VMware vSphere Compliance Best Practices
Introduction – The New Compliance Landscape Under Broadcom
The VMware vSphere compliance landscape has tightened under Broadcom’s ownership. Broadcom is far stricter than VMware was, with frequent audits now the norm.
If you drift out of compliance, you risk steep penalties, forced license purchases, or even cease-and-desist orders to stop using the software. Staying compliant with vSphere under Broadcom is a strategic necessity to avoid budget shocks and downtime.
Broadcom can audit without warning, and any gap between usage and entitlements can become a costly surprise. The takeaway: adopt a proactive and skeptical stance on VMware licensing, assuming an audit is forthcoming.
Read our complete guide to Preparing for VMware License Audits Under Broadcom: Risks, Traps & Defense.
Core vSphere Compliance Practices
Build your compliance foundation with these everyday best practices:
- Apply Valid Licenses: Ensure every ESXi host and vCenter has a proper license key applied (no running on the 60-day eval or an expired trial).
- Monitor Usage: Regularly check vCenter’s license usage against what you own. If you’re nearing your limits, plan a true-up to avoid accidentally exceeding them.
- License New Hosts ASAP: Never deploy new ESXi hosts without immediately assigning purchased licenses. Even a brief period without a license is a compliance risk.
- Separate License Editions: Don’t mix different vSphere edition licenses in one cluster. This prevents the accidental use of features that some hosts aren’t licensed for.
- Match Software to Entitlement: Only run ESXi versions that your licenses (and support contracts) entitle you to. If you upgrade to a new major version, ensure you have the rights to use it first.
- Reclaim Retired Licenses: Remove or reallocate licenses from any decommissioned hosts. Clean up old keys in vCenter to prevent them from being reused beyond your entitlement.
Make these practices part of standard IT procedure. For example, include a license check in every change plan that involves adding capacity or upgrading software. Good hygiene practices here prevent most compliance issues before they arise.
Read about audits for Aria, Navigating a VMware (vRealize/Aria) Suite Audit.
Compliance Traps to Avoid
Beware these common pitfalls that catch vSphere customers off guard:
- Using Unlicensed Features: Enabling Enterprise Plus–only features (such as DRS or distributed switches) on Standard Edition hosts will put you out of compliance.
- Capacity Creep: Adding a few extra CPU cores or an additional host without purchasing additional licenses can result in your entitlements being silently exceeded. Broadcom will catch any overage during an audit.
- Mixed Cluster Licensing: Mixing different vSphere editions in one cluster can result in unlicensed features being used, as cluster features require all hosts to be licensed at the highest edition present.
- Trial or NFR Keys in Production: Running production on evaluation or NFR (not-for-resale) licenses is a ticking time bomb – once those keys expire or report in, you’re clearly in violation.
- Unretired Old Licenses: Leaving old license keys active after decommissioning servers can lead to inadvertent overuse. Always remove retired keys to avoid accidentally exceeding your entitlements.
All of these traps are avoidable with foresight and strict policies. Educate your team so everyone knows to stay within the lines.
Self-Audit Playbook
Regular self-audits will catch compliance issues before Broadcom does. Use this checklist for your vSphere environment:
- Inventory Everything: List all ESXi hosts, their vSphere edition, number of CPUs (sockets/cores), and ESXi version. Note any cluster features enabled (HA, DRS, vSAN, etc.).
- List Your Licenses: Compile all purchased VMware licenses (editions and quantities) and their support status. Include add-ons like vSAN or NSX.
- Compare Usage vs. Entitlements: Check that the total hosts and CPUs in use do not exceed what you’ve purchased. Identify any over-deployment or unused license capacity.
- Check Feature Usage: Verify that no advanced feature (e.g., DRS, vSAN) is enabled without the appropriate license. Disable or correct any feature usage that exceeds your edition.
- Verify Version Eligibility: Ensure you’re not running a vSphere version for which you lack entitlement. (For example, don’t run vSphere 8.0 if your licenses only cover up to 7.0.)
- Remediate and Document: Address any gaps immediately. If you’re over-deployed, consider purchasing licenses or reducing usage; if features are unlicensed, disable them or acquire the necessary licenses. Document the fixes and keep a record of them with your license files as evidence of compliance.
Perform this self-audit at least quarterly. Treat it as an internal “pre-audit” to maintain control. By fixing problems proactively, you stay ahead of any vendor audit.
Operational Compliance Discipline
Make license compliance an ongoing habit in IT operations:
- Regular Review Cycles: Conduct a vSphere license review quarterly to catch drift early.
- Embed in Change Management: No new host or feature goes live without a license check. Every infrastructure change plan must verify licensing requirements.
- Assign Accountability: Designate specific individuals to oversee vSphere licensing (for example, IT operations tracks usage, and procurement ensures licenses are purchased).
- Continuous Monitoring: Use tools (vCenter reports or asset management software) to watch license usage continuously. Set alerts for any unlicensed deployment or overuse.
- Staff Awareness: Train admins to follow license rules. They should know not to add hardware or enable features without the proper licenses. A little awareness prevents a lot of issues.
- Keep Proof Handy: Maintain an organized repository of all VMware license documents (keys, contracts, support renewals, purchase records). Easy access to entitlements makes audits or vendor discussions smoother.
With these practices, compliance becomes an integral part of daily operations, rather than a scramble during audits.
Negotiation Levers to Reduce Risk
When negotiating VMware contracts under Broadcom, include clauses that protect you in case of compliance slip-ups:
| Negotiation Lever | How It Protects You |
|---|---|
| Grace Period for Overuse | Gives you 30–60 days to resolve any license overuse before it’s a breach, avoiding immediate penalties. |
| True-Forward Clause | If an audit finds a shortfall, you purchase the missing licenses going forward with no retroactive fines. |
| DR/Cluster Flexibility | Excludes passive failover or DR-only hosts and short-term usage bursts from license counts. Prevents being charged for hardware not actively running workloads. |
| Flexible Renewals | Lets you reduce or adjust license counts at renewal if your needs changed, so you don’t pay for unused licenses in long-term agreements. |
Tip: Push for these in writing. For example, “30 days to cure any license compliance issue” or “audit findings resolved by purchasing missing licenses, with no penalties for past use.” You might not get everything, but even one of these levers can save you a lot of pain later.
Scenarios & Examples
Real-world compliance hiccups and responses:
- New Hosts Without Licenses: A team added two ESXi hosts but forgot to buy licenses. After the eval period, vCenter flagged them as unlicensed. Fix: Immediately apply valid licenses (or remove those hosts that are not licensed). Enforce a policy that no new host is deployed without an accompanying license purchase.
- Upgraded vSphere Without Entitlement: Hosts were upgraded from vSphere 7 to 8, but support (and thus upgrade entitlement) had expired. Fix: Pause further upgrades and obtain the proper licenses or support reinstatement for version 8. In the future, verify you have upgrade rights before installing a major version.
Each scenario shows why vigilance is key. The sooner you catch and correct a compliance issue, the better off you’ll be if Broadcom audits you.
Governance Model for Ongoing Compliance
Establish a simple governance structure to sustain compliance:
- Checklist & Reporting: Maintain a VMware deployment checklist that includes licensing steps (e.g., “License purchased and assigned”) and use it for every new host or feature. Also, produce a brief usage-vs-entitlement report on a regular schedule (e.g., quarterly) and keep it on file to demonstrate proactive compliance.
- Continuous Improvement: If a compliance slip occurs, treat it as a learning opportunity. Update your checklist or processes to prevent it from happening again. Over time, your controls will only get stronger.
By formalizing compliance in this way, you ensure it’s not a one-time project but a continuous effort. Your organization will be ready for audits at any time.
FAQs
Q: How often should we self-audit our vSphere environment for compliance?
A: Do an internal license audit at least quarterly. If things change fast, consider auditing monthly. The goal is to catch and fix issues before any official audit.
Q: What if we discover we’ve exceeded our vSphere license entitlements?
A: Act immediately. Purchase any additional licenses needed or reduce usage to get back within your licensed limits. There is no need to inform Broadcom if you fix the issue quickly, but please document the incident internally.
Q: Will Broadcom give us a grace period to fix issues if an audit finds non-compliance?
A: Not unless it’s written in your contract. Without a negotiated grace period, Broadcom typically expects an immediate true-up and may charge support fees that are backdated. It’s best to negotiate a 30–60-day cure period in your agreement for a safety buffer.
Q: Can we negotiate a “no penalty” (true-forward) policy for license audits?
A: You can certainly try. Some customers have secured contract language that any compliance gap will be resolved by purchasing the needed licenses going forward, with no retroactive penalties. Broadcom may not agree, but if you’re a large customer or have a strong compliance record, you have a better chance. It’s worth raising during negotiations.
Read about our Broadcom Audit Defense Service.
