Well, friends and casual passers-by, the day has come, and unfortunately, our Mirazon crystal ball was right: The End Of VMware Perpetual Licensing May Be On The Horizon.
VMware perpetual licensing is officially dead (for now, at least), but that is just one of the most significant changes that have been publicly announced as Broadcom starts implementing changes to its new LLC.
In this blog, we will talk about the recent news surrounding VMware perpetual licensing, expected changes, and the next steps you should take to stay ahead of the recent developments.
Recent News About VMware Perpetual Licensing
As many of you know, Broadcom agreed to buy VMware back in May of 2022, and after more than a year of vetting and approvals from the Securities and Exchange Commission in the United States and other foreign entities (China was the last holdup), the acquisition finally closed on 11/22 of this year.
VMware, like all vendors (Microsoft, Veeam, Dell, etc.), has been working toward subscriptions and away from perpetual for a while (see Horizon, which we will get into later). The lure of predictable, recurring revenue is music to every industry’s ears, but with that come simpler offerings, lower barriers of entry to VMware’s enterprise-class product, and more innovation.
This acquisition is essentially diving completely into the deep end of adoption. That being said, what changes can you expect when it comes to VMware perpetual licensing?
Changes To VMware Perpetual Licensing
Perpetual Licensing End of Sale
Perpetual licensing is dead, and support renewals have also followed suit. Effective 12/11/2023, VMware by Broadcom announced their end of sale.
According to their press release, “Offerings will solely be available as subscriptions or as term licenses following the end of sale of perpetual licenses and Support and Subscription (SnS) renewals beginning today” (Prasad, 2023).
For these subscriptions, list pricing is expected to be reduced by up to 50% when compared to the similar perpetual offerings that were available.
VMware has also stated that they will be offering pricing incentives to help customers migrate from their perpetual products over to the new subscriptions.
Restructuring
Broadcom has restructured VMware into four divisions (Sharwood, 2023).
- VMware Cloud Foundation – includes vSphere, vCenter, vSAN and other core products.
- Tanzu
- Application Networking & Security – excludes Carbon Black, which is being divested.
- Software-Defined Edge
Notice that what you don’t see is End-user Computing (includes Workspace One & Horizon).
I said that we would make it back to Horizon, and here we are. According to this press release from December 8th, this division is being divested, so the future is a bit up in the air. Currently, the only change is that partners have to place orders for End-user Computing products separately. The post shares the commitment to the offerings continuing, but more information is currently limited, so stay tuned!
Portfolio Simplification
Within the Cloud Foundation, there will be two main offerings: VMware Cloud Foundation & vSphere Foundation.
Cloud Foundation – This will be your premium offering and will likely include many of the products covered under the Cloud Foundation division.
vSphere Foundation – This will be your standard offering, likely including the core products like vSphere and vCenter.
Add-ons – who doesn’t like an add-on? VMware announced that the main offerings will have advanced add-ons available to complete the solution, including storage, ransomware & disaster recovery, and application platform services (Prasad, 2023).
vSphere Essentials – Many SMBs have received great value out of the vSphere Essentials package. As of now, nothing has been publicly announced to fill this void, but given the value that many of Mirazon’s customers have found in this product, we find it hard to believe an entry-level offering similar to Essentials won’t be offered at some point.
Next Steps For The End Of VMware Perpetual Licensing
First, let’s start with the major thing that many will be worried about, and that is the end of sale of renewals for perpetual products and the perpetual product itself.
If you have an active support contract, that will be honored through its expiration date. Additionally, you can still use your existing perpetual licenses but will be unable to add more (even if support is expired).
If you have a support renewal that is coming up (especially if it is soon), please contact your Mirazon Account Manager, or if you are new, please contact sales@mirazon.com. We will be able to work with you and VMware to determine the best method for migration to subscription.
As of right now, information is still trickling out, but more is expected by the end of the year. Continue checking back with us for more updates as they become available.
Speculation From Mirazon’s Crystal Ball
Mirazon’s crystal ball was brought up earlier at the beginning of this article, so let’s circle back with some speculation (keep in mind that nothing has been announced, hinted at, or indicated in any way by VMware).
If you recall, Veeam made a wide-sweeping push to subscription licensing in 2022 and eliminated socket licensing. After feedback from customers and partners, Veeam changed their stance and opened perpetual licensing back up to existing customers again.
With VMware’s large customer base, it would not be surprising for something similar to happen here too. As the change rolls out, it will be interesting to see what adjustments, if any, are made along the way.
Conclusion
While this isn’t really a surprise given the shifts in the industry and VMware’s move to a subscription model that’s been ongoing for years, it might still be a shock and difficult to deal with. We may not have all the answers right now, but Mirazon is here to help you navigate this change and make the most of your IT investments.
If you have any questions or need any help, please let us know!
If you’d like to learn more about the end of VMware perpetual licensing and the next steps you should take, please contact us by calling (502) 240-0404 or emailing info@mirazon.com.
Prasad, K. (2023, December 11). VMware by Broadcom Dramatically Simplifies Offer Lineup and Licensing Model. Retrieved from VMware: https://news.vmware.com/company/vmware-by-broadcom-business-transformation?src=WWW_US_HPP0_VCF_SiteLink
Sharwood, S. (2023, November 23). Broadcom re-orgs VMware into four divisions – none of which mention end-user compute products. Retrieved from The Register: https://www.theregister.com/2023/11/23/broadcom_vmware_reorg/