VMware moving to per-core licensing

VMware has changed its license model from per-CPU to per-core licensing. What is VMware's new license mode? When does it go into effect?

Recently, major news in the realm of VMware licensing was announced. VMware is changing their licensing model from the current one CPU license per physical CPU to a per-core model. This represents a major shift in the way VMware is selling licensing for ESXi hypervisor hosts. What does the new licensing model involve? How will licensing be sold under the new licensing model? When does it go into effect?

VMware's current license model ^

As most IT admins are aware, VMware licensing has been the same for years now. Licensing is sold per physical CPU package, which is installed in the physical ESXi hypervisor host. This means licensing is very straightforward. If you have one CPU, you will license one CPU from VMware; two physical CPUs equals two VMware CPU licenses. This has long been an easy one-for-one approach to determine the number of VMware licenses you will need to purchase.

New VMware per-core license model ^

The writing has been on the wall across the industry for quite some time now, with ultra-dense CPUs being delivered with many cores (such as AMD's 64-core EPYC Rome). Many software vendors have been moving to a per-core license instead of a per-CPU license.

On February 3, 2020, VMware announced that their traditional per-CPU licensing model will be replaced by a per-core model as of April 2, 2020. How will pricing be calculated thereafter? On April 2, 2020, VMware will start charging a one-CPU license per 32 cores.

These are real CPU cores and do not include hyperthreads that may be included with each CPU/core package. In the screenshot below, you see an ESXi host with Intel Xeon Gold 6132 Processors. The host has two 6132s installed. Each processor contains 14 cores and 28 threads. With two installed, there is a total of 56 threads. The logical processors do not count as part of the new 32-core license that will go into effect. We will see below how to find the core count that does apply toward the new per-core licensing.

New VMware licensing does not count logical processors

New VMware licensing does not count logical processors

VMware has released an infographic that helps to visually explain the difference between the current CPU licensing and the licensing model that will be implemented on April 2, 2020. As you can see below, only those physical CPUs containing more than 32 cores will be affected by the licensing change.

VMware CPU licensing before and after the change coming in April 2020 (Image credit: VMware.com)

VMware CPU licensing before and after the change coming in April 2020 (Image credit: VMware.com)

Grace period after the license change takes effect ^

As part of the announcement, VMware is offering a grace period that will allow current customers who purchase new servers with more than 32 cores to take advantage of free licenses for the additional per-CPU licenses. The grace period extends from April 2, 2020 until April 30, 2020.

What do you have to do to qualify for the free licenses for processors with more than 32 cores? VMware has outlined the following requirements to take advantage of the free licenses:

  • For servers to qualify for free licenses to cover the additional "over 32-core" count, both the servers and VMware licensing must be purchased before 11 p.m. PST on April 30, 2020.
  • Proof of the server purchase must be submitted, and the request for the free licenses must be turned in by January 29, 2021.
  • You must have an active VMware support contract.
  • You will have to pay for support on the free VMware licenses that are received.

How the new VMware licensing affects customers ^

VMware has mentioned that the new licensing model does not affect the majority of its customers, as most customers run CPUs with fewer than 32 cores per CPU. However, it is likely that this is primarily because enterprise CPUs are only now getting to the point of the "32 and over" core count in many configurations.

It will be interesting to see how the VMware license change plays out among customers and how they plan to offset the additional cost of VMware licensing, which will effectively double what they are currently paying for dense core CPUs. There are a few strategies that many customers may employ, including:

  • Faster refresh interval – To take advantage of the "free licensing" being offered before April 30, 2020, businesses may opt to refresh a few months earlier than expected to obtain the free licenses.
  • Delayed refresh interval – Some customers may choose to delay a refresh interval, if possible, due to the extra licensing costs they may face with a hardware refresh if their refresh cycle is still a year or more out.
  • Scaling out VMware host deployments – For many customers, new VMware deployments may come down to choosing lower CPU core count processors and simply scaling out the deployment of ESXi cluster hosts. However, organizations will most likely have to weigh out the cost of extra licensing vs. the hardware costs of additional servers.
  • Migration to different hypervisor – It will be interesting to see how the licensing change will affect VMware's customer base. Will customers decide to abandon VMware in favor of a different virtualization platform?

There is even talk about how new CPU sales from Intel and AMD will be affected by the new licensing model introduced by VMware. It certainly makes these dense-core-count CPUs less attractive for virtualization purposes in the realm of VMware. It will be interesting to see how the introduction of new CPUs with dense core counts will mix with the announcement and change in VMware licensing.

Determining how many VMware CPU licenses you will need ^

VMware has released a new knowledge base article to go along with the announcement of the new per-core licensing model. The KB article is entitled Counting CPU licenses needed under new VMware licensing policy (77098). One method to determine the number of VMware CPU licenses you will need to purchase is to look under Host > Status > Hardware > Cores per Socket.

Cores per Socket is the number that will need to be licensed under the new license model, as shown below.

Finding the Cores per Socket value to determine per core licensing needed

Finding the Cores per Socket value to determine per core licensing needed

The KB also lists a downloadable PowerShell script that allows running the license check at scale against entire clusters to determine the core count and licensing that will be needed after April 2, 2020.

Conclusion ^

VMware's move to per-core licensing represents a major shift in the virtualization world moving forward. VMware is aligning itself more with the industry as a whole in adopting the per-core license model.

Organizations will need to account for the additional VMware license cost for the extra cores in their bills of materials when opting for dense-core-count CPUs in upcoming hardware refreshes in 2020. Businesses can take advantage of the grace period that VMware is offering up to April 30, 2020, and receive free licenses for any number of cores over 32 in a single CPU. This may no doubt move up refresh cycles planned for this year, as many will want to take advantage of the free licensing before the deadline.

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4 Comments
  1. Tom 10 months ago

    What if you use 2 CPU 16 core each. Will you need 1 license (32 core in total)? Or two?

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  2. Drew 10 months ago

    2x16=32 cores=1 license

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    • Dan 10 months ago

      I don't think that is correct, if you have 2 cpu, you will still need at least 2 cpu licenses, this only has an impact if you have the high capacity cpu's

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  3. Jay Liang 9 months ago

    Does this new change apply to vSphere Essentials?

    0

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