The July 12 VMware launch for vSphere 5 was comprehensive in its scope. But much of what it offered was overshadowed by changes to its vRam licensing model  that aligned costs with the benefits of virtualization rather than with the physical attributes of each individual server. Today, VMware made a turn around and adjusted the vRam licensing in line with customer feedback.

After the July 12 news came a lot of criticism for the plan as summed up by the Virtualization Practice:

The “trouble” stems from VMware’s decision to change licensing from a processor-centric to a committed memory-centric (vRAM) model.  VMware really had little choice but to make this change to memory-based licensing.  As virtualization extends across a broader range of processor platforms it would otherwise have become increasingly difficult for VMware to maintain licensing parity between processor architectures, especially when it comes to dealing with emergent enterprise processor architectures such as those coming from ARM Holdings. charging by the core not a viable strategy when the capabilities of each core can very so much, and when the number of processor cores are likely to increase far more rapidly than memory utilization for any given workload.  While this change makes a lot of sense for customers who are ready to fully embrace the idea of treating its virtual infrastructure as a private cloud service, and should be acceptable to the large majority of remaining customers once they have come to terms with the costs and benefits of vSphere 5, some will loose out badly.

Bogomil Balkansky is vice president of product management for VMware. In a blog post today he detailed the changes that VMware is making to the new licensing model.

Here’s how Balkansky explained it:

We are a company built on customer goodwill and we take customer feedback to heart.  Our primary objective is to do right by our customers, and we are announcing three changes to the vSphere 5 licensing model that address the three most recurring areas of customer feedback:

• We’ve increased vRAM entitlements for all vSphere editions, including the doubling of the entitlements for vSphere Enterprise and Enterprise Plus.
• We’ve capped the amount of vRAM we count in any given VM, so that no VM, not even the “monster” 1TB vRAM VM, would cost more than one vSphere Enterprise Plus license.
• We adjusted our model to be much more flexible around transient workloads, and short-term spikes that are typical in test & dev environments for example.

I doubt the July 12 launch for vSphere 5 will go down as the best in VMware history. It was upended a bit by the Citrix news about its acquisition of Cloud.com. Then came the criticism for the new licensing.

It was all overshadowing the news about vSphere 5 which had a host of new features.

Services Angle

The real future for VMware is in providing the full spectrum offering for customers to move to the cloud. That’s why this licensing change is important. It defuses the issue in time for VMworld, which we expect will be all about the cloud and its deeper integrations with its service providers.