VMware Licensing Changes Under Broadcom: vSphere, vSAN, NSX & More

VMware Licensing Changes Under Broadcom

Broadcom’s acquisition of VMware has brought sweeping changes to how VMware’s core infrastructure software is licensed.

Procurement leaders, IT administrators, and license managers are now grappling with a new reality: subscription-only licenses, retired products, and bundled “solutions” that replace the flexibility of the past.

Below, we break down the key changes for vSphere, vSAN, NSX, and more – and guide how to respond strategically.

Every paragraph is kept concise, and we use bullet points, tables, and checklists to help you quickly scan the highlights and action items.

Shift to Subscription-Only Licensing Across VMware

Broadcom has moved VMware to a 100% subscription model. Perpetual (one-time purchase) licenses are no longer sold for VMware’s data center products.

Instead of buying a license once and paying annual support, customers must now “rent” software via term subscriptions (typically 1–5 years):

• No New Perpetual Sales: Effective early 2024, VMware ceased selling perpetual licenses for vSphere, vSAN, NSX, and other products. Even the free vSphere Hypervisor edition has been discontinued. All new deployments require a paid subscription license.
• Ongoing Payments (OPEX over CAPEX): This shift turns VMware spending into an operational expense. Budgets must account for recurring fees rather than one-off capital purchases. Expect higher long-term costs in many cases, as subscriptions over years can total more than a previous perpetual + support model.
• Broadcom’s Rationale: Broadcom is driving this change to boost revenue and “lock in” customers. Subscriptions provide predictable, recurring income. Broadcom has publicly aimed to roughly double VMware’s revenue in a few years – a goal largely to be met by pushing subscriptions. Customers should view the new model as vendor-driven, not necessarily customer-friendly.

Elimination of Perpetual License Renewals

Not only are new perpetual licenses off the table, but Broadcom is also ending renewals of support on existing perpetual licenses:

• Support Contracts Not Renewed: If you own VMware perpetual licenses and your support (SnS) contract expires, Broadcom will not let you renew it. In other words, when your current support term is up, you can’t just extend maintenance on your perpetual licenses as before.
• “Trade-In” to Subscription: Broadcom’s approach is to offer a trade-in or migration program. They will propose that you convert your old perpetual licenses into a subscription for the new equivalent product. They may offer limited incentives (e.g., a discount on the first subscription term) to encourage this, but be prepared: even with discounts, many organizations have found that the subscription costs are significantly higher than their old maintenance fees.
• Using Perpetual Without Support: You are allowed to continue running your existing VMware perpetual licenses indefinitely (that’s the nature of “perpetual”). However, without a support contract, you lose access to updates, patches, and official support. Broadcom has even restricted access to software download portals for lapsed contracts. Running critical infrastructure on out-of-support software is risky – security patches and technical help would require either moving to subscription or seeking third-party support.
• Third-Party Support Option: As a temporary strategy, some customers consider third-party support providers to service their VMware environments if they choose not to renew through Broadcom. This can extend the life of your perpetual licenses a bit longer while you decide on the next steps. Just note that no new features will be available, and Broadcom may still audit compliance if you expand usage.

Bundling and SKU Consolidation: Cloud Foundation & vSphere Foundation

Broadcom has dramatically simplified (or rather constrained) VMware’s product catalog.

Instead of a menu of individual VMware products and editions, the focus is now on bundled platforms:

• VMware Cloud Foundation (VCF): This is the flagship all-in-one bundle targeting enterprise customers. Cloud Foundation includes vSphere (compute virtualization), vSAN (storage virtualization), NSX (network virtualization), as well as the VMware management tools (now called Aria Suite) and SDDC Manager for automation. It’s a full Software-Defined Data Center in a single subscription. If you need a broad VMware stack with software-defined networking and storage, this is the bundle Broadcom wants to sell you.
• VMware vSphere Foundation (VVF): This is a new bundle aimed at mid-sized or basic needs. It includes vSphere, as well as some vSAN and Aria capabilities, but notably does not include NSX. vSphere Foundation gives you advanced virtualization features (like DRS, distributed switches) and integrated vSAN storage (with a limited amount of storage capacity per core included), along with tools like Aria Operations for monitoring. It’s meant as a “lighter” bundle for those who don’t require the full Cloud Foundation.
• Few Standalone Options: Broadcom has eliminated most standalone, à la carte products. For example, you can no longer buy a separate vRealize (Aria) Operations license or a standalone NSX license. Everything is now part of a bundle. VMware initially kept vSphere Standard edition (and, for a brief time, an Essentials Kit) for very small customers, but even those options are being phased out or restricted. Broadcom even reintroduced vSphere Enterprise Plus as a standalone hypervisor license for advanced features – but without vSAN or NSX – mainly to appease some customers who didn’t want full bundles. Generally, any feature beyond basic hypervisor functionality will require you to choose either vSphere Foundation or Cloud Foundation.
• Impact of Bundling: The idea is to simplify sales and ensure customers get a “complete solution.” In practice, many organizations now must buy more than they need. For instance, if previously you only used vSphere and vSAN, now the default offer is Cloud Foundation (which forces you to take NSX and Aria too). This can raise costs significantly. Procurement should be prepared for bundle-based quotes and be ready to push back if components aren’t needed.

vSphere Licensing Changes (Per-Core Model and Editions)

VMware vSphere is the core hypervisor, and it has some of the most significant licensing changes under Broadcom’s regime.

These include a new per-core metric, minimum core counts, and edition streamlining:

• Per-Core Licensing (No Longer Per-Socket): Traditionally, vSphere was licensed per physical CPU/socket, with one license covering up to a certain number of cores (previously 32). Broadcom has now switched vSphere to a per-CPU-core licensing model. Every core on a processor now counts toward the licenses you need. This change means organizations with high-core-count CPUs (common in modern servers) will need more licenses than before. It ties licensing costs more directly to hardware specs.
• 16-Core Minimum per CPU: Under the new model, each physical processor is counted as having at least 16 cores, regardless of the actual number of cores. For example, a 12-core CPU is treated as 16 cores for licensing purposes. Even a small 8-core server will require 16 core licenses. This effectively imposes a floor, preventing discounts for low-core CPUs – a cost hit for small environments or edge use cases.
• (Withdrawn) 72-Core Minimum Purchase: Broadcom initially attempted to enforce a significantly higher minimum, requiring any new order to cover at least 72 cores’ worth of licenses. This policy (floated in early 2025) meant that even if you only needed licenses for, say, 20 cores, you would have to buy 72. After swift backlash from customers and partners – who pointed out this would punish small deployments and lab setups – Broadcom quietly retracted the 72-core minimum policy. As of now, the 16-core-per-CPU rule still applies, but there is no 72-core minimum order. Small and mid-market customers should remain vigilant: Broadcom may attempt other “minimum purchase” tactics in the future.
• Simplified vSphere Editions: VMware is consolidating its plethora of editions (Standard, Enterprise, Enterprise Plus, etc.) into a more streamlined set. Currently, vSphere Standard remains the basic offering (covering standard HA, vMotion, but no advanced features like DRS). For advanced needs, Broadcom’s primary path is the vSphere Foundation bundle (or reintroduced Enterprise Plus). Enterprise Plus (the classic top-tier hypervisor features) is available again as a standalone subscription, but notably it does not include vSAN or NSX – it’s compute-only. Broadcom’s goal is to funnel customers needing any software-defined storage or networking into the larger bundles (VVF or VCF). In summary: expect to choose between a bare-bones Standard vs. a “full stack” bundle; the middle-ground standalone options are limited.
• Cost Implications: The move to per-core licensing can increase costs, especially for servers with high core counts or for sites with a few small servers. For example, a dual-socket server with 64 cores total used to require perhaps 2 CPU licenses; now it requires 64-core licenses (4 times the amount, if comparing one license per 16 cores). Additionally, the 16-core floor means that remote offices or DR sites with only a few VMs on small hosts still incur a charge for 16 cores per CPU. When budgeting, organizations should analyze their hardware: in some cases, it might be worth standardizing on CPUs with 16 cores (to avoid waste above or below that count) or even consider reducing core counts if feasible. Do not assume old pricing models – recalculate based on the number of cores. Every quote from VMware should be scrutinized for the core counts they are charging. If you have lower utilization or smaller deployments, be prepared to negotiate special terms or explore alternatives, as the default model may result in over-licensing.

vSAN Licensing Changes (Storage Virtualization)

VMware vSAN (Virtual SAN) is VMware’s software-defined storage solution, previously licensed as an add-on.

Broadcom’s changes heavily impact how vSAN is packaged and sold:

• No More Standalone vSAN Licenses: Under the new scheme, you cannot buy vSAN separately as you did before. Previously, one could purchase vSAN per-CPU licenses for vSphere hosts that needed storage virtualization. Now, vSAN is bundled into the solution offerings – either included in Cloud Foundation or obtainable as an add-on to vSphere Foundation.
• Bundled or Add-On Only: If you opt for VMware Cloud Foundation, vSAN is a built-in component (with a large amount of storage capacity entitlement included as part of that bundle). For those who choose the smaller vSphere Foundation (VVF) bundle, vSAN is available as a subscription add-on licensed per TB of storage. In fact, Broadcom increased the baseline vSAN capacity included with vSphere Foundation to entice customers – currently, VVF includes about 0.25 TB of vSAN capacity per core licensed. This means that if you license 100 cores of vSphere Foundation, you receive approximately 25 TB of vSAN storage entitlement included. If you need more storage, you must buy additional vSAN capacity subscriptions.
• Per-Terabyte Licensing Option: The introduction of a capacity-based licensing metric for vSAN is notable. Instead of licensing by CPU, you can license vSAN by the amount of data stored. This might benefit organizations with very large clusters that aren’t fully populated with data, or conversely, those who have storage-heavy workloads on relatively few servers. However, pricing per TB may end up expensive; it’s designed mainly for cloud providers or specific use cases. Always compare the cost of per-TB vs per-core licensing for vSAN if Broadcom provides both options – choose the cheaper model for your usage profile.
• Avoiding Unnecessary Bundles: A significant concern for customers is being forced into Cloud Foundation solely to obtain vSAN. To avoid this, if you do not need NSX networking virtualization, you can opt for vSphere + vSAN only by using the vSphere Foundation bundle plus the vSAN add-on. This way, you pay for compute and storage but not for NSX. Be prepared to articulate this to VMware’s sales team – they will likely default to promoting Cloud Foundation (which includes NSX) as the “complete” solution. If NSX is truly not in your plans, insist on a vSphere Foundation quote with the vSAN TB add-on and no NSX, and compare the cost. You might save a considerable sum by eliminating the unnecessary NSX component. Additionally, consider alternatives: if Broadcom prices vSAN too high, some organizations may evaluate third-party storage solutions or hyperconverged alternatives to reduce their reliance on vSAN.

NSX Licensing Changes (Network Virtualization)

VMware NSX, the network virtualization and security platform, has undergone perhaps the most radical change: it’s no longer available on its own at all for most customers.

• NSX Only via Cloud Foundation: Broadcom has essentially folded NSX into the Cloud Foundation bundle. You can’t buy NSX as a standalone product for data center networking virtualization, as you could in the past. In the past, NSX was sold per CPU or per VM for those who wanted software-defined networking (e.g., micro-segmentation) in their vSphere environment. Now, if you need NSX, you’re going to be buying VMware Cloud Foundation, which includes vSphere, vSAN, NSX, and more together.
• “VMware Firewall” and Security Repackaging: Broadcom is also in the process of rebranding and repackaging NSX’s capabilities into its broader enterprise security portfolio. You may hear about a “VMware Network Security” or “VMware Firewall” offering from Broadcom, which integrates NSX features (such as a distributed firewall) with security services. Essentially, NSX is being treated less as a separate infrastructure component and more as part of a security solution bundle. This is relevant if your organization was using NSX mainly for security (micro-segmentation); Broadcom might try to sell you a security bundle instead of just “NSX licenses.”
• Cost and Flexibility Impact: The lack of a standalone NSX option results in a significant increase in cost for those who only want network virtualization. You can’t just layer NSX onto a vSphere cluster cheaply. You must now subscribe to the entire Cloud Foundation stack (including NSX), which is a significant subscription commitment. This reduces flexibility – you might have been interested in NSX for specific networks or projects, but now it’s an all-or-nothing proposition. Additionally, Cloud Foundation has a high entry point (in terms of license quantity and cost), so some mid-size organizations find themselves priced out of NSX functionality entirely.
• Using Alternatives as Leverage: If NSX’s new packaging is not palatable, consider alternative approaches to achieve similar outcomes. For network virtualization and micro-segmentation, alternatives include physical network solutions (like Cisco ACI or other SDN solutions) or open-source software-defined networking (for example, Open vSwitch/OVN with other virtualization platforms). Microsoft’s Hyper-V and Azure Stack also offer software-defined networking features, included in Windows Server/Azure licensing. While switching network virtualization platforms isn’t trivial, having a Plan B (even if just in pilots or concept) can strengthen your negotiating position with Broadcom. If Broadcom knows you have viable alternatives to NSX, they may be more willing to negotiate pricing or carve-outs. At a minimum, internally evaluate whether NSX is truly necessary; if not crucial, you could save millions by not purchasing a bundle that includes it.

Other Key Components (vCenter, Cloud Foundation, Aria Suite)

Beyond vSphere, vSAN, and NSX, Broadcom’s VMware overhaul touches other parts of the product line:

• vCenter Server: VMware vCenter (the management server for vSphere) remains essentially unchanged in licensing. Under the new model, vCenter is included as part of your subscription entitlement. You no longer need to buy a separate vCenter license for each instance; a subscription to vSphere (or a bundle) will grant you the rights to deploy vCenter servers as needed (typically one per site or cluster). In practical terms, vCenter is no longer a cost item – it’s bundled in. Ensure you’re licensed for all vSphere cores in the environment that vCenter will manage. Bottom line: no major worries here; vCenter licensing is straightforward and included.
• VMware Cloud Foundation as the Flagship: As noted, Cloud Foundation is now VMware’s flagship offering. Broadcom is focusing engineering and sales efforts on this full-stack solution. Cloud Foundation is designed to be a one-stop infrastructure cloud-in-a-box for customers, offering seamless integration between compute, storage, networking, and management. Buyers should be aware that Broadcom will heavily push Cloud Foundation as the default answer to most needs. Even if you approach them asking just for “vSphere,” expect them to start the conversation around Cloud Foundation if they think your company size or industry suggests you can afford it. Strategically, if you truly don’t need the whole thing, you need to be ready to justify a smaller solution. Conversely, if you do go with Cloud Foundation, ensure you leverage all its components for the price – use NSX for network automation, use Aria operations tools, etc., since you’re paying for them.
• Aria Suite (formerly vRealize Suite): VMware’s management and automation tools (vRealize Operations, Log Insight, vRealize Automation, etc.) were rebranded to Aria. Broadcom has discontinued Aria as a standalone suite. All those capabilities are now embedded in the bundles: vSphere Foundation includes some of them (like Aria Operations for monitoring and Aria Log Insight), and Cloud Foundation includes the full array (adding automation/orchestration tools). The stand-alone SaaS versions of these tools have also been put into end-of-sale. This means that if you used to pick and choose certain management tools, now you get whatever is bundled with them. For customers, a tip: since you’re likely paying for Aria Operations and others now as part of your bundle, consider retiring third-party tools that overlap with these services. For example, if you were using a separate monitoring product but now your VMware subscription comes with Aria Operations, you might consolidate on Aria to save costs elsewhere. However, suppose there’s an Aria component that you heavily rely on, which is not included unless you purchase the top-tier bundle. In that case, you’ll have to assess whether to pay more for Cloud Foundation or seek an alternative tool. Broadcom’s bundling might leave gaps for some (for instance, if you only want automation tools but not the rest – a tough scenario now).

(On VMware Horizon: VMware’s Horizon (VDI) products were sold off to a third party as part of Broadcom’s changes, so Horizon is no longer licensed by VMware/Broadcom. Horizon customers will deal with the new company, which means your EUC (End-User Computing) licensing will be separate going forward.)

Licensing and Support Considerations

With these licensing changes come new compliance and support challenges.

Broadcom’s style of license management is more rigid and aggressive than “old VMware,” so customers should be prepared:

• Compliance Risks with New Metrics: The shift to per-core and bundled metrics can create compliance pitfalls. If your team is unaware and continues to deploy new VMware hosts in the old way, you might inadvertently under-license them. For example, adding a new server with 2 CPUs / 48 cores requires updating your subscription count – there’s no “spare” socket license you can shuffle around anymore. Keeping track of core counts in use is critical. Additionally, mixing legacy perpetual deployments with new subscription deployments needs careful attention – you typically cannot mix old and new licensing in the same cluster without violating terms. Conduct a thorough internal audit of your VMware environment to ensure you have the proper subscriptions for every core and component you’re using.
• Subscription = Right to Use (Don’t Let It Lapse): Under perpetual licensing, if your support lapsed, you still had the right to run the software (albeit without support). Under subscriptions, if your term expires and you don’t renew, you lose the legal right to run the software at all. There is no “grace period” usage beyond the subscription term. This means lapses can threaten business continuity. Broadcom has also introduced a late renewal penalty – if you attempt to renew a subscription after it expires, they impose a hefty surcharge (often around 20% of the cost) as a penalty. The strategy is clearly to enforce timely renewal. Action: Track your VMware subscription renewal dates closely. Start the renewal process early. Missing a deadline could not only incur penalties but also potentially leave you unlicensed (and Broadcom could pressure you with that fact).
• Increased Audit Pressure: Broadcom is known for strict compliance enforcement. They have already signaled an uptick in VMware license audits. Customers should expect more frequent audits or review requests, especially around the time of renewals or if you decline to convert some systems to subscription. Be prepared: maintain documentation of your deployments and license counts to ensure accurate tracking. Ensure you’re not using features or products outside your entitlement (e.g., using vSAN or NSX on hosts that aren’t properly licensed via a bundle). Audits under Broadcom may be less forgiving, and given the high cost of non-compliance (list price subscriptions plus back maintenance, etc.), it’s better to self-identify and address any gaps before the vendor comes knocking.
• Support Changes and Penalties: With the transition to a subscription model, support is included at a standard level for all. Some customers have reported that VMware support quality has dipped post-Broadcom, with longer response times unless you’re a very large account. While there isn’t much you can change about their support organization, you should factor support promises into negotiations (for example, ensure premium support or local support is included if you need it). Also, note that if you stop subscribing, you not only lose the right to updates but also lose support entirely. There’s effectively a penalty for dropping subscription – you can’t restart without backpaying or buying new licenses at potentially higher prices. Broadcom’s hardball stance means they might not offer gentle reinstatements. The key is to avoid reaching that point by planning and budgeting for continuous subscription coverage, or having an alternative plan to migrate off VMware if you truly intend to discontinue maintenance.

Negotiation Strategies for VMware Licensing

In response to these changes, customers must adopt a proactive approach to negotiation. Broadcom’s default quotes may include unwanted products and higher costs, but you can negotiate to reduce these.

Here are strategies to consider:

• Grandfather Legacy Metrics: If you are a large or strategic customer, request protected terms for existing deployments from Broadcom. For example, consider grandfathering your current licensing metric for a specified period (“let us continue licensing by socket for 2 more years for existing servers”) or receiving credits for your existing investment. While Broadcom’s policy is subscription-only, they have made exceptions for some in the short term to facilitate a smooth transition. It never hurts to ask for an exception or special accommodation, especially if switching to the new model yields a shockingly higher price – show them the delta and request some relief.
• Cap Annual Uplifts: Negotiate limits on price increases for renewals to ensure stability. Broadcom subscriptions often jump in price at renewal if not contractually capped. Try to include a clause that caps yearly subscription price increases (e.g., a maximum of 3-5% per year or per renewal term). Multi-year agreements can help lock pricing, but even then, specify the cap on any increases after the term. This protects you from “sticker shock” in 1-3 years when Broadcom might otherwise hike rates significantly.
• Bundle Carve-Outs: Push to remove components you don’t need from a bundle, or to not be charged for them. For instance, if your organization has no plan to use NSX, make that clear and demand a pricing adjustment. Broadcom may not literally “unbundle” NSX from Cloud Foundation (the SKU remains the same), but they could provide extra discounting or some concession in recognition that you won’t use it. Similarly, if you already have a separate solution for log management and don’t want Aria Log Insight, mention it. The key is to avoid paying for shelfware. Carving out might also mean splitting a deal: e.g., only buying vSphere Foundation (without full VCF) for parts of your estate that don’t need NSX. Be willing to segment your purchase to avoid overspending on one-size-fits-all deals.
• Multi-Year Safeguards: Broadcom prefers multi-year commitments (3-year, 5-year prepaid subscriptions) and often offers a better discount for them. Leverage this to your advantage: in exchange for a longer term, negotiate not just a discount but also lock in favorable terms (like the uplift caps mentioned, or an option to adjust quantities mid-term without penalty). Also, ensure that if you trade in your perpetual licenses now, the multi-year subscription you receive in return has protections – for example, the ability to true-down if you decommission some servers, or a clause to swap to different VMware products if your strategy changes (such as cloud migration). A multi-year deal is a double-edged sword: it can secure pricing, but it also locks you in for the long term. So negotiate hard upfront since you won’t have leverage again for that term.
• Use Alternatives as Leverage: The strongest card you have is the possibility of moving away from VMware. Even if it’s not something you can do overnight, exploring alternative technologies can give you bargaining power. Obtain quotes from Microsoft for Hyper-V/System Center, or from Red Hat for their KVM-based solutions. Alternatively, consider whether moving some workloads to a public cloud (such as AWS/Azure) is feasible. If Broadcom senses that a customer might actually migrate off VMware (meaning they could lose the account entirely), they are more likely to be flexible on pricing and terms. We’ve seen some companies use a dual-vendor strategy – introducing a second hypervisor for specific use cases (such as development environments on KVM or remote offices on Hyper-V) – to contain the VMware footprint and send a message that they won’t accept unlimited price increases. Even if you stick with VMware, having a Plan B and letting Broadcom know you have one creates pressure for them to “earn” your continued business. In negotiations, mention your evaluations of other solutions and be prepared to back it up. At the end of the day, you may not switch, but any concessions you gain by threatening to do so are real.

Summary of Product Licensing: Legacy vs. Broadcom Era vs. Buyer Response

The table below summarizes how key VMware products were licensed before, what’s changed under Broadcom, and how customers should respond:

FAQs – Common Questions on VMware’s New Licensing

Q: Can we still purchase new VMware perpetual licenses or renew our old ones?
A: No. Broadcom has discontinued the sale of new perpetual licenses for VMware products, and it will not renew support on existing perpetual licenses once their contracts expire. All new licensing is through subscriptions. If you have an old perpetual license, you can continue using it, but when its support term expires, you’ll need to convert to a subscription (or forego support/updates).

Q: What happens to our existing VMware perpetual licenses now?
A: You still own any perpetual licenses you bought – they remain valid for the software version you have. You can continue to run your VMware environment with those licenses indefinitely. However, as mentioned, you won’t be able to get official support or upgrades on them beyond their current support period. Broadcom will offer to “trade-in” those perpetual licenses for subscription credits. If you choose not to convert, be prepared to run them without vendor support or seek third-party support. Also, over time, new VMware product versions will be unavailable to you (since those require subscription entitlement).

Q: How is vSphere licensing counted now? Are cores the only factor?
A: Yes, VMware vSphere is now licensed per CPU core. You need to license every core in your ESXi hosts. Additionally, VMware counts a minimum of 16 cores for each physical processor. So if a CPU has fewer than 16 cores, it still consumes 16 licenses. For CPUs with more cores, you count them all (e.g., a 32-core dual-socket server requires 64 licenses). VMware had proposed a rule requiring at least 72 cores in any purchase (effectively a large minimum order size), but that 72-core minimum policy was withdrawn after pushback. Currently, you can buy exactly the number of core subscriptions you need (with the per-CPU 16-core floor still in effect per CPU). Always double-check the number of cores VMware is quoting for you, especially if you have small hosts – make sure they’re not rounding up beyond the 16-core-per-CPU rule.

Q: Do we have to buy VMware Cloud Foundation to get features like vSAN or NSX?
A: Not necessarily. Broadcom’s sales will certainly tout Cloud Foundation as the comprehensive solution for any advanced needs, but there are other options in some cases. If you need vSAN (software-defined storage) but not NSX, you can subscribe to the vSphere Foundation bundle and add vSAN capacity to it – that way, you avoid paying for NSX. If you need NSX, unfortunately, the only real way to get it is via Cloud Foundation (since NSX isn’t sold standalone now). Another angle: if you only need some advanced vSphere features (like distributed switching or DRS) but neither vSAN nor NSX, you might use the Enterprise Plus vSphere edition (which gives those features without forcing storage/network add-ons). In summary, Cloud Foundation is required if you want the full VMware software-defined data center (compute + storage + network + cloud management). However, if your focus is narrower, consider discussing the vSphere Foundation bundle or standalone vSphere options with your VMware representative as a middle ground.

Q: Is vSAN now only sold by capacity (per TB)? How do we license storage?
A: VMware vSAN licensing has shifted away from per-CPU to either being included in bundles or licensed per TB. In the vSphere Foundation subscription, a certain amount of vSAN storage is included (linked to the number of cores you license). If you need more, you buy additional capacity licenses (e.g., in 1 TB increments). VMware Cloud Foundation includes a much larger allotment of vSAN capacity per core (since it’s geared to bigger deployments). You no longer buy vSAN per CPU socket. For your planning: estimate the amount of TB of vSAN storage you’ll use and ensure your VMware quote covers this. The per-core included capacity might or might not be sufficient. If your environment has very high storage needs relative to CPU (or vice versa), discuss with VMware the most cost-efficient way to address this – they can advise whether adding per-TB licenses or scaling cores is better.

Q: Can we still get NSX for our vSphere environment without the whole bundle?
A: At this time, no–NSX is essentially tied to Cloud Foundation. VMware isn’t selling NSX as an individual product like they used to. This means if you want to implement NSX for network virtualization or micro-segmentation in your data center, you’ll be opting into the Cloud Foundation subscription, which includes it (and a lot of other things). Some customers who only wanted NSX are understandably frustrated, as this increases cost and complexity. If you absolutely require NSX’s functionality, budget for Cloud Foundation. If you don’t, you might avoid Cloud Foundation and stick with simpler network solutions. One possible exception: Broadcom has talked about integrating NSX tech into a standalone security offering (a “VMware firewall” product). Depending on how it’s packaged, some NSX functionality may be accessible via a security appliance subscription. Details on this are still emerging, so please ask your VMware/Broadcom representative if this is an option.

Q: What is VMware Cloud Foundation in simple terms? Do we have to use it?
A: Cloud Foundation (VCF) is essentially VMware’s full data center-in-a-box offering. It bundles vSphere, vSAN, NSX, and the management tools into a single licensed product that can run your private cloud or hybrid cloud. Think of it as the VMware Cloud experience on-premises – it’s the whole stack of virtualization. You don’t have to use Cloud Foundation if it doesn’t fit your needs. Smaller environments may be sufficient with just vSphere (and possibly vSAN). However, Broadcom is emphasizing Cloud Foundation for enterprises because it ensures you’re using (and paying for) the complete suite. If you have a multi-rack, mission-critical environment and want software-defined everything, Cloud Foundation is likely the offering you’ll evaluate. If your environment is more modest, you can opt to push back and only take the necessary pieces (via vSphere Foundation or a similar solution). Cloud Foundation also requires specific hardware compatibility and design (since it uses VMware’s SDDC Manager), so it’s not something you turn on casually – it’s a strategic platform choice.

Q: How will these changes affect our VMware costs?
A: In many cases, costs will rise. Moving from a perpetual + support model to subscription means you’re paying continually, and Broadcom has generally set subscription pricing at levels that often exceed past annual support costs. Bundling can also inflate costs – you might be forced to pay for components that you previously skipped due to budget. Some organizations have reported extreme quotes (multiple times higher than their previous VMware renewals). That said, the exact impact depends on your situation: if you already use most of VMware’s suite and frequently refresh licenses, the change might be less pronounced. To manage costs: carefully assess what you’re being quoted for. Remove anything not needed. Negotiate for a reasonable discount – VMware used to offer significant discounts off the list price, and you should not assume the list price is fixed under Broadcom (they will negotiate, especially for larger deals). Also consider committing to a longer term for a bigger discount if you’re confident you’ll stay on VMware. And as discussed, keep alternative options in mind; showing that you’re cost-sensitive and willing to explore other platforms can motivate Broadcom to sharpen its pencil.

Q: What if we decide not to adopt these new VMware licensing terms?
A: You do have options, but each comes with trade-offs. One path is to stay on your existing VMware versions with perpetual licenses and not upgrade – essentially ride it out. You could use third-party support to get assistance without Broadcom, but you’ll eventually fall behind on technology. Another approach is to start migrating away from VMware to alternative solutions, such as shifting some workloads to public cloud services or utilizing alternative hypervisors (Hyper-V, KVM) for new projects, to gradually reduce VMware’s reliance. This can save licensing costs, but the migration effort is significant and may not be practical for all workloads in the short term. Do nothing and simply decline to renew VMware after your contracts end. You will be out of compliance and unable to continue using the software, which is not a viable long-term strategy (aside from the legal risk, lack of updates will also cause harm). The best approach for most is a balanced one: contain your VMware usage to what’s truly needed (don’t expand it if it’s not cost-justified), and plan for the possibility of a future without VMware by testing alternatives. You don’t have to rip out VMware immediately, but having a contingency (even if it’s just a pilot of an alternative or a plan to move some apps to SaaS/Cloud) will give you leverage and an exit strategy if Broadcom’s policies become unbearable.

Related articles

• Broadcom’s Core Licensing for VMware vSphere – What Customers Need to Know
• How to Negotiate vSAN and vSphere Together in Broadcom Deals
• NSX Licensing Under Broadcom – What Buyers Need to Know
• Broadcom’s New VMware Support Model: Changes, Risks, and Negotiation Strategies

Final Checklist: 5 Actionable Steps for VMware Customers

• 1. Inventory Your VMware Environment: Document all VMware products and versions you’re running, how many CPUs/cores, and what features (vSAN? NSX? etc.) you’re using. Note your support contract end dates. This baseline will identify the licenses you have and what’s at risk when Broadcom’s changes take effect. You can’t plan without knowing your current estate in detail.
• 2. Identify Needs vs. Nice-to-Haves: Determine which VMware components are truly required for your business and which are optional or underutilized. For example, are you truly utilizing NSX’s advanced features, or was it just a pilot? Do all clusters need vSAN, or can some use traditional storage? By identifying essential needs, you can avoid paying for unnecessary extras that you won’t use. Also consider whether some workloads could be run on more cost-effective alternatives (e.g., development environments on a different hypervisor).
• 3. Engage Broadcom (VMware) Early and Ask for Options: Don’t wait for your support to expire or a quote to arrive last-minute. Reach out to your VMware account representative or reseller well in advance of renewals. Ask them to explain the new bundles and get a preliminary quote. Use that to start a dialogue about concerns – for instance, “This bundle includes X and Y, which we don’t need – what can we do about that?” Early engagement gives you time to negotiate and explore adjustments. It also puts Broadcom on notice that you’re not a passive customer; you expect a tailored solution, not just the standard one.
• 4. Negotiate Contract Terms Rigorously: When it comes time to sign new agreements, scrutinize every line. Push for the price protections and flexibilities discussed above: cap on renewal increases, ability to true-up/true-down, and multi-year pricing locks. If you’re trading in perpetual licenses, ensure you get credit value for them. Everything is negotiable if you have leverage – that leverage might be your size of spend or the credible plan to shift spend elsewhere. Also, document any promises (for example, if sales says, “We’ll include an extra vCenter at no charge” or “We guarantee 24/7 support response times”), and get them in writing in the contract or order form. Once you sign, it’s hard to change terms, so fight for a fair deal now.
• 5. Develop a Long-Term Contingency Plan: Broadcom’s VMware may be less customer-friendly, so wise organizations create a Plan B. This could include investing in staff skills for alternative platforms (train your team on Hyper-V, KVM, or cloud orchestration), migrating a small pilot workload to an alternative to evaluate performance and cost, or maintaining the ability to revert to older VMware versions with third-party support if needed. The goal isn’t necessarily to leave VMware entirely, but to give yourself options. With a viable contingency, you won’t feel trapped into accepting any terms at renewal time. And if VMware does become too costly or restrictive in the future, you’ll be much better positioned to pivot without business disruption.

By taking these steps, you can better control the narrative despite Broadcom’s sweeping changes.

The key is to be proactive: understand the new licensing landscape, adjust your procurement strategy accordingly, and never be afraid to push back or walk away if the deal isn’t right.

VMware’s technology is important to many organizations, but that doesn’t mean you should pay any price or accept any conditions.

Stay informed, stay prepared, and you can navigate this licensing transition with your budget and infrastructure strategy intact.

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