Big changes are coming to VMware by Broadcom licensing. For SMB customers it’s not great news, and if you’re an MSP whose customers are going to be affected by the changes, you need to look at alternatives.
So, what are the changes and what do they mean? Here’s the overview:
From the 10th April, Broadcom is rolling our new licensing rules which are set to have a significant impact on costs, flexibility and operations, particularly for smaller customers. For lots of MSPs, the shift is going to be more than just a pricing headache, it’s a sign that it’s time to explore more scalable alternatives.
You may already be aware of the unfolding situation, here’s the rundown:
Minimum licensing increase
Broadcom’s new minimum licensing purchase will be 72 cores. The previous minimum was 16 cores, so this isn’t a tiny jump. The significant increase will disproportionately affect smaller customers, edge environments and remote offices.
Late renewal penalty increase
As well as the minimum licensing increase, Broadcom are also increasing the renewal penalty to 20% for any customers not renewing by their anniversary date. A late renewal penalty has already been in place but the increase to 20% will have major financial impacts.
CRN shared a memo from Distributor Arrow which was sent to their solution providers:
“If a customer has a single-processor server with 8 cores, VMware by Broadcom will license 72 cores. On the other hand, if a customer has 5 dual-processor servers with 16 cores each (i.e. 160 cores), VMware by Broadcom will license 160 cores,” the memo stated. “This new requirement may require adjustments to your current quotes.”
The message feels pretty clear from Broadcom. If you’re only offering transactional license sales, you’re being priced out. For customers who have been comfortable renewing perpetual licences, their annual costs look set to double.
“What I think is fair to say is that Broadcom does not really care that much about those just pushing licenses … they want partners who take ownership and provide value. If you want to make a living out of selling tons of small license bundles, you might be on the wrong path here.”
Broadcom’s new licensing structure is, frankly, a poor fit for SMBs. The 72-core minimum is excessive for most small businesses and a 20% penalty for late renewals is harsh and unnecessary. The changes are actively discouraging smaller deployments, remote office setups, and agile IT environments.
For MSPs, this creates an opportunity and a responsibility to lead your clients to better solutions
Customers affected by these changes are going to be looking for an alternative. If you support SMB clients or clients who need flexible, secure remote work solutions for distributed teams there’s a better way forward … Parallels.
Parallels Secure Workspace provides highly secure, audited access to desktops, files and various applications including legacy, web and SaaS on any device. Complementing this is Parallels Remote Application Server (RAS).
Parallels is a strong fit for MSPs, and a fantastic alternative to customers now looking to move away from VMware, here’s why:
Parallels isn’t just a VMware alternative, it’s a secure, flexible and MSP-aligned solution built for today’s IT demands.
Brigantia are here to support you, from technical support for migration to dedicated training. Our advice? Don’t wait for VMware costs to spiral. Get in touch to find out more on how Parallels can support your clients.
Find out more about Parallels here: https://www.brigantia.com/vendors/parallels
Get in touch with our team here: https://www.brigantia.com/contact