VMware distributor Arrow says minimum software subs set to jump from 16 to 72 cores

Claims Broadcom will levy 20 percent penalty for customers who don’t pay before renewal deadlines

The French limb of global tech distributor Arrow has emailed VMware partners it serves with news of big price increases.

In an email seen by The Register, Arrow explains that as of April 10th “the minimum number of cores required for VMware licenses will increase substantially, from 16 to 72 cores per command line.”

We've preserved a screenshot of the message but won’t link to as its URL includes tracking codes that identify the recipient.

The email goes on to explain that the impact of the change means that a customer with a server that packs a single eight-core processor will need to pay for 72 cores – meaning they would be paying for 64 cores worth of software they cannot use.

The email also warns that Broadcom “has introduced penalties for end customers who have not renewed their subscription licenses (already in place) on the anniversary date.”

Those penalties will mean a 20 increase over the quoted price of the first year of a renewed subscription.

The Register has seen several social media and blog posts that mention these changes and last week asked VMware to confirm them but did not receive a response. We asked again on Thursday, again without result.

We therefore need to speculate about why this is happening, and to which customers.

The second question is easier to answer, as orgs with eight cores are likely to use the vSphere Foundation and vSphere Enterprise Plus products that offer basic server virtualization tools.

VMware’s current hero product is the Cloud Foundation (VCF) bundle of compute, storage, and network virtualization tools that build into a private cloud. It can run on just four servers, but the nature of the beast means users will likely need 72 or more cores.

This licensing change therefore appears to be a signal that VMware intends to raise costs for its smaller customers, a tactic its owner Broadcom has previously said it favours so it can concentrate on the needs of larger customers that provide it with most revenue.

There’s the why: Broadcom prefers to work with large and lucrative customers.

Do you know more? The Register is interested to hear from VMware users navigating the changes brought by Broadcom. Contact us here in confidence.

Larger VMware customers have also seen costs rise as Broadcom consolidated Virtzilla’s sprawling product portfolio into bundles and sold them under subscriptions that include support services. While the notional price of products in those bundles fell, the requirement to buy bundles and service meant most users saw costs increase.

The Register continues to hear about some orgs who feel Broadcom’s changes saw costs rise to levels at which they feel they must migrate to an alternative platform, Broadcom’s results suggest it has increased revenue and profit produced by VMware products – and the company has often declared itself very pleased with efforts to re-shape VMware and integrate it into its infrastructure software business unit. ®