VMware licensing used to be complicated but stable. Under Broadcom it's simpler on paper and far more expensive in practice. This guide walks through the old model, the new model, and the decisions you'll face at renewal, including the option most customers don't know exists.
The old model: perpetual + SnS
Before December 2023, the standard VMware deal looked like this:
- Perpetual license, per CPU socket. You bought vSphere Standard or Enterprise Plus once, per physical CPU, and owned the right to run it forever.
- Annual Support and Subscription (SnS) at roughly 20–25% of license cost, covering patches, updates, and support.
- À la carte everything. vCenter, vSAN, NSX, Site Recovery Manager, Aria, each purchased only if you needed it.
A typical mid-market shop with 8 dual-socket hosts might have spent $60k–$120k up front years ago and $15k–$30k a year in SnS since. That annual number is the baseline against which today's quotes look shocking.
The new model: subscription, per core
Everything sold today is an annual (or multi-year) subscription, metered per physical CPU core, with three rules that drive the cost:
- Per-core counting. Every physical core in every licensed host counts. Modern CPUs ship with 32, 64, or 96+ cores, so core counts balloon relative to old socket counts.
- 16-core minimum per CPU. A CPU with fewer than 16 cores is licensed as 16 anyway.
- Commercial quote terms. Broadcom's public guidance verifies the 16-core minimum per physical CPU. If a quote applies a larger order floor, including 72 cores, require the seller to identify it as a commercial term in writing rather than treating it as a universal core-count rule.
Worked VMware renewal examples
Use this formula before comparing quotes: billable cores = the sum of max(actual cores per CPU, 16) across every licensed CPU.
| Environment | Physical cores | Billable cores | Why |
|---|---|---|---|
| 4 hosts, 2 CPUs per host, 8 cores per CPU | 64 | 128 | Eight CPUs are each counted at the 16-core minimum |
| 4 hosts, 2 CPUs per host, 24 cores per CPU | 192 | 192 | Every CPU is already above the minimum |
| Host A: 2 × 8 cores; Host B: 2 × 24 cores | 64 | 80 | Host A counts as 32; Host B counts as 48 |
Then calculate annual software price = billable cores × contracted per-core rate + separately priced add-ons. Do not compare that number only with last year's SnS. Build a three-year view that includes hardware, support, migration, operations, and any products displaced or newly bundled. For a line-by-line method, use the VMware renewal quote review.
Publicly reported VMware renewal price increases
Public disclosures show how sharply some VMware renewals changed after the licensing and packaging transition. These cases are evidence of what specific organizations reported, not universal pricing benchmarks. Product bundles, licensed cores, support levels, contract terms, infrastructure footprints, and prior discounts differ from one renewal to another. For how these mechanics combine on a single invoice, see why your VMware renewal went up.
| Organization | Reported VMware price change | Reported response or context | Source |
|---|---|---|---|
| Metropolitan Water District of Salt Lake & Sandy | Its renewal rose from $30,453.04 in September 2024 to $158,644.72 in September 2025, approximately 5.2 times the prior amount. Its board materials describe the increase as fivefold. | Staff reduced an initial $175,000 quote, submitted a purchase order before the deadline to avoid reinstatement fees, and planned to investigate alternatives before the next renewal. | Official board document (PDF) |
| U.S. Department of Energy | DOE reported a “400% increase” in VMware renewal costs for systems and applications in its EHSS environment. We reproduce DOE’s own phrasing rather than restating it as a multiple, since the two readings in common use (four times and five times the prior cost) differ materially. | DOE documented a plan to replace VMware with Microsoft Hyper-V and estimated a $274,000 annual reduction in virtualization software cost for the specified systems. | DOE cost-savings report (PDF) |
| Anexia | Anexia's CEO did not disclose the precise increase. The Register article republished on Anexia's site reported that it understood the proposed increase to exceed 500%. | The Austrian cloud provider migrated 12,000 VMs from VMware to a KVM-based platform. Its CEO described the proposed commercial impact as potentially existential. | Anexia's republished report |
| AT&T | AT&T alleged in court-related filings that a proposed licensing arrangement would increase its annual VMware cost by approximately 1,050%. | The figure was part of contested litigation, so it should be read as AT&T's allegation rather than an independently established price comparison. | CIO Dive court-reporting summary |
| CISPE members | The European Cloud Competition Observatory reported aggregate member increases ranging from 800% to 1,500% and said prices had often increased tenfold. | These are association-level reports from unnamed members, not results from one identified customer or a controlled pricing study. | ECCO report appendix (PDF) |
Source note: Sources were verified July 25, 2026. The organizations above are not presented as VMware Migration Hub customers and do not endorse this site. Use the examples to understand the range of publicly reported outcomes, then calculate your own renewal from the exact products, billable cores, term, support, and commercial terms in your quote.
VCF vs. VVF: the two bundles that matter
| VMware Cloud Foundation (VCF) | VMware vSphere Foundation (VVF) | |
|---|---|---|
| Positioning | Full private-cloud platform | "Just virtualization" tier |
| Core platform | vSphere plus the broader VCF private-cloud stack, including vSAN, NSX, operations, and automation components | vSphere-focused bundle with operations capabilities and a smaller feature footprint |
| Published vSAN entitlement | 1 TiB per licensed VCF core | 0.25 TiB per licensed VVF core, with entitlement rounded up to the next TiB |
| Metric | Per core, annual subscription | Per core, annual subscription |
| Best for | Orgs actually using NSX/vSAN at scale | Orgs that ran vSphere Standard/Enterprise Plus |
| Watch out for | Paying for the full stack you won't deploy | Upsell pressure to VCF; feature gaps vs. your old edition |
Packaging changes across product generations and contracts. Confirm the bill of materials, entitlements, support level, and price for your exact quote rather than relying on a public list-price estimate.
What happens when support lapses
If you hold perpetual licenses and let SnS expire (or it already has):
- The software keeps running. Nothing is remotely disabled.
- No more patches. You cannot legally download security updates or new builds. Every new ESXi CVE becomes a permanent, unpatchable exposure. (Broadcom has occasionally released free critical patches for severe vulnerabilities, but you cannot rely on that.)
- No support. Severity-1 outage? You're on your own or paying a third-party support firm.
- Compliance and insurance risk. PCI, HIPAA, and CMMC assessors flag unsupported hypervisors; cyber insurers increasingly ask the question on renewal applications.
- Re-entry is expensive. Returning to a subscription after a lapse can involve back-dated fees or penalty pricing. Broadcom has also sent audit-flavored "cease and desist" letters to lapsed perpetual customers reminding them not to apply updates.
If you're weighing how long you can safely run unsupported, read the VMware End of Life Guide first.
Renewal negotiation: what's actually movable
This is the short version. For the full playbook, the renewal timeline, and a prep checklist, see the dedicated VMware renewal negotiation guide.
Honest answer: less than you'd like, but more than zero. Typical realities we see in mid-2026:
- Bundle tier is the biggest lever. Pushing a quote from VCF to VVF (when you genuinely don't need NSX/vSAN) moves more money than any discount percentage.
- Multi-year terms buy single-digit to low-double-digit discounts, at the cost of locking in before you've evaluated alternatives. A 1-year bridge term is often worth a slightly worse rate.
- Bring a competing number, not just a question. Broadcom's discounting is thin for mid-market, but it moves when a signed managed-provider or Nutanix proposal is already on the table. Get real quotes via our comparison guide and calculator before the negotiation call, not after.
- Challenge every unexplained minimum in writing. Reconcile the quote to the verified 16-core-per-CPU rule, then ask the seller to identify any additional order floor, how it was calculated, and whether it can be changed.
- Audit your core count first. Decommissioning or consolidating hosts before the quote is issued directly shrinks the licensed base. Don't pay for cores you can retire before the renewal date.
The option most customers miss: VCSP pricing through a managed provider
Broadcom's partner purge concentrated VMware hosting into a smaller set of large VMware Cloud Service Provider (VCSP) partners, firms like 11:11 Systems, Expedient, TierPoint, Flexential, and Rackspace. These providers commit to enormous core counts and license VCF at a scale price no individual mid-market company can get, then sell it back as managed capacity per VM, per host, or per resource pool.
The practical upshot: you can keep vSphere, same tooling, same admin skills, same VMs, and still exit Broadcom's direct pricing. For many 50–500 VM environments, a managed VMware cloud lands materially below a direct VCF renewal once you count hardware refresh, data center, and staff time, not just license line items. It's also the lowest-disruption path, since workloads move with vMotion/HCX rather than being converted.
| Compare in every VCSP proposal | Questions to ask |
|---|---|
| Compute and memory | Dedicated or shared? What is the reservation, burst policy, and oversubscription? |
| Storage and protection | Which performance tier, backup retention, replication, and disaster recovery are included? |
| Operations and support | Who patches the stack, handles severity-1 incidents, and owns the SLA? |
| Network and migration | What do connectivity, egress, HCX, professional services, and cutover support cost? |
| Contract | What are the term, growth commits, renewal protections, and exit provisions? |
Browse the provider directory to see who plays in this space, or get matched in one step via the free assessment.
Before your renewal: a 5-step prep list
- Inventory hosts, CPUs, and physical cores, know your number before Broadcom tells you theirs.
- Confirm your exact SnS/subscription expiry date and any auto-renew terms.
- Get quotes for both VVF and VCF, plus at least one managed-provider and one alternative-platform number.
- Model 3-year TCO, not year-one price. Our calculator does this in minutes.
- Start 6+ months out. Leverage evaporates 30 days before expiry.
VMware licensing FAQ
How does VMware's 16-core minimum work?
VCF and VVF count physical CPU cores, with a minimum of 16 licensed cores for each physical CPU. A server with two 8-core CPUs therefore requires 32 licensed cores.
What is the difference between VCF and VVF?
VCF is the broader private-cloud platform. VVF is a smaller, vSphere-focused bundle. Exact components and entitlements depend on the product generation and contract.
Is 72 cores a universal VMware licensing minimum?
Broadcom's published core-count guidance verifies a 16-core minimum per physical CPU. Treat any larger quote or order floor as a commercial term and have the seller confirm it in writing.
Can a VCSP managed provider be an alternative to a direct VMware renewal?
It can. Compare the full managed-service price, included operations, storage, protection, migration, egress, contract term, and SLA against the direct renewal.