Enterprises running software on CPUs with more than 32 cores will have to pay more starting April 2
Some VMware customers and partners will soon have to pay more for CPU cores on servers running its software under the company’s newly announced pricing model.
The Lowdown: Under the new CPU software licensing plan that begins April 2, customers that have more than 32 cores per CPU will have to pay for additional licenses.
The Details: VMware will continue with its per-CPU pricing model. However, starting in April, the company will require a single software license for CPUs running up to 32 physical cores. If the CPU used in a server has more than 32 cores, organizations will need to buy additional CPU licenses.
Per some examples, a server running a single 28-core CPU will continue to need only a single license because of the 32-core ceiling. However, a server running a single 64-core processor will require two licenses under the new pricing model. Systems with two 32-core CPUs will require two licenses, while two 64-core CPUs will require four licenses.
In a statement announcing the change, VMware officials said the move is needed to allow the company to come into closer alignment with the way most vendors in the industry license their software and that the extra cash will help it invest in future innovations.
Among the products that will be impacted by the pricing change are Enterprise PKS (for Kubernetes deployments) and NSX Data Center (network virtualization platform) subscriptions.
The Impact: Most VMware customers run software deployed on Intel- or AMD-based servers that use chips with 32 or fewer cores, according to the company. In addition, existing customers who buy software licenses before April 30 that will be deployed on systems with more than 32-core CPUs will be eligible for additional free per-CPU licenses to cover the extra CPUs on the server.
Licensing enterprise software on a per-core or per-socket basis is the norm in the industry, so VMware isn’t an outlier. But any change to licensing costs could have customers examining their options, which may be good for rivals like Nutanix. In addition, Intel with its Xeon portfolio and AMD with its Epyc lineup both offer chips with as many as 48 or 64 cores, so organizations will have to factor that into their plans for VMware.
Background: In the third quarter of its fiscal-year 2020, VMware – a Dell Technologies company – saw revenue hit $2.46 billion, a 12% jump over the same period a year earlier. License revenue was $974 million, a 10% year-to-year increase. The company also has been busy buying companies, including cybersecurity vendor Carbon Black for $2.1 billion, cloud player Pivotal for $2.7 billion, and, most recently, network analytics company Nyansa.
The Buzz: “Today’s announcement is a continuation of VMware’s journey to align our product offerings to industry standard pricing models,” VMware officials said in the announcement. “The change moves VMware closer to the current software industry standard model of core-based pricing. This approach will make it easier for customers to compare software licensing and pricing between VMware (using per-CPU with up to 32 cores) and other vendors (using per-core pricing). It also helps us keep our pricing simple and relevant to where the hardware market is going. … CPU cores are the main software licensing metric across the industry….”