How to Negotiate vSAN and vSphere Together in Broadcom Deals
Introduction – Why vSphere and vSAN Go Hand-in-Hand
VMware vSphere (for compute virtualization) and vSAN (for storage virtualization) are foundational technologies in modern data centers. They power the compute and storage layers of a virtualized environment, often working in tandem as part of a hyper-converged infrastructure.
Because these two products complement each other to deliver a full software-defined data center stack, enterprises frequently deploy them together. Read our complete guide to VMware Licensing Changes Under Broadcom: vSphere, vSAN, NSX & More.
This close relationship means that when it comes time to strike a deal or renew licenses, negotiating vSphere and vSAN together is both logical and advantageous.
Doing so can maximize your buying power, keep your environment’s core components in sync, and prevent gaps where your compute is licensed. Still, your storage virtualization is not (or vice versa).
Under Broadcom’s ownership of VMware, this pairing is even more pronounced. Broadcom is streamlining VMware’s product offerings and often bundling vSphere and vSAN within the same licensing packages.
In practical terms, if you’re looking to renew or purchase VMware infrastructure software now, you will likely find that vSphere + vSAN go hand-in-hand in the proposals.
Understanding this dynamic is crucial to developing a robust negotiation strategy.
The goal is to leverage the combined importance of compute and storage virtualization in your environment to secure the best possible deal while maintaining the flexibility to use these products as needed.
Broadcom’s Packaging of vSAN and vSphere
One of the first things to recognize in negotiations is how Broadcom now packages vSAN licenses in relation to vSphere.
Historically, VMware sold vSphere and vSAN as separate components – for example, you’d buy a vSphere license per CPU for your hosts, and then if you wanted to enable vSAN on those hosts, you’d purchase a separate vSAN license (also per CPU) for each host in the vSAN cluster.
This meant that vSAN was essentially an add-on tied to vSphere, but it was tracked as its own product with its own editions (Standard, Advanced, and Enterprise).
Broadcom’s acquisition of VMware has led to a shift toward simplified, bundled subscriptions.
In the new Broadcom licensing model, vSAN is largely embedded in broader bundles rather than being sold as a standalone line item, as it was previously.
Key points about this new packaging approach include:
- Subscription Bundles Include vSAN: Broadcom has reduced the number of SKUs by rolling core products into suites. For instance, offerings like VMware Cloud Foundation and VMware vSphere Foundation now bundle vSphere Enterprise Plus together with vSAN (usually vSAN Enterprise edition features), along with other components. If you opt for these bundles, you automatically get rights to use vSAN on those hosts as part of the package, often with a certain amount of vSAN storage capacity included per CPU core.
- Fewer Standalone vSAN Options: Under Broadcom, vSphere and vSAN are no longer commonly sold as completely separate standalone products for large enterprises. Instead of buying a separate vSAN license edition for each host, you’re encouraged (or required) to buy a combined license bundle that covers both compute and storage virtualization. In practical terms, this means you should clarify with Broadcom what your options are. For many customers, the choice might be between different bundle levels (for example, a full Cloud Foundation suite versus a vSphere-only bundle). If you specifically request vSAN licensing, Broadcom may present it as a capacity add-on to those bundles (e.g., purchasing extra vSAN storage capacity in terabytes) rather than a traditional per-CPU vSAN license.
- vSAN via Cloud Foundation: Broadcom is heavily promoting VMware Cloud Foundation (VCF), an all-in-one suite that includes vSphere, vSAN, NSX (network virtualization), and more. In VCF, vSAN is an integral component – you cannot buy VCF without vSAN, as it’s part of the hyper-converged stack. For organizations looking only for vSphere + vSAN, Broadcom might push VCF as a “complete” solution. However, be cautious: Cloud Foundation includes components (such as NSX or management tools) that you may not need, and it typically comes at a premium price. Understanding this, you may prefer VMware vSphere Foundation (VVF), an edition that includes vSphere + vSAN (but not the full NSX networking stack). Ensure you ask whether vSAN can be licensed independently of Cloud Foundation. In many cases, Broadcom will offer vSAN as part of VCF or VVF bundles, rather than an à la carte product.
- Legacy Perpetual vs. New Subscription: If you previously had perpetual licenses for vSphere and vSAN, note that Broadcom has moved VMware to subscription-only licensing for new purchases and renewals. This means you’ll be negotiating terms such as subscription duration, renewal conditions, and included services, rather than a one-time perpetual license fee plus support. The new subscriptions are often per-core (for vSphere) and per-capacity (for vSAN) based. For example, each CPU core on a host might require a license, and each bundle might include a certain amount of vSAN storage (with the option to buy more capacity licenses if your storage needs exceed the included amount). Typically, minimums are in place (e.g., a minimum of 16 cores per CPU, which has been the standard); proposals have even mentioned larger minimum commitments in some cases. All of this underscores the importance of understanding Broadcom’s packaging: it is now a bundle-centric, subscription-centric model.
Takeaway: Before negotiating, ensure you have clarity on how vSAN is being offered in your deal. Is it coming automatically with a vSphere bundle? If so, what edition of vSAN (likely Enterprise) and how much storage is included?
Are there separate SKUs for additional vSAN capacity, and what are their costs? Knowing the packaging lets you avoid paying twice or buying an all-in-one bundle when you might only need specific components.
It also sets the stage for leveraging the combined deal in your favor.
Read more about NSX licensing, NSX Licensing Under Broadcom – What Buyers Need to Know.
Benefits of Bundling vSphere + vSAN in Your Deal
Once you understand Broadcom’s packaging, it becomes clear that bundling vSphere and vSAN in one negotiation can work to your advantage.
There are several benefits to negotiating these core products together rather than in isolation:
- Stronger Discount Leverage: Vendors like Broadcom typically offer larger discounts for larger purchases. By combining your vSphere (compute) and vSAN (storage) needs into a single deal, you’re increasing the total contract value. A larger, bundled deal gives you more leverage to request a more aggressive portfolio discount on the combined spend. Essentially, the more you spend in one go, the more wiggle room Broadcom’s sales team has to reduce prices. They will be keen to secure a bigger contract covering both products, which puts you in a position to negotiate a better percentage off list price than if you negotiated each product separately at different times.
- Aligned Renewal Cycles: Bundling also means you can co-term licenses and align renewal dates for vSphere and vSAN. This is operationally convenient – you won’t have to renegotiate vSphere this year and vSAN next year (which could expose you to pricing changes or contractual shifts in between). Instead, you negotiate a single contract (such as a 3-year subscription) where both vSphere and vSAN components renew together. Aligning these timelines makes future planning easier and ensures that your compute and storage virtualization capabilities scale together. It also gives you a single point in time to reassess your needs and costs holistically, rather than piecemeal.
- Portfolio Pricing Opportunities: When discussing both products at once, you can introduce the idea of a portfolio-wide discount or bundle deal. Broadcom’s reps understand that vSphere and vSAN are core to your VMware environment – by committing to both, you become a more valuable customer. This opens the door to negotiating special pricing tiers or bundle SKUs that might not be offered if you were only interested in one product. For example, if you’re renewing vSphere and considering rolling out vSAN on new clusters, mention them together – you may be eligible for a bundled promotional rate. Always ask, “What additional discount can we receive for purchasing both vSphere and vSAN together?” and ensure that this is explicitly reflected in the quote.
- Simplified Deal Process: A practical benefit is the simplification of paperwork and approvals. A combined contract or purchase order for vSphere and vSAN results in less administrative overhead compared to two separate deals. From a negotiation standpoint, you can tackle all points (pricing, terms, support, etc.) in one go, which can shorten the negotiation cycle and avoid repetitive back-and-forth. Vendors appreciate not having to go through multiple sales processes for related products, and often extend goodwill in the form of better terms for their efficiency.
In short, bundling vSphere and vSAN gives you more clout. It’s a classic case of the whole being greater than the sum of its parts: the combined deal value is larger, and you can use that to push for concessions that might be harder to get on smaller, separate deals.
Just be sure that in exchange for this larger commitment, you secure the flexibility and protections you need – which we’ll explore next.
Flexibility Challenges When Bundling (and How to Overcome Them)
While bundling can unlock discounts, it also introduces a risk: reduced flexibility.
Broadcom’s default stance may be to blanket-license your environment with vSphere and vSAN together, which isn’t always what enterprises actually need.
It’s crucial to anticipate these flexibility challenges and negotiate terms to address them:
- Partial Adoption vs. Full Coverage: Not every enterprise uses vSAN across all its servers or clusters. You might have specific clusters where vSAN makes sense (for example, for remote offices or certain applications), and other areas where you continue to use traditional SAN storage or another solution. The challenge is that Broadcom, by bundling vSphere and vSAN, may push for an all-or-nothing approach – essentially expecting you to license vSAN for every vSphere host. This can lead to over-licensing, where you pay for vSAN on hosts that don’t actually use it (resulting in shelfware). To avoid this, make it clear in negotiations that you require selective deployment. You should not be forced into a situation where buying vSphere automatically means buying vSAN for 100% of your environment if you only plan to deploy it on, say, 50% of your hosts. Flexibility to adopt vSAN on your own timeline and scope is key.
- Broadcom’s Push for Enterprise-Wide Bundles: Broadcom may attempt to upsell you to broader suites (such as Cloud Foundation) or to license 100% of your environment under a new, bundled subscription. Their argument may be that a comprehensive bundle simplifies management and ensures you have all capabilities. However, this often comes with a hefty price tag and includes components you might not use immediately. For example, Cloud Foundation would bundle in NSX (network virtualization) and more – a fantastic option if you need it, but a waste of money if you don’t deploy those features. The risk is vendor lock-in to a full stack when you only wanted vSphere and vSAN. Counter this by negotiating for modularity. If you only want vSphere and vSAN, state that explicitly and resist attempts to include unrelated products unless they’re essentially free or deeply discounted. You can also negotiate a right to carve out or drop unused components at renewal if you find you never used them.
- Ensuring Selective Deployment Rights: To preserve flexibility, get contractual language that allows partial adoption. For example, include a clause such as “Customer is not required to license vSAN for servers or clusters where it is not deployed.” This kind of provision means that if you have 200 vSphere-licensed hosts but only 100 of them will run vSAN, you are within your rights to purchase vSAN licenses for just those 100 (or, in the new model, perhaps to designate only certain core licenses as including vSAN). It also protects you from an audit standpoint – you don’t want a compliance situation where not running vSAN on a licensed host is somehow considered a breach. Make sure the contract scope clearly delineates which systems are covered by vSAN and which are not.
- Ability to Expand on Your Terms: Another aspect of flexibility is the ability to grow your usage. If you start with vSAN on a subset of workloads, you want the freedom to expand later at a predictable cost. Negotiate up front that you can add more vSAN capacity or additional hosts running vSAN at the same pricing you agree to now (we’ll cover this in detail in the next section on cost). Essentially, you need the flexibility to say, “Today we’re licensing 50 hosts with vSAN, but if next year we decide to enable 10 more hosts, we can do so under the same per-unit cost and terms, without a whole new negotiation or price hike.” This avoids the vendor locking you in now and then gouging you later for expansions.
Strategy: Be skeptical of any “one-size-fits-all” bundle that Broadcom offers.
It may sound convenient, but unless it’s clearly saving you money and aligning with your actual usage, you should push back and tailor the deal to your needs.
Emphasize during talks that your adoption of vSAN will be phased or limited by design, and thus, the deal must accommodate that.
By flagging this early, you set the expectation that any proposal must include flexible deployment and growth terms – not just blanket coverage that treats your entire infrastructure as homogenous.
Cost and Licensing Dynamics to Watch (vSphere & vSAN Under Broadcom)
Broadcom’s changes to VMware’s licensing model have a direct impact on cost structure, and understanding these dynamics is essential for negotiation.
Here are the key cost and licensing factors to keep in mind for vSphere and vSAN under Broadcom’s regime:
- vSphere Per-Core Licensing: VMware vSphere is now sold on a per-CPU-core basis, with a minimum of 16 cores counted per physical CPU. This is a shift from the previous per-CPU licensing (which did not consider core counts beyond a certain point). The new model means that if you have modern servers with high-core-count processors (e.g., 32, 48, or 64 cores in a CPU), you will need multiple core licenses for that single socket. Cost implication: Environments with beefy servers could see significantly higher costs since a single server might consume several licenses if its core count is high. For example, a dual-socket server with 64 cores per socket effectively counts as 4 x 16-core units per socket, so eight units total for that host. This can drastically increase the vSphere licensing cost compared to older models. Negotiation angle: If your environment is full of such high-density CPUs, highlight this and press for greater discounts due to the inflated effective cost. Broadcom is aware that their per-core model raises prices – you can use that fact to justify needing a better discount to stay within budget.
- vSAN Licensing – From Per-CPU to Bundled/Capacity: Traditionally, vSAN licenses were per CPU (with different editions unlocking different feature sets). Under Broadcom’s simplified packaging, vSAN is often included as a feature (specifically vSAN Enterprise capabilities) within certain subscription bundles. In those bundles, there is usually an entitlement of storage capacity included (for example, a bundle might include a certain number of TB of vSAN storage per core licensed). If you go beyond that capacity, you’d purchase additional vSAN capacity add-on licenses (per TB). So, while you might not be buying “vSAN Standard per CPU” licenses anymore, you are effectively paying for vSAN through the bundle and potentially through capacity licenses. Cost implication: If you license all your hosts under a bundle that includes vSAN, you could be paying for vSAN across the board. If your actual vSAN usage (in TB or number of hosts) is lower than that, part of your spend might be for unused capacity. It’s important to right-size the vSAN portion of the deal. Make sure the included capacity in the bundle is sufficient for your needs, so you’re not immediately forced into extra purchases – but also be wary of paying for vastly more capacity than you plan to use.
- Scope Creep and Cost Escalation: Without clear delineation, costs can escalate. Imagine an initial deal where Broadcom licenses your entire environment with vSAN “just in case” you use it, at a high level of capacity. You might agree, thinking it gives you flexibility, but what if you end up using only half that capacity or half those hosts for vSAN? You’ve effectively overpaid. Conversely, if you only license a small portion and then need more, you could face out-of-contract pricing for expansion (which is often higher once the vendor has you committed). This is why negotiating the scope and future pricing now is crucial. Define exactly which clusters or how many cores are being licensed for vSAN functionality. Make sure it’s documented that, for example, “vSAN licensing in this agreement covers X cores across Y clusters,” so you don’t later get a compliance claim that you should have licensed more. And equally, ensure that if you grow beyond that, you have a predetermined price (or discount level) for additional licenses – otherwise Broadcom might quote a much higher price later when you’re locked in.
- Impact of Broadcom’s Pricing Philosophy: Broadcom is known for a more aggressive pricing strategy compared to VMware’s pre-acquisition approach. Many customers have reported significant price increases or less generous discounting on renewals. Expect the list price for vSphere and vSAN subscriptions under Broadcom to be high – often higher than what you may have budgeted based on past VMware pricing. It’s not uncommon to see quotes that, without negotiation, are substantially more expensive than previous arrangements. Knowing this, plan your negotiation stance accordingly: you will need to push for cost concessions to bring the deal into a reasonable range. Part of that is leveraging bundling (as discussed), and part is locking in future costs (so you don’t get hit with an even bigger jump later).
In summary, be very clear on “what exactly am I paying for, and for what usage?” Break down the quote: how much is attributed to vSphere cores, how much (if any) to vSAN capacity or bundle uplift, and what assumptions are baked in about deployment scope.
Don’t be afraid to ask Broadcom for a detailed cost breakdown of the bundle vs. if you licensed things separately.
Even if they only sell it as a bundle, understanding the cost allocation helps you identify where you have room to negotiate (e.g., if the vSAN portion seems overpriced relative to value, you might argue that you could use an alternative, giving you leverage to get that portion reduced).
Negotiation Tactics for a vSphere + vSAN Deal
Armed with the understanding of packaging, benefits, flexibility needs, and cost drivers, you can now employ specific negotiation tactics to get the best outcome.
Here are some strategic tactics to use when negotiating vSphere and vSAN together under Broadcom:
- Bundle Your Purchase for Maximum Discount: Signal to Broadcom early that you intend to make a combined purchase of vSphere and vSAN (and other relevant VMware products, such as NSX or Horizon, depending on your environment). By aggregating your needs into one deal, you put yourself in a position for a bigger discount tier. Broadcom will see a larger contract value and should be more willing to come down on price. Make it clear that your agreement to include multiple products is contingent on receiving a “portfolio bundle discount.” In negotiation discussions, explicitly use that phrase and ask for an additional percentage off due to the multi-product nature of the deal. For example, you might say, “We are effectively increasing our spend by adding vSAN to this renewal – in return, we expect at least a 20% better discount than if we were renewing vSphere alone.” Even if you don’t name a number, insist that the bundling be recognized with a meaningful cost reduction.
- Negotiate Future Expansion at Locked Prices: One of the most important tactics is to lock in your pricing for future needs now. Broadcom’s default quote will cover the licenses you are buying today, but you should also consider the future needs of 2-3 years. Your capacity demands will likely grow – you may need to add more servers (requiring additional vSphere cores licensed) or expand vSAN to new clusters (requiring more vSAN capacity). If you don’t negotiate this now, Broadcom could charge whatever they want for those additions later. To avoid that, include a clause such as: “Any additional vSphere cores or vSAN capacity purchased during the term will be at the same unit price as in this agreement.” This is often referred to as a price hold for expansion. It guarantees you can scale up without a cost penalty. Broadcom might resist a permanent lock, but you could negotiate it as a right for a set period (e.g., during a 3-year term, or up to a certain volume threshold). The key is to eliminate the uncertainty of future pricing. You can phrase it in plain language: “Customer may expand vSAN capacity at the same per-unit license price for the full contract term.” Getting this in writing means no surprises – if you need 20% more licenses next year, you pay the same rate as your initial purchase, not some new, higher list price.
- Secure a Renewal Cap or Multi-Year Rate Protection: Since you are likely signing up for subscriptions, you must anticipate what happens at renewal (end of term). Broadcom has been known to impose steep increases at renewal, unless the contract is contractually capped. Negotiate a cap on renewal price increases, ideally in the range of 3–5% annually (or whatever you consider acceptable and in line with inflation/market rates). For example, include a term like: “Upon renewal, the annual subscription price per core and per TB shall not increase by more than 5% from the previous term’s rate.” Another approach is to sign a multi-year deal now that already has the rates for each year set or capped. If you commit to a longer term (e.g., a 3-year or 5-year agreement), use that as leverage to say you deserve price protection. Broadcom might agree to fixed pricing for the entire term or, at the very least, agree that if you renew, the increase will be limited. This shields you from unexpected budget spikes and provides predictability. It’s much easier to sell a deal internally if you can tell your CFO that you’ve negotiated limits on any future price growth.
- Maintain the Right to Use vSAN Standalone (Avoid Forced Cloud Foundation): Broadcom may attempt to migrate you to their “whole cloud” vision (Cloud Foundation) in the future. Ensure your negotiation explicitly states that you have the right to continue using vSphere + vSAN without adopting additional bundles. In practice, this could mean inserting language such as: “Customer retains the option to license vSphere and vSAN outside of a full Cloud Foundation stack, with no requirement to purchase unused components.” Essentially, you want it clear that you’re not implicitly agreeing to buy, say, NSX or other software in the future just because you’re a vSAN customer. Keep the conversation and the contract focused on the products you actually intend to use. If you smell any attempt to include extra components (“We’ll give you a great deal if you take VCF…”), weigh that carefully and negotiate an opt-out or a price adjustment for any pieces you won’t use. It’s better to negotiate a separate line-item price for vSphere+vSAN even within a bundle, so you know what that portion costs. That way, if later Broadcom tries to say “you need to renew the whole Cloud Foundation,” you can counter that you only want to renew the parts you use at the prices previously established.
- Insist on Clear Scope and True-Down Rights: In some cases, you might actually reduce your usage (for example, decommissioning a cluster). While vendors don’t usually volunteer to give money back for reduced usage, you can try to negotiate true-down rights or at least the flexibility to adjust counts at renewal without penalty. At a minimum, ensure the contract states that your price and terms apply up to the licensed quantities – not that you are obligated to maintain those quantities. If you start with 100 licenses and later only need 90, you should be able to renew just 90. This is more of a renewal strategy, but planting the seed now can prevent arguments later. Also, be sure there’s no contractual language forcing you to pay for a minimum number if your needs decrease. Keep it tied to actual usage.
Throughout these negotiations, keep a skeptical, procurement-focused mindset. Broadcom’s initial proposals might include conditions or assumptions that are not in your favor (e.g., all hosts must be licensed for vSAN, or pricing that jumps in year 2).
It’s your job to identify those and counterpropose fair terms. Don’t hesitate to ask for each commitment in writing. Verbal assurances like “Oh, we’ll take care of you on extra capacity” mean little unless the contract reflects it. Utilize the leverage of the combined deal to negotiate written clauses.
Some sample contract clauses you might use in your negotiation include:
- Locked Expansion Price: “Customer may expand vSAN capacity (or add vSphere/vSAN licenses) at the same per-CPU/core license price for the full contract term.” (This ensures price consistency for growth.)
- Selective Deployment: “Customer is not required to license vSAN for servers or clusters where vSAN is not actively deployed.” (This ensures you don’t pay for non-use.)
- Bundle Discount: “The combined purchase of vSphere and vSAN shall reflect a portfolio discount of not less than X% off prevailing list prices.” (This guarantees a certain discount level for bundling; you would fill in a number based on what you negotiate.)
By bringing up specific terms like these, you show the vendor that you are a savvy negotiator and that you won’t accept vague promises. Broadcom’s team will realize that to close the deal, they need to meet these clearly stated conditions or risk the deal stalling.
Leverage Points – Using Alternatives and Competition as Pressure
Negotiation is not just about what’s in your current VMware portfolio; it’s also about outside alternatives.
Broadcom needs to know that you have options (even if, realistically, switching away might be a complex process). Using competitive leverage can significantly strengthen your position:
- Highlight Alternative Solutions (Software-Defined Storage): Make it clear that if the vSAN proposal isn’t satisfactory, you can consider other storage solutions. One powerful card is mentioning open-source Ceph. Ceph is a distributed storage platform that some enterprises use as an alternative to vSAN for managing storage on commodity servers. While adopting Ceph has its own complexities, the key is to remind Broadcom that vSAN is not your only route for software-defined storage. Similarly, you could look at other software-defined storage (SDS) options or continue relying on traditional storage arrays. The mere fact that you’re evaluating options puts pressure on Broadcom to sweeten the deal so as not to lose the vSAN portion of your business.
- Introduce Nutanix or Hyper-Converged Competitors: Nutanix is a well-known competitor in the hyper-converged infrastructure space, offering its own blend of compute and storage software. If appropriate, mention that Nutanix or other HCI platforms are on your radar. Even if you plan to stick with VMware, letting Broadcom know that you’re willing to pilot a Nutanix solution or similar can be a powerful negotiating chip. It signals that you’ll walk away from an overpriced vSAN + vSphere deal if needed. Broadcom’s worst fear is losing a customer to a rival platform entirely, so this leverage can make them more flexible. They might counter by emphasizing the integration of vSAN with vSphere (which is true – staying with VMware has benefits), but the point is they’ll realize you’re not blindly locked in.
- Use Cloud or External Storage as a Backup Plan: Although not directly comparable to vSAN, some organizations consider offloading certain workloads to the cloud or utilizing cloud-based storage when on-premises costs become too high. If applicable to your situation, you can subtly hint that if on-prem VMware costs escalate, you have cloud alternatives or could invest more in public cloud services instead of expanding vSphere/vSAN on-prem. This can be abstract leverage, but it contributes to the message that your budget can go elsewhere.
- Leverage Existing Investments: If you have existing investments in storage hardware or other virtualization tech, bring those into the conversation. For example, “We still have X years left on our expensive SAN infrastructure, so if vSAN isn’t commercially viable for us, we’ll just maximize our use of that SAN instead.” Or, “We already have a Nutanix cluster in a remote office; expanding that is an option if we can’t reach a good agreement here.” These statements remind Broadcom that parts of your environment may need to move away from VMware if necessary. It’s especially effective in a multi-vendor environment, as you can cite real examples (e.g., a department already using Hyper-V or a similar solution) to make the threat more credible.
The key with leverage points is to be prepared to back them up if pushed. Broadcom might call your bluff by asking, “Are you seriously considering moving to Nutanix or Ceph?” You should have a reasoned response – perhaps that you are conducting due diligence and cost comparisons, as any prudent organization would.
You don’t necessarily have to actually be on the brink of switching, but you want them to think you could. This will make Broadcom more eager to close the deal on terms favorable to you, rather than risk a loss.
In negotiations, knowledge is power: demonstrating that you know the competitive landscape and your own alternatives reduces the vendor’s power. They cannot assume you’ll accept whatever they offer – you have Plan B and C in your pocket.
Checklist – Must-Have Terms in vSphere + vSAN Deals
To ensure you cover all bases, use this checklist of must-have terms when structuring your vSphere + vSAN negotiation.
These are clauses or conditions you should strive to include in your agreement with Broadcom:
- ✅ Bundle Discount: Ensure the contract provides a portfolio discount for the combined vSphere and vSAN purchase. You should see a line item or an overall percentage off that reflects the fact that you’re buying two core products together. (For example, “30% discount off list on the bundled package” – the number will depend on your deal, but get it explicitly stated.) This prevents Broadcom from quietly charging you the full rate on each; it locks in the negotiated savings.
- ✅ Locked Expansion Pricing: Include a clause that locks the unit pricing for additional licenses or capacity for the term of the agreement. This means that if you need more vSphere core licenses or additional vSAN capacity next year, you will pay the same unit rate as in the initial purchase. Without this, you could face much higher rates later. Obtaining this term provides cost certainty for scaling up. (E.g., “Additional vSphere/vSAN licenses purchased during the contract term will be priced at the same per-core and per-TB rates as the initial purchase.”)
- ✅ Selective Deployment Rights: It should be clearly stated that you are not obligated to license every server for vSAN. You want the freedom to choose which hosts or clusters run vSAN. In contract language, this might be described as, “Customer may deploy vSAN on a subset of licensed vSphere hosts at its discretion, with no requirement to license hosts on which vSAN is not used.” This ensures you won’t be found non-compliant for not having vSAN on a particular item, and you won’t pay for something you’re not using. It’s essentially a flexibility guarantee.
- ✅ Renewal Cap: Protect yourself from runaway costs by implementing a cap on renewal price increases. For instance, a clause could stipulate that any renewal (after the initial term) will not exceed a certain percentage increase (e.g., “not to exceed 5% increase in fees year-over-year”). Alternatively, if you sign a multi-year deal now, ensure it includes a clause stating no price increase during that term. This way, you know what the maximum future cost will be, and Broadcom can’t surprise you with a huge uptick at renewal time. This term is critical given Broadcom’s history of price hikes; it legally limits their ability to do so.
- ✅ Standalone Component Clarity (if applicable): (This one ties to the Cloud Foundation issue.) If your deal is part of a larger bundle, have it documented which components you are actually paying for and using. For example, if the SKU is Cloud Foundation but you’re only using the vSphere/vSAN portion, the contract should note that and possibly list the other components as $0 or optional. While not always straightforward, try to get written assurance that unused components don’t have to be renewed if you don’t use them. This isn’t exactly a clause you check off like the above, but a negotiation outcome: clarity that you can renew just what you need. It saves you from being forced to renew an entire suite unnecessarily.
Before signing anything, review this checklist to ensure each point is addressed. If something is missing, go back to Broadcom and negotiate it in.
It’s much harder to add these protections later, so it’s worth the extra time now to get the contract right. Remember, a well-structured deal will save you headaches (and dollars) in the long run.
FAQs – Common Questions About vSphere/vSAN Negotiations
Q: Is vSAN still sold standalone under Broadcom?
A: In the current Broadcom licensing paradigm, vSAN is generally not sold as a standalone traditional license, the way it was in the past. Instead, vSAN comes bundled with certain vSphere subscription offerings. For example, Broadcom’s VMware Cloud Foundation and vSphere Foundation editions include vSAN as part of the package. While you do get a separate license key for vSAN features (for technical activation), you typically don’t negotiate vSAN separately from vSphere in a large enterprise deal – it’s one combined subscription. If you only want vSAN without the full bundle, your option would be to purchase vSAN capacity add-ons (measured in terabytes) on top of a vSphere subscription that includes vSAN. So, effectively, you still need a vSphere-vSAN bundle to get started. Always verify with Broadcom whether a vSAN-only SKU exists for your scenario; however, it is most likely that they will direct you to a bundle. Plan to negotiate on the bundle pricing and included capacity, rather than trying to buy vSAN à la carte.
Q: Can I license vSAN for only part of my environment (e.g., some clusters and not others)?
A: Yes, absolutely – and you should insist on this flexibility in your contract. Technically, vSAN is enabled on a per-cluster basis within vSphere. You don’t have to run it on every cluster. The challenge is the way licensing is sold in bundles now; if you bought a bundle for all your cores, you might inadvertently have paid for vSAN on all of them. The solution is to scope your purchase to the part of the environment where you want vSAN. For instance, if you have 10 clusters but only 5 will use vSAN, you might negotiate a certain number of core licenses under a vSphere+vSAN bundle sufficient for those 5 clusters, and license the other 5 clusters with a vSphere-only edition (if mixing editions is allowed– a point to confirm). Another approach is to buy the vSAN-inclusive licenses for all, but at a lower quantity or capacity tier, and explicitly document which clusters are initially covered. The key is to make it contractually clear that you are not obligated to expand vSAN beyond the agreed-upon scope. During negotiations, clearly communicate your intended deployment scope to Broadcom and ensure the pricing accurately reflects this limited scope. You can always expand later (preferably at locked-in rates, as discussed), but you shouldn’t be paying day one for clusters that have no plans to use vSAN. In summary, you can license vSAN for only part of your environment – simply negotiate the deal to reflect this plan and obtain terms that allow for partial deployment without penalty.
Q: How do I negotiate bundle discounts for vSphere and vSAN?
A: Negotiating bundle discounts is all about positioning your purchase as a win-win for both you and the vendor. Here’s how to approach it:
- Do your homework: First, get a sense of typical discounts. Broadcom might not openly share this, but you can infer from past VMware deals or industry chatter (some enterprises report needing 20-30% off or more to make the new pricing palatable). Have an internal target for the discount you need on the combined deal.
- Make it one negotiation: Tell Broadcom you are considering the total package. For example, instead of saying “We’re renewing vSphere, and maybe later we’ll add vSAN,” say “We intend to renew vSphere and adopt vSAN, but it all hinges on getting a viable commercial offer.” This signals that the entire deal could be won or lost for them, which motivates them to offer a better price.
- Leverage volume: Emphasize the number of licenses or the extent of expansion this bundle represents. If adding vSAN means an incremental spend of, say, hundreds of thousands of dollars, point that out: “We’re committing this additional budget to VMware by doing vSAN – we expect a corresponding commitment from your side in terms of discount.” Vendors respond when they see that they might lose that additional opportunity.
- Ask explicitly for a bundle or portfolio discount: Use those terms. For instance, “What bundle discount can you provide for taking both products?” or “We need a combined discount of at least X% on the whole package to proceed.” Sometimes the quote will already show some discount, but don’t assume it’s their best. You can counter with, “This bundle price is still higher than our budget – we need you to sharpen the pencil. Perhaps throw in an extra x% ‘portfolio discount’ for the multi-product commitment.”
- Get it in writing: Once agreed, ensure the final quote or order form clearly states the discount. It could be a single line stating “Applied bundle discount” or simply reflected in the unit prices after discount. Clarity prevents any confusion later about what was promised.
In essence, be candid about your expectation of a better deal for buying more. Broadcom’s sales team has targets and incentives across the product portfolio, so if you’re helping them hit multiple product targets (vSphere quota, vSAN quota), they have reason to give you a sweeter deal.
Just ensure the result is documented and truly a cost-saving measure for you, not a bundle that is still overpriced for your needs.
Read about the VMware core licensing changes, Broadcom’s Core Licensing for VMware vSphere – What Customers Need to Know.
5 Actionable Tips for Negotiating vSphere + vSAN Deals
To wrap up, here are five actionable tips you can apply immediately when negotiating your VMware vSphere and vSAN deal with Broadcom:
- Always Negotiate vSphere and vSAN Together: Treat vSphere (compute) and vSAN (storage) as a package in negotiations for maximum leverage. By combining them in one deal (and even incorporating other VMware products if necessary), you create a larger contract that Broadcom will fight harder to win, thereby increasing your chances of securing a significant discount.
- Avoid Mandatory “All-or-Nothing” Adoption: Do not let Broadcom force you into licensing vSAN on hardware where you won’t use it. Be firm that you will only purchase licenses for the hosts/clusters where vSAN is deployed. This avoids paying for shelfware. If a proposal assumes 100% adoption, push back and scale it to your actual plan – you can always grow later once value is proven.
- Lock In Expansion Pricing Upfront: Future-proof your deal. Negotiate a clause now that says any additional vSphere cores or vSAN capacity you add later will be at the same price (or the same discount level) you’re getting today. This protects you from price hikes when you need to expand your environment next year or the year after. It essentially “freezes” today’s negotiated rate for the term of the contract, giving you cost predictability.
- Secure Bundle Discounts and Cap Increases: Use the fact that you’re buying a bundle to demand a better price and capped renewals. Ensure you get a healthy bundle discount off the list price for the combined purchase. Additionally, cap any annual renewal increase (e.g., no more than a 5% bump) so that you’re not hit with an exorbitant price jump later. This helps keep both initial and long-term costs under control.
- Leverage Alternatives as Bargaining Chips: Ensure Broadcom understands that you have other options if the deal isn’t right. Consider evaluating alternative solutions, such as open-source Ceph (for storage) or Nutanix (for HCI), as a fallback. Even if switching is a last resort, signaling that you’re willing to consider it puts useful pressure on the vendor. Broadcom will be more inclined to meet your terms if they realize you’re not afraid to explore non-VMware avenues to meet your IT needs.
By following these tips and the strategies outlined above, you’ll approach your vSphere and vSAN negotiations with confidence and a plan.
The Broadcom era of VMware licensing may be challenging. Still, with a savvy, well-prepared negotiation stance, you can achieve a deal that delivers the virtualization capabilities your organization needs without breaking the budget or sacrificing flexibility.
Good luck, and remember that everything is negotiable if you come to the table informed and firm on what you need!
Read more about our VMware & Broadcom Licensing Consulting Services.
