the cloud operates.. Makes sense right?? However if you peel off all the fancy marketting  paint, underneath they've just make changes

which im my opinion slightly favours VMware (yes more money in the bank....!!)

So the 'Goners' are

1. Removal of the number of cores per CPU for each licensing category = You can have as many cores per physical CPU irrespective of the license type
   
2. Removal of maximum memory limits (per ESX host) based on license category = you can have as much physical memory on ESX servers as possible irrespective of the license type
   

The new introduction is,

1. Licensing is still CPU based (per CPU) but now you have a cap on the maximum number of running virtual memory (active vRAM = memory allocated to all running VMs) at a given time. This is referred to as vRAM and is additive amongst the ESX hosts in the cluster.
   

The vRAM limitations are as below and are per CPU

          24GB vRAM per CPU for Essentials Kit
          24GB vRAM per CPU for Essentials Plus Kit
          24GB vRAM per CPU for Standard
          32GB vRAM per CPU for Enterprise
          48GB vRAM per CPU for Enterprise plus

This sounds complicated and VMware is obviously painting this as cloud friendly and user friendly...etc. But really this is going to make licensing vSphere more expensive to the average customers.

Think about it, the removal of maximum physical memory limit really is a distraction and delivers no real benefit to the customers because without (potentially) buying additional licenses you cannot really allocate those physical memory to running VMs??

Take the below as an example (a common setup amongst most of the VMware customers)

• 2 ESX servers, each with 72 GB pRAM & 2 quad core CPUs (HT enabled)
  
• 9 SQL VMs, each with 16GB of vRAM running on the ESX cluster
  

• Cost of the vSphere enterprise license at present = $3,495.00 per cpu  (same on vSphere 4 & 5)
  
• Cost of the vSphere standard license at present = $994.00 per cpu (same on vSphere 4 & 5)
  

The license costs under vSphere 4 licesing - Enterprise

• Total Number of CPUs = 4
  
• Hence the license cost for 4 CPUs = 2875 x 4 =  $11500.00
  

The license costs under vSphere 5 licensing - Enterprise

• Total vRAM requirment = 16gb * 9 = 144 GB
  
• Number of vRAM allowed "per CPU" = 32GB
  
• Hence the number of "per CPU" licesnes required = $144 / 32 = 5
  
• The new cost = $2,875 * 5 = $14,375.00
  

Thats an increment of 125% approx in licensing costs alone for vSphere 5.

This is even worst if you were on vSphere Standard

The license costs under vSphere 4 licensing - Standard

• Number of CPUs = 4
  
• Hence the license cost for 4 CPUs = 994 x 4 =  $3,976.00
  

The license costs under vSphere 5 licensing - Standard

• Total vRAM requirment = 144 GB
  
• Number of vRAM allowed per CPU = 24GB
  
• Hence the number of "per CPU" licesnes required = 144 / 24 = 6
  
• The new cost = $994 * 6 = $5,964.00
  

Thats is an increment of 150% approx

The way I see it, one of the main reasons why everyone prefers VMware (myself included) was because of the clever memory management techniques they employ which allows you to do memory over provision. The avaialbility of memory reclamation through memory single instancing (TPS), ballooning and compression are all pretty powerful ways that allows us to use more vRAM on a host than the available pRAM without substantial performance degration and it appears that VMware is now using this to manipulate their licensing costs.

So it now goes, the more memory you allocate to VM's the more you pay and while lot of large enterprise businesses may not care about this additional cost, VMware may be pricing themselves out of lot of SME's...(Microsoft...smell blood??)

Anyways this by no means would affect my loyalty to VMware as vSphere is still (and will be for a while to come) the best of bunch for the hypervisors out there. But the new licensing model is a bit of a sucker punch to the average customers and, in reality it is in stark contrast to how it is protrayed out on the marketting materials. instead I would have preferred if they'd come clean and said, here's a new version it cost us money to develop and we need to buy food so the licensing costs would go up a notch.

Cheers

Chan

[MindTheGreg]

Gabriel Chapman wrote:

8GB hard limit essentially makes ESXi a non-starter for using it as a platform for anything other than feature testing. Its simply going to be a test drive version instead of something you can use for home labs, test/dev.

Where did you find the 8 GB ram limit?

[Gabriel_Chapman]

http://www.vmware.com/products/vsphere-hypervisor/faq.html

How much vRAM does a VMware vSphere Hypervisor license provide?

A vSphere Hypervisor license includes a vRAM entitlement of 8GB.

[MindTheGreg]

I can only assume this is new since it is using the new vRAM term. Uncool.

[Gabriel_Chapman]

They could of at least provided some vLube prior to the announcement.

[ats0401]

LOL! :smileylaugh:

[petedr]

I missed that one on reading up on the vSphere 5 licensing change. Wow only an 8 GB entitlement for vSphere Hypervisor. I would agree that makes it only usueful for feature testing or maybe hosts with a few VMs.

www.thevirtualheadline.com

[Camek]

VMware has been very successful in marketed the ability of ESX to make the most effective use of hardware (memory and CPU) and this has allowed them to become the leader.   It now appears they want to cash in on the popularly the product has generated but, the thing they have missed is that companies have been holding off the “accounting” types because we have been able to keep lowering TCO by pushing more and more VMs on to servers with more and more memory and faster and faster CPUs.   If our costs of  vSphere 5 go way up we are going to be forced to move to other solutions (Microsoft) even if it’s not the best solution because in the end TOC wins (remember we also pay maintenance every year to keep new version of the product coming too)…...  I also hope things change because right now I know our View VDI infrastructure is dead because of how we have been using over allocations of memory to make to the costs per desktop work.  

[bilalhashmi]

golddiggie wrote:

We're looking to, eventually, virtualize up to 2000 desktops. IF VMware stays the course on this pricing, I believe the project is going to be inserious jeopardy of being stopped or shifted to a different platform.

The licensing cost for VDI remains the same. It has unlimited vRAM entitlement.

http://www.cloud-buddy.com/?p=402

[mikeyes]

Bilal wrote:

golddiggie wrote:

We're looking to, eventually, virtualize up to 2000 desktops. IF VMware stays the course on this pricing, I believe the project is going to be inserious jeopardy of being stopped or shifted to a different platform.

The licensing cost for VDI remains the same. It has unlimited vRAM entitlement.

http://blogs.vmware.com/euc/2011/07/vsphere-desktop-licensing-overview.html

Keep in mind that:

"This  offer extends only to the purchases of new vSphere licenses.  All  eligible vSphere 4 (or earlier version of vSphere) licenses used for   desktop virtualization will not be upgraded to the vSphere Desktop SKU.   These licenses will be migrated to the corresponding vSphere 5 edition   and not to vSphere Desktop."

Everything you have today even if you use it for VDI will have vRAM limits.  The only thing that will be unlimited will be VMware Desktop licenses purchased after 5 is released.  So as long as you re-purchase you entire VDI infrastructure licensing yes you will have unlimited vRAM resources.

[twindude]

Even right-sizing VMs still hurt on cost and when you throw in all the DR systems setting idled, it’s going to get expensive there is no way around it!

I'm interested in how vBlock UCS plays a role in this now, the flexible Cisco B230 M1 caps out at 256Gb, M2 512gb, so that’s one ESXi host so 2-3 per cluster and the vRAM Cost vs VM ratio will still not work out at 40:1 - M1 - 6gigs per VM with one host (not to mention the risk and having to have other systems with these specs for HA (vmotion/DRS))! Take SharePoint and SQL deployments (core business apps) cost will sky rocket!

You will have exceptions but the exception shouldn't become your license norm which equals dollars!

@Anyone

Can someone help me understand this better.. maybe i'm missing something.......?

UCS Blade Comparsions - look at the memory numbers - how can you justify buying this and doubling up on cost with VMware?

http://www.cisco.com/en/US/products/ps10280/prod_models_comparison.html

[lusid2]

That's just the example I was running through.  Let's say you have a pretty typical, recently shipped ucs chassis with 8 blades, 256g/blade, dual socket.  Ad let's say you are ultra conservative in sizing the environment and don't plan to use tps, memory compression, or ballooning for overcommitment.  You turn on admission control to enforce a one host failover policy, and only plan on using the remaining cluster capacity.  Cluster capacity for ram would be 256 * 7, or 1792 gigs.  You bought licenses under the 4.x model, so you have 16 processor licenses.  Let's say you picked enterprise plus, just to give vmware every benefit on the next calculation.  Your new vsphere5 licenses would cover 768gigs of ram, out of your cluster capacity of 1792 gigs  leaving you out of compliance by 1024 gigs.    You now need 22 more licenses.  Yay!  Now maritz would say, you probably aren't using all that ram yet, just pay us now for what you use today, and pay us tomorrow for what you need the day after tomorrow.  But you would not have bought all that ram if you weren't planning to use it within the fiscal year, so you've only got 2 options. 1.  Put 2/3 of the virtualization project off until next year and hope the licenses make it through the next budget cycle 2. Talk management into paying a huge, unbudgeted vtax to save your project.   Or there is an option 3, hold tight on 4.1 for the life of the environment.  I just don't take that option seriously, since as the rest of the stack evolves over time compatibility issues will take out the environment.  Nw guest os releases, firmware, storage, etc.

[slaclair]

ChanEK wrote:

This will hurt VMware...... (if anyone has any stocks in Vmware... now is the time to sell i'd say.....)

FYI, they're actually in the green today.  Granted this is going to hurt many and it is a shot in the nuts to people that have purchased hardware based around VMware licensing.

I really wish they would either raise the vRAM limits OR take away the CPU & vRAM limits coupled together.  If they're going to charge for "utilization" then I shouldn't be paying for the CPU licenses on standby hosts sitting idle.  At least if those two metrics weren't coupled together people could get creative to find ways to save but if you keep your CPU counts exactly the same then it can only stay the same or go up, there is no option to go lower.

We're probably the rare case of an organization that will not have an impact from the licensing, but it didn't save us either as that option doesn't exist for anybody.

However, my largest concern was VDI licensing and I assumed they were going to kill their VDI solution but the vSphere Desktop licensing model actually cuts our costs in half.

[Ashley16]

Perhaps there is a different angle to this?

You've heard of wintel, perhaps this is the start of vimtel.

Under ESX4 its been cost effective to increase your density with 12 core AMD CPUs over the 6 core Intel.

With ESX5 a Enterprise Plus license you only get 48GB vRAM per CPU making an allocation of;

AMD 4GB/core

Intel 8Gb/core

Assuming a 1/5 over physical allocation in a blade config your 8 cpus will effectively have 60Gb vRAM each capping your per core to;

AMD 5GB/core

Intel 10GB/core

I've seen a lot of enviroments move towards AMD in the last 12 months to reduce the cost of physical hardware, licensing and power, the savings have been substantial.

Before you ask, I do not work for any of the companies involved, I have no inside information.

I'm just basing this on the fact that having a very dense enviroment under vmware is no longer as good as it used to be and Intel have got a hsitory of playing dirty.

[wuffers]

Please take 2 minutes of your time to fill out this vSphere 5 migration survey:
http://wuffers.net/2011/07/18/vsphere-5-migration-survey

We need more data! Results will be posted in the main vSphere 5 licensing thread over at VMTN:
http://communities.vmware.com/thread/320877

[wdroush1]

Ashley16 wrote:

Perhaps there is a different angle to this?

You've heard of wintel, perhaps this is the start of vimtel.

Under ESX4 its been cost effective to increase your density with 12 core AMD CPUs over the 6 core Intel.

With ESX5 a Enterprise Plus license you only get 48GB vRAM per CPU making an allocation of;

AMD 4GB/core

Intel 8Gb/core

Assuming a 1/5 over physical allocation in a blade config your 8 cpus will effectively have 60Gb vRAM each capping your per core to;

AMD 5GB/core

Intel 10GB/core

I've seen a lot of enviroments move towards AMD in the last 12 months to reduce the cost of physical hardware, licensing and power, the savings have been substantial.

Before you ask, I do not work for any of the companies involved, I have no inside information.

I'm just basing this on the fact that having a very dense enviroment under vmware is no longer as good as it used to be and Intel have got a hsitory of playing dirty.

Joked with a friend about this too, he linked me this:

http://vmwareintelalliance.com/

[MAME201110141]

I have a question, and I would like to haven an answer

At this moment I'm running 2 hosts with each 1 quadcore CPU and 96 gb of memory.

At this moment thes hosts run with a Vsphere 4 stanard license.

These hosts are running all VM's containing Oracel Enterprise Linux with on top of it Oracle DBMS

All these VM's have one thing in common huge memory usage.

With the new licensing of Vpshere 5 we've got an big issue.

I may use only 48 gb for VM's and that is to less for my environment.

Instead of ht whole 192 gb of memory.

I know that I'm not going to use the complete 192 gb but 96 gb is the sweet spot for me.

Please advice me how i can use Vsphere 5 in de futur without any extra investment.

If this is not possible then VMware turns his back towards client who run Oracle DBMS on VMware products

Exaclty the same way Oracle does against client that run Oracle DBMS on Vmware in a licensing way.

I cannot believe that 95% of the clients will not pay more for there licensing, it sounds like the information minister of Iraqi  (http://www.welovetheiraqiinformationminister.com/ ) in the gulfwar.

Regards

Marcel

[J1mbo]

Even if 95% won't pay more for their licensing today, that is probably because at least half won't move to v5, today.

Within a year I would have thought that 80% would be paying more (or have started at least a move elsewhere).

[fridge]

If your vSphere 5 upgrade or upcoming projects would be adversely affected by licensing changes contact your VMware or partner sales ASAP.  Don't just complain about vSphere licensing changes on blogs, forums & Twitter; talk to VMware weal real number's if it negatively impacts you.  They are listening to feedback.  Will it cause them to change anything? Who knows but they are listening and discussing it internally.

[drivera01]

It is quite apparent that VMWare has ruffled a lot feathers. Just by the length of this post, it is apparent there is alot of unknowns and uncertenties. This in my oppinion was a bad business decision that I feel they will regret. Human nature is if people are unsure about something, they will stay away from or second guess the need of using the product. I can see it happening in my company. That is too bad since I really believe in the product. however,  believing in the product, having total faith in it is not enough to keep it in a datacenter. Every business around the world knows we are all as a society going thru financial turmoil. This is not the time to add to the problem. Just my .02.

[pauljacques]

On the plus side I was fretting over next years problem of upgrading the real estate to V5, but this license change means I'll stay 4.1ESX & 4.6View. And if after a year I haven't had a need to call support, because I've made all the changes I'm likely to (aka being in cookie cutter mode), I will then not renew VM support. As such, this could actually save me budget. Thx VM, finally you'll start saving me bucks ^_-