What changed in VMware licensing after the Broadcom acquisition

Broadcom completed its acquisition of VMware in November 2023. Over the following months, Broadcom restructured VMware’s licensing model substantially. The key changes are documented below. Pricing impacts vary considerably by organization size, hardware configuration, and what was previously licensed.

• Licensing Perpetual licenses have been eliminated. All customers are now on annual subscriptions. Organizations that had budgeted capital expenditures under the perpetual model now have ongoing operational costs for the same software.
• Bundles The product catalog has been consolidated from thousands of SKUs to four bundles. Standalone vSphere and vCenter are no longer available — customers are required to license NSX, vSAN, and Aria management tools as part of the bundle regardless of whether those components are used.
• Minimums As of April 10, 2025, the minimum licensed core count per CPU socket is 72, up from 16. A server with 10 physical cores per socket is licensed as if it has 72 — the delta is paid for but not usable.
• Renewal Missing a renewal anniversary date results in a 20% surcharge on the first-year subscription price, applied retroactively. There is no documented grace period.
• Escalation Subscription contracts include annual price escalation, typically 5–10% per year. Costs increase over the subscription term on the same hardware and workload.
• Telemetry Subscription licensing requires ongoing connectivity for compliance verification. Phone-home telemetry is enabled by default. Organizations with air-gapped or restricted-network environments should review the connectivity requirements carefully before renewing.

Cost impact varies significantly. Organizations with older hardware (fewer physical cores per socket) are more affected by the minimum core rule than those running current-generation CPUs. Organizations that previously purchased only vSphere Essentials or standalone vCenter are more affected by bundle consolidation than those already running the full stack. Actual renewal quotes should be the basis for any cost analysis.

Pricing comparison: VMware vs. Proxmox VE

Proxmox VE is open-source software licensed under the GNU AGPL v3. Clustering, HA, live migration, KVM virtualization, LXC containers, and software-defined networking are all available without a paid subscription. Support subscriptions provide access to the enterprise package repository (tested, stable package updates) and vendor support channels. Functionality is not gated by subscription tier.

The comparison below reflects published licensing terms as of mid-2025. VMware pricing varies by volume, reseller, and negotiation — the figures in the scenario below are illustrative. Use your actual renewal quote for any real cost comparison.

VMware pricing varies significantly by reseller, volume, and negotiation — actual quotes may differ substantially from these estimates. Proxmox pricing reflects published list pricing from proxmox.com. These figures are illustrative only. ECT Consulting performs detailed cost modeling as part of any migration assessment, using your actual VMware renewal quote as the baseline.

Backup platform considerations: Proxmox Backup Server vs. Veeam

Veeam Backup & Replication is a mature, well-supported backup platform with broad integration across VMware, physical Windows workloads, and cloud targets. It has no native Proxmox VE integration, which means existing Veeam deployments do not carry forward to Proxmox without third-party plugins.

Proxmox Backup Server (PBS) is the purpose-built backup solution for Proxmox VE. It is open-source and priced per backup server rather than per client. The table below compares capabilities relevant to a migration decision — it is not a comprehensive feature comparison of either product.

Environments with Veeam agents protecting physical Windows servers alongside VMware VMs may warrant a hybrid approach: retaining Veeam agent coverage where PBS does not reach while migrating VM-level backup jobs to PBS. ECT Consulting evaluates backup architecture as part of any migration engagement and will not recommend removing Veeam coverage before PBS coverage is confirmed and tested.

Migration methodology

A VMware-to-Proxmox migration involves more than converting disk images. Snapshot chain state, network configurations, storage dependencies, Windows driver requirements, and application-layer behavior all introduce risks that aren’t visible until something is running in production. The process below reflects the approach ECT Consulting uses for production migrations.

Proxmox VE platform overview

ECT Consulting’s Proxmox experience

ECT Consulting runs production Proxmox infrastructure internally — the same platform we help clients migrate to. This is relevant because it means our assessments and migration plans are based on firsthand operational experience, not vendor documentation alone.