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SuperSpike
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Contributor

vSphere 5 Licensing

I took a minute to read the licensing guide for vSphere 5 and I'm still trying to pull my jaw off the floor. VMware has completely screwed their customers this time. Why?

What I used to be able to do with 2 CPU licenses now takes 4. Incredible.

Today

BL460c G7 with 2 sockets and 192G of memory = 2 vSphere Enterprise Plus licenses
DL585 G7 with 4 sockets and 256G of memory = 4 vSphere Enterprise Plus licenses

Tomorrow

BL460c G7 with 2 sockets and 192G of memory = 4 vSphere Enterprise Plus licenses
BL585 G7 with 4 sockets and 256G of memory = 6 vSphere Enterprise Plus licenses


So it's almost as if VMware is putting a penalty on density and encouraging users to buy hardware with more sockets rather than less.

I get that the vRAM entitlements are for what you use, not necessarily what you have, but who buys memory and doesn't use it?

Forget the hoopla about a VM with 1 TB of memory. Who in their right mind would deploy that using the new license model? It would take 22 licenses to accommodate! You could go out and buy the physical box for way less than that today, from any hardware vendor.

Anyone else completely shocked by this move?

@Virtual_EZ
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wdroush1
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Hot Shot

DSTAVERT wrote:

Complaining here does nothing for any of your future plans. Make your VMware rep aware of your future plans and how you may be affected in the future.

Don't talk about this in public, keep it behind closed doors.

Ok, we get it.

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FREDYz
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Not much surprising for a company who has as CEO an ex 14 years Microsoft executive. Yes, I will say again Microsoft. Paul Maritz worked there for many years and probably have "learned" a lot.

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DSeaman
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Enthusiast

I talked to my VMware licensing guy today about VDI workloads, and more specifically, options for non-View users like us that have XenDesktop. I wrote up the summary here:

http://derek858.blogspot.com/2011/07/vsphere-50-vdi-licensing-changes.html

Derek Seaman
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twindude
Enthusiast
Enthusiast

Some were not happy before this license change:

Virtualization Cost Savings Disappoint Enterprises: Survey

http://www.eweek.com/c/a/Midmarket/Virtualization-Cost-Savings-Disappoint-Enterprises-Survey-346835/

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wdroush1
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Fernando wrote:

Not much surprising for a company who has as CEO an ex 14 years Microsoft executive. Yes, I will say again Microsoft. Paul Maritz worked there for many years and probably have "learned" a lot.

How much stock does he still have in Microsoft? Smiley Wink

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cabraun
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Enthusiast

Brian Madden had the same interpretation of the blog post on "vSphere Desktop" as I did.  New non-View VDI deployments will likely benefit from the licensing model.  We begin our XenDesktop deployment soon and from a licensing standpoint it will cost us only slightly more than the "vSphere Advanced" licensing we were planning on purchasing for our VDI environment and several hundred thousand dollars less than what we were faced with if we had to purchase "Enterprise" or "Enterprise Plus".

http://www.brianmadden.com/blogs/brianmadden/archive/2011/07/15/confirmed-vmware-will-introduce-a-ne...

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lusid2
Enthusiast
Enthusiast

The fundamental frustration here is that everyone on vmware has licensed their capacity.  Had vmware grandfathered everyone into the new model at their current capacity, we would be having a very different conversation right now.  People would actually be rushing projects throu to get in before the deadline.
Instead, projects are being put on hold or cancelled altogether.  Recent purchasers  are feeling particularly burned.  
Looking at the big picture, is is a watershed moment for vmware.  This is where they find out if they have a monopoly or not.  If the larger customers start v2v migration projects this year, they don't have a monopoly.  Maritz is clearly betting that they do.  Time will tell.

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zeringue2011101
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Contributor

I read the new licensing model as well, and am not happy about it.  I am looking to expand my 11 host cluster to 16, and we are about to purchase 32 more blades with 256GB of ram each.  Now this licensing nonsense will throw a wrench in the plan.  I am not happy. I am the sole decision maker for my department and we may have to go with good enough hyper-v or stay with 4.x.  I am not interested in having to relicense my environment when i add memory or need to run more machines.

I have a small 5 node hyper-v cluster, and now i will explore red hat's and citrix's solutons.

Now a days i can easily switch from VMware to something else.

We left oracle for the same reasons, licesning is complicated and expensive.  I have to buy datacenter licesning too on top of multiple CPU licesnes for two cpu servers to run vmware. Yuck.

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scowse
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Enthusiast

Persactly! This is the the M$ pricing model based on price gouging and charging what the market will bear.

While the "something is worth what you can get for it" adage holds true here it does nothing to engender good will and loyalty.

Vmware has given a massive shot in the arm to all other virtualisation projects which, remarkably enough, includes M$

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Full_Halsey
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DSTAVERT wrote:

Complaining here does nothing for any of your future plans. Make your VMware rep aware of your future plans and how you may be affected in the future.

I must say I am now in complete agreement with this statement. I am convinced that nobody in authority from VMware is going to make any kind of statement regarding the hundreds of valid concerns stated here and I am wasting my time and effort. There is a conspicuous lack of commentary from outspoken senior forum contributors, many of which I doubt will go on record since this is a no-win situation for them to chime in on. I would hate for their book sales or appearance fees at VMUG events to get damaged in any way.

There's nothing else for me to say that hasn't already been said in the forum and with my rep. From this point forward, my company's IT dollars will do the talking.

I hope everyone has a nice weekend. With any luck, this nice cool front that just moved through the south will help my golf game, which is in complete disarray at the moment.

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Bernd_Nowak
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Hot Shot

While this might be true from my histories it might help the customers which you can put inside these groups: healthcare, government and education.

If I talk about the small companies prices are prices and most of the times I can't lower prices for them. On the other hand with nearly no profit for me in this smaller segments, trying to actually 'talk', and not email or voice mail, is a time consuming afford.

Not sure about the future but I will watch this carefully.

On a side note. Customer now has purchased n Enterprise Plus vSphere 4 licenses with software contract. If the user stays on 4.x can he expand and buy additional 4.x licenses or will every new purchase be 5.x and will enforce the vRAM limits in licensing terms?

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none95
Enthusiast
Enthusiast

So, VMware still charge per-CPU yet they now limit the vRAM.

And they don't even offer a cheaper vRAM only license. People have not only to buyr regular CPU licenses for CPUs they don't have, and also pay SnS for them.

And they announce it as if it was good for the customers because they were removing limitations from previous versions. Ahah.

I'm glad I had time to stall my new server refresh. We were planning to move from our current quad socket servers to two sockets with maxed out RAM. That would now make me spend more on vsphere than on the actual harware.

After this licensing change I took all week setting up a XenServer and Cloud.com environment. Looks pretty decent for a totally free and opensource solution.And if or when I want a supported version, they just charge me on a per-server basis without any limitation.

R&D already stalled their project to buy a new "dev" cluster with vCloud.

Next VMs will no longer be deployed on vSphere if VMware doesn't raise their limits or backoff.

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ragmon
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Enthusiast

Disclaimer: I work for HP and my comments are based completely on my own opinion

For several years we've been encouraging our VMware customers to "scale-up" by purchasing ever-increasing amounts of RAM when they reach a hardware refresh cycle or decide to expand their virtual infrastructure capacity.

Recently, We've been able to provide customers with 2-way servers configured with 192GB, 256GB of RAM (and even more) at highly competitive prices.

Now the same clients are extremely disappointed of VMware's new licensing policy for vSphere 5.0 and some have even mentioned something about exploring "other options".

Something has to change. And quick!

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JDLangdon
Expert
Expert

ragmon wrote:

Disclaimer: I work for HP

For several years we've been encouraging our VMware customers to "scale-up" by purchasing ever-increasing amounts of RAM when they reach a hardware refresh cycle or decide to expand their virtual infrastructure capacity.

Our hardware provider has also been for years encouraging us to scale-up to bigger boxes that can utilize more RAM.  Persoanlly, I will not be a bit surprised to see people switch hardware providers over these licensing changes.  I know it's not the hardware providers fault but the bottom line here is ROI.  If someone was encouraged to buy something with the promise of a specific ROI and now that ROI is drastically reduced because of any change what so ever,there is going to be a negative impact upon the person who did the encouraging in the first place.

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ragmon
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JDLangdon wrote:

Our hardware provider has also been for years encouraging us to scale-up to bigger boxes that can utilize more RAM.  Persoanlly, I will not be a bit surprised to see people switch hardware providers over these licensing changes.  I know it's not the hardware providers fault but the bottom line here is ROI.  If someone was encouraged to buy something with the promise of a specific ROI and now that ROI is drastically reduced because of any change what so ever,there is going to be a negative impact upon the person who did the encouraging in the first place.

Disclaimer: I work for HP and my comments are based completely on my own opinion

Need I remind you, that we as a server hardware vendor, or any other vendor for that manner, cannot be held responsible for licensing changes made by "Third-Party" software vendors such as VMware.

If Oracle, or any other software vendor, would change their licensing policy tomorrow morning for the worse, would you also hold the server vendor responsible? of course not!

We are always doing our best to serve our customer's best interests. Our recommendation to "scale-up" was only to allow our customers to save costs!

BTW: here is an opinion of another HP colleague:

http://h30507.www3.hp.com/t5/Around-the-Storage-Block-Blog/vSphere-5-0-and-2TB-of-memory/ba-p/95473

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JDLangdon
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ragmon wrote:

Disclaimer: I work for HP

Need I remind you, that we as a server hardware provider, or any other provider for that manner, cannot be held responsible for licensing changes made by "Third-Party" software vendors such as VMware.

While you might think you cannot be held responsible, there are CEO's out there who will decide it's cheaper to start scaling out then it is to scale up.  When that happens, these same CEO's will look at hardware vendors and remember how they were encouraged in the past and by whom.  That's when you'll see companies not only seriously consider switching their software provider, but also switching their hardware providers.

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JDLangdon
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ragmon wrote:

Disclaimer: I work for HP

We are always doing our best to serve our customer's best interests. Our recommendation to "scale-up" was only to allow our customers to save costs!

I agree that you probably were only trying to save your customers money but now they are going to end up paying a lot more to utilize what they previously purchased.

This is where the vendors need to get on board and make VMware aware that these new changes are no acceptable.

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rjb2
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Enthusiast

Wayne wrote:

It isn't just you.  We just purchased ten dual-socket servers with 192GB RAM each (enterprise license level) and we'll need to triple our license count to be able to use all available RAM if allocated by VMs.   Ridiculous if this is true.

If you have the Enterprise version, you are in the very worst position. Your cost for vRAM is more than 2X the cost of those who purchased Standard, and 23% higher than Plus. This is illogical and very painful for those of us who bought Enterprise. And has anyone looked at the cost of upgrading to Plus.....wait until you see the premium that you will pay to do that.

VersionvRAM per CPUPer GB vRAM
Standard24$                  41.63
Enterprise32$                  89.84
Enterprise Plus48$                  72.81

The entitlements are clearly messed up; something like this would have made a bit more sense.

VersionvRAM per CPUPer GB vRAM
Standard24$                  41.63
Enterprise64$                  44.92
Enterprise Plus96$                  36.41

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davide_delta
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Contributor

NOTE: I work for a italian company that is IBM business partner

In the last 4 weeks we were pushing a customer to buy 3 dual socket systems,

with 256 GB of ram each.
Those x3690 IBM machine, with E7-2870 10 core cpus, can reach 1 TB of ram.

At the moment the customer need only 384GB of RAM and 40 cores, for the production
environment, but it plans to work with this new enviroment for 4 years and the possibility
to expand the ram is part of the plan.

But hey, other 384GB of RAM and 20 cores are there not only for HA but they
can also be good for more development and/or more testing purpose cases.

We proposed vSphere Advanced license (the acceleration Kit) for 6 processors,
plus subscription and production support for 3 year, list price was about 20.000$


What is the new math for the same customer under vSphere 5?


Suppose that we needed vSphere advanced only because the standard versione was

limited to 6-core CPUs.

So, this are the math:

384GB : 24GB = 16 x vSphere Standard CPU Licenses

vSphere 5 Standard acceleration kit (8 CPUs) + vCenter Standard with 3 year
production support is 20000$, plus we need 8 Standard CPU for 1800$ each,
which means 14400$ more.

This is not to say that with this math, they have 384GB of ram UNLICENSED, if we
want to license all the physical ram (as is with vSphere 4) we get 28800$ more.


With vSphere 4 advanced that upgrades to vSphere 5 enteprise, we can see
what license cost we have with enterprise licenses for vSphere 5:

384GB : 32GB = 12 x vSphere Enterprise CPU Licenses

Say that we acquire the advanced kit (vSphere 4) for 20000$ (which upgrades
to vSphere 5 enterprise) and 6 more Enterprise CPU Licenses, which means
$4700 x 6 = 28200$ more to have 384GB available.

For the whole 768GB of ram, we have even 56400$.


So, 20000$ for 6 CPU and 3 year of support for ALL the resources the
customer is going to buy and eventually use, would cost, at the mininum,
34400$, to have LESS features (Standard instead of Advanced) and half
the RAM usable!


This is an unfortunate case, of a non average customer? I don't think.

Wait, with advanced edition the customer is limited to 256GB of ram per host,
so if we want to increase ram the customer need enteprise plus licenses,
ok, so suppose we sell TODAY a vSphere 4 license that the customer will
need PERHAPS 2 year from now (because he really likes the most exciting
feature of Enteprise Plus vSphere edition).

Ok, so we propose to our customer to buy the enteprise plus acceleration kit,
for 8 processors, because of the attractive pricing, so for 43000$ the customer
have the possibility to increase the ram to 512GB or even 1TB, and to buy another

host, with 33% more horse power if this is needed.


With vSphere 5 enteprise plus acceleration kit we have 6 cpus, for the same
43000$!!!!!, which means 288GB of vRAM entitlement and 11400$ for 2 more cpus...

But, what if we want to reach 512GB of ram for each host, and say 768GB of
vRAM entitlement. With old vSphere 4 Enterprise Plus, there is not problem.

With new vSphere 5, we need 45600$ more for the 384GB of more vRAM entitlement.

And I don't what to do the math for full physical ram entitlement...


I understand that VMware want to increase revenues, and scale-up is a way
of limiting VMware licenses, but the vRAM entitlement they have proposed
are WAY to small.

I have made some calculation, based on experience of our customers, and
used as a base the spec of hardware of the last year, I think that more

reasonable vRAM entitlement should be:

24GB - vSphere Hypervisor

24GB - 1CPU for Essentials Kit
48GB - 1CPU for Essentials Plus Kit


32GB - 1CPU for Standard
96GB - 1CPU for Enteprise
192GB - 1CPU for Enteprise Plus

Eventually, they can ask 30% more for each single license, but this pCPU,
vRAM model, is foolish.

The more VMware will wait to change their mind and change this vTax Model,
the more Microsoft will benefit, vast majority of customers has already
Datacenter Edition licenses for their machines, and even if the feature
and the maturity of Hyper-V is distant from vSphere, the price difference
is REALLY REALLY too much.

I hope many and many more will ask for a change, I hope ...

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lusid2
Enthusiast
Enthusiast

As upsetting as this all is, it is still going to be cheaper to scale up than to scale out.  You have to buy the VMware licenses either way, but buying scale up RAM is cheaper than scale out server nodes and all those other licenses that are still sold on a per-socket basis (windows datacenter, foglight, etc).  You are just buying licenses for the fictitious servers you would have needed had you scaled out.

For new customers, if you can somehow talk them into going with VMware you can do the math on a whiteboard to show that.   New VMware customers are like unicorns, but if you find one you can still show a cost savings on smaller workloads consolidation projects.

On bigger workloads, VMware has decided they don't want you running them and priced themselves out of the large workload virtualization projects.  Its now much more cost effective to do a physical deployment, and there is just no way to fudge the math to show a positive ROI.  It is technically impressive that they can do them, but impractically cost prohibitive to attempt in real life.

THe pain point is current customers, because even if you run the numbers and aren't immediately affected VMware has "stolen" capacity from you that you are going to have to "buy back" from them when you need to use it.

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