Most people arrive at this question the same way. The renewal quote lands, the number is unrecognizable next to last year's line item, and the explanation from the seller is some version of "licensing changed." That is true, but it is not useful. It does not tell you whether the number in front of you is the new market rate for what you run, or a quote built on assumptions about your environment that are simply wrong.
This page separates those two things. Below is the mechanical breakdown of what changed after Broadcom's acquisition, how each change affects the number, and how to work out which ones are actually driving yours. For the corporate and product history behind it, see what happened to VMware. For the licensing detail, including the core-count math, see the licensing changes guide.
Who this page is for
You have a renewal quote in hand, or you know one is coming, and you want to understand the number before you react to it. You are not yet deciding whether to stay on VMware or move; you are trying to establish what is real. If you have already accepted the number as accurate and want the list of what can move it, go straight to renewal cost reduction. If you want a line-by-line method for reading the quote itself, start with the renewal quote review.
The four changes behind the number
These are independent of each other. An estate can be hit by one of them or by all four, which is why reported outcomes vary so widely between organizations that look similar on paper.
| What changed | What it does to your number | Who feels it hardest |
|---|---|---|
| Perpetual and SnS ended Announced December 11, 2023 |
You were paying roughly 20 to 25 percent of a sunk license cost each year for support. You now pay a subscription price for the software itself. The comparison is not a price increase on the same thing; it is a different thing being billed. | Anyone whose prior line item was SnS on perpetual licenses bought years ago, especially at a heavily discounted original purchase price. |
| SKU consolidation into bundles | Thousands of SKUs became a small number of per-core bundles. If you ran vSphere on its own, you may now be quoted VMware Cloud Foundation, which carries roughly 2.5 times the per-core rate of vSphere Foundation and includes components you were not buying. | Estates that ran a narrow product set. The gap between what you used and what the bundle contains is the whole increase for some customers. |
| Per-core metric with a 16-core minimum per CPU | Every physical CPU is licensed at a minimum of 16 cores whether or not it has 16. Four hosts with two 8-core CPUs each hold 64 physical cores but bill as 128. | Smaller estates and older hardware with lower core-count CPUs. This is where a modest environment can double its billable footprint without adding a single VM. |
| Legacy discounts did not carry forward | Whatever pricing you negotiated under the old program, including multi-year and volume concessions, is not a baseline for the new contract. Renewals are priced against current program terms. | Long-tenured customers with good historical pricing. The better your old deal was, the larger the jump looks. |
There is a fifth item worth checking separately. Some quotes apply an order floor larger than the published 16-core-per-CPU minimum, including a 72-core figure. Broadcom's public core-count guidance verifies the 16-core minimum per physical CPU. Treat anything above that as a commercial term for your specific transaction and ask the seller to identify it as such in writing.
What size increase should you expect?
Honestly: there is no benchmark, and anyone quoting you a universal percentage is guessing. The figures circulating in coverage of this transition come from individual disclosures, litigation filings, and trade-association aggregates, not from a controlled pricing study. They are useful as evidence of how far outcomes have ranged, and not as a number you should expect.
Publicly documented cases include a Utah water district whose renewal rose from roughly $30,000 to roughly $159,000 year over year, a U.S. Department of Energy report of a 400 percent increase in one environment, and European association members reporting changes far above that. The full set, with sources and the caveats that go with each one, is in the sourced price-increase table.
To put real figures against your own estate rather than someone else's, count your physical CPUs and cores per CPU, apply the 16-core minimum to each CPU, and multiply by the per-core rate for the tier you are actually being quoted. The cost calculator runs that math alongside the three-year cost of the alternatives.
Is any of it negotiable?
Parts of it are, and the parts that move most are not discounts at all. They are corrections.
- Bundle tier. If you are quoted Cloud Foundation and do not run NSX or vSAN at the scale that justifies it, requesting vSphere Foundation pricing is a correction to the quote, not a favor. It is typically the single largest lever available.
- Billable core count. Reconcile what is on the quote against what you actually have racked and running. Decommissioning or consolidating hosts before signing changes the billable base, but it needs lead time to be real by the renewal date.
- Order floors above the published minimum. Ask for the calculation and the commercial basis in writing.
- Percentage discount on the total. This exists but is generally smaller than the two corrections above, and it moves further when you have a competing quote in hand rather than an intention to get one.
- Term length. Not a price lever so much as an options lever. A shorter term costs a small multi-year discount and preserves your ability to act next time.
The full menu, ranked by what each one moves and what it costs you in flexibility, is on the renewal cost reduction page.
What the increase tells you about the next one
This is the part most teams skip while dealing with the immediate deadline, and it matters more than the current number.
The structure you are renewing into is subscription-based and per-core. That means future renewals track three things: your core count, your bundle tier, and the term you agree to now. There is no longer a sunk perpetual license underneath the relationship acting as a floor. If your estate grows, or you refresh onto higher-core-count CPUs, the licensed footprint grows with it.
The practical consequence is that the term you sign is a decision about leverage. A three-year agreement signed under deadline pressure typically buys a low single-digit discount and gives up the ability to price alternatives for three years. A shorter term costs that discount and buys evaluation time. Which is right depends on whether you already know your options, and most organizations facing their first renewal under this model do not yet.
That is the honest reason to look at alternatives now even if you fully intend to stay on VMware. Knowing what a managed VMware provider, Nutanix, or Proxmox would actually cost for your estate is what turns the next renewal conversation into a comparison rather than an acceptance.
Common mistakes reacting to the increase
- Comparing the new subscription line directly to last year's SnS line. They bill for different things. Build a three-year view of both instead.
- Assuming the quoted tier is the right tier. Bundle assignment is the most common single source of an inflated number and the easiest to correct.
- Taking a percentage discount as the win. A discount on an inflated base leaves the inflation in place.
- Treating a reported figure from another organization as your benchmark. Those cases differ in bundle, cores, term, support level, and prior discount.
- Letting the deadline pick the term. Signing multi-year to end the conversation is the decision that costs the most over time.
- Waiting until after signing to find out what alternatives cost. The comparison is what makes the corrections above stick.
What to do next
- Pull the quote and identify the bundle tier, the billable core count, the term, the support level, and any add-ons priced separately.
- Count your physical CPUs and cores per CPU, apply the 16-core minimum per CPU, and compare that to the billed core count.
- Determine whether you actually run the components in the tier you are quoted.
- Ask, in writing, for the basis of any order floor above the published minimum.
- Work out how many days of runway you have before the renewal date, because that determines which levers are still available.
- Get at least one competing number priced before you negotiate, even if you expect to stay.
VMware renewal increase FAQ
Why did my VMware renewal go up so much under Broadcom?
Four changes stack on top of each other: perpetual licenses and SnS renewals ended, so a maintenance percentage became a full subscription price; thousands of SKUs consolidated into a handful of per-core bundles, so many estates are quoted more than they ran; licensing moved to a per-core metric with a 16-core minimum per physical CPU; and legacy negotiated pricing did not carry forward. Which of the four apply to you determines the size of the change.
Is there a typical percentage increase for a VMware renewal?
No. There is no published benchmark, and the widely circulated figures come from individual disclosures rather than a controlled study. Use the sourced cases to understand the range of outcomes, then calculate your own from the bundle, billable cores, term, support, and add-ons in your quote.
Is a Broadcom VMware renewal increase negotiable?
Parts of it are. Bundle tier and billable core count are corrections rather than concessions and usually move the most. A percentage discount on the total is a separate, generally smaller lever, and it moves further when you hold a priced alternative.
Will my next VMware renewal go up again?
Future renewals track your core count, your bundle tier, and the term you sign now. The term length is the real decision: a shorter term costs a small multi-year discount and preserves the ability to act on an evaluation instead of renewing under deadline pressure.