February 5, 2026
Two years after Broadcom completed its $69 billion acquisition of VMware in November 2023, the licensing overhaul that many hoped might soften over time has instead become the new reality. If you're an IT leader staring down a VMware subscription renewal, it’s time to think through whether it’s still providing enough value to justify the cost.
This topic can get pretty complicated, so on this blog, we wanted to talk through Broadcom’s pricing changes, what your options are in 2026, and what you need to know if you’re thinking of jumping ship.
What Changed After the Broadcom VMware Acquisition
Broadcom didn't just tweak VMware's pricing. They fundamentally restructured how you buy and license their products. The perpetual licensing model that many organizations relied on for predictable budgeting? Gone. Two years into the subscription-only model, it's clear this isn't a phase. This is how VMware works now.
But the licensing model shift is only part of the story. Broadcom also dramatically simplified the product lineup. Essentially, the vSphere Standard and Enterprise Plus editions that probably power your data center today have been retired. Your choices now are VMware Cloud Foundation (VCF) or vSphere Foundation (VVF).
But here's the catch with VVF: even when it's available, you're looking at a one-year contract maximum. Why? Because Broadcom is discontinuing VVF entirely in 2026. After that, VCF becomes your only option.
What the New VMware Licensing Model Means for Your Budget
Let's talk numbers, because that's where this gets real. While VVF costs $190 (MSRP) per core, per year, VCF — what Broadcom will be pushing you into — is $400 per core, per year.
If you're running a few hundred cores, then you're suddenly looking at annual costs that can easily hit six or seven figures. For many of our clients, this represents a 3x to 10x increase over their previous licensing costs.
That's not a budget line item adjustment. That's a strategic problem that requires a strategic response.
The Real Question: Is Broadcom’s VCF Actually Worth It?
Before I talk about alternatives, let's be fair to what VCF actually delivers. This isn't just vSphere with an inflated price tag. You're getting a comprehensive platform designed to bring cloud-like capabilities to an on-premises environment.
The VCF bundle includes:
- vSphere Enterprise Plus for your core compute virtualization
- vSAN Enterprise for software-defined storage
- NSX for network virtualization and micro-segmentation
- Tanzu Kubernetes Grid for container orchestration
- Aria Suite for multi-cloud management and automation
If you're building out a serious hybrid cloud strategy, implementing zero-trust network security, or running containerized applications alongside traditional VMs, VCF genuinely delivers value that can justify the premium. The integrated lifecycle management alone saves considerable operational overhead.
But here's the honest truth: not every organization needs all of these capabilities. If you're running traditional virtualized workloads — database servers, file servers, application servers — without plans for software-defined networking or container orchestration, you're paying for a Ferrari when a reliable sedan would get you where you need to go.
The value is there, but only if you're actually going to use it.
So What Else Is Out There? Your Realistic Alternatives
The good news is, there are several viable paths forward. Let's talk through what actually works in the real world.
Microsoft Hyper-V: The Natural Migration Path
If you're already running Windows environments — and most organizations are — Hyper-V deserves serious consideration. Microsoft's hypervisor has matured into a robust platform that integrates seamlessly with Windows Server and Azure. For many of our clients, it’s the path of least resistance, in no small part because their team’s already familiar with Microsoft tools, management patterns, and support processes.
The Azure integration is particularly compelling. If any part of your long-term strategy involves cloud migration or hybrid infrastructure, Hyper-V provides consistent management across on-premises and cloud environments. That continuity matters when you're planning three to five years out.
HPE Virtualization Essentials: Built for Stability
This solution combines mature KVM technology with HPE's enterprise-grade support infrastructure. Here’s what my team likes about it: the licensing is straightforward, the platform is stable, and HPE's support organization is world-class. For small to mid-market organizations that need reliable virtualization without complexity, it hits the sweet spot between capability and manageability.
The underlying KVM platform has also been battle-tested in production environments worldwide, so you're building on proven technology rather than betting on something unproven.
Nutanix AHV: If Hyperconvergence Fits Your Strategy
Nutanix offers a solid hypervisor, but with an important architectural requirement: it's built specifically for hyperconverged infrastructure. You'll need specialized hyperconverged server hardware to run it.
Now, here's where this gets interesting. If you're already running HCI or planning to move in that direction, Nutanix can be excellent. The tight integration delivers real performance and management benefits. But if you're specifically looking to move away from tightly coupled infrastructure — which I’ll talk about in a moment — Nutanix might not align with your broader strategy.
Proxmox VE: The Open Source Option (With Caveats)
I’d be remiss not to mention Proxmox for organizations comfortable with open source platforms. It's capable, it's actively developed, and the community is strong. But let's be clear about the trade-off: commercial support is limited compared to enterprise vendors.
If your organization requires guaranteed response times, extensive professional services, and the assurance of vendor-backed support, Proxmox comes with risks that might outweigh the licensing savings.
That doesn't necessarily make it wrong. It just makes it a bad fit for organizations with limited IT resources.
Why Hyperconverged Infrastructure Is Losing Steam
Hyperconverged infrastructure, which uses software to combine compute, storage, networking, and virtualization into a single system, sounds great on paper. But a lot of organizations are moving away from these products due to rising costs, vendor lock-in concerns, and the shift toward edge computing and hybrid clouds.
Here’s the short list of former HCI products that have been discontinued:
- Cisco HyperFlex
- NetApp HCI
- Pivot3 Acuity
- Maxta hyperconvergence software
Even the survivors have made some telling adjustments. Scale Computing restructured its approach, and HPE consolidated SimpliVity into broader infrastructure offerings rather than maintaining it as a standalone HCI brand.
What does this mean for your decision? If you're considering leaving VMware specifically because you're tired of being locked into an expensive, tightly integrated platform, moving to another hyperconverged solution deserves careful scrutiny. You might be trading one lock-in for another.
One Hypervisor Alternative You Might Not Have Considered: The Cloud
Here's a perspective shift worth considering: maybe this isn't about choosing a different hypervisor. Maybe it's about rethinking whether you need to manage hypervisors at all.
Microsoft Azure: Where We're Seeing Strong Results
For organizations evaluating cloud migration, Microsoft Azure consistently delivers strong outcomes.
Okay, yes, we’re Microsoft Solutions Partners, but this isn't just vendor preference. It's based on what I see working for clients in the real world. And just for the record, we don’t recommend solutions because of our partnerships. It’s the other way around. We partner with manufacturers and software developers because we believe their solutions offer our clients the most ROI.
Case in point, Azure provides robust migration tools, and if you're already in the Microsoft ecosystem, the management experience feels familiar. Its hybrid capabilities are particularly strong, allowing you to maintain on-premises infrastructure where it makes sense while using the cloud for scalability, disaster recovery, or workloads that benefit from cloud-native services. Azure VMware Solution even provides a VMware-compatible environment in Azure if you need that bridge during transition.
While AWS and Google Cloud Platform certainly have their merits, Azure's integration with existing Microsoft technologies creates a smoother path for a lot of organizations we work with.
Hybrid Strategies: The Best of Both Worlds
You don't have to make an all-or-nothing decision. Many organizations are adopting hybrid approaches that keep certain workloads on-premises while moving others to the cloud. This lets you optimize placement based on each application's specific requirements, like compliance needs, performance characteristics, cost profile, and data gravity.
Kubernetes: An Alternative for Containerized Workloads
If you're running containerized applications, Kubernetes-based infrastructure might eliminate the need for traditional hypervisors entirely for those workloads. Container-native approaches can deliver better resource efficiency and operational simplicity for the right applications.
What You Need To Know Before Moving Away From VCF
If you’re going to make a move, just know that you can’t throw this thing together at the last minute. It’s a big IT project, and like a lot of big IT projects, it can get messy.
1. Don’t Underestimate the Technical Work
Not every workload behaves identically across hypervisors. Application dependencies, network configurations, and storage integrations require careful evaluation and testing.
Some apps may need modifications to function properly on alternative platforms. That's just the nature of infrastructure migration.
2. There’s a Learning Curve
Moving to a different platform might require training, documentation updates, and new troubleshooting approaches that could temporarily slow down your IT team. Plan ahead for this realistically.
Those three months after migration are NOT going to be as smooth as the three months before.
3. The Financial Math Is Complicated
Migration isn't just about comparing licensing costs. You need to factor in:
- Any outsourced services for your migration
- Potential hardware upgrades or replacements
- Running parallel environments during transition
- The productivity impact during the learning curve
- Risk mitigation and contingency planning
For some organizations, the total cost of migration could be more expensive than just staying put — at least in the first year. You might only start to see ROI in year 3.
Is it still worth it? If you’re not going to be using VCF’s advanced capabilities, probably. But it’s important to keep the bigger financial picture in mind.
4. Timing Is Everything
Migrations often take months, not weeks. If you're also planning a hardware refresh, you might want to coordinate the timing. Paying for migration labor on aging infrastructure you're about to replace anyway doesn't make financial sense. Aligning these initiatives can turn two expensive projects into one well-orchestrated infrastructure modernization.
5. You May Have Supply Chain Issues
Different hypervisors have different hardware requirements. Some need specific CPU features, particular memory configurations, or certain storage subsystem capabilities. Before you commit to a platform, verify your existing hardware is compatible, or budget for necessary upgrades.
And let's talk about current market realities: hardware costs and availability aren't what they used to be. DDR5 RAM and SSD prices remain volatile. Lead times for server procurement have stretched from weeks to months in many cases.
If your strategy involves new hardware, I strongly advise you to start those conversations now. Waiting until thirty days before your VMware subscription expires to order servers is asking for problems.
6. Check Your Backup and Monitoring Tools
Backup solutions, monitoring platforms, security tools, and disaster recovery systems all need to integrate with your virtualization layer. Before you finalize any migration decision, make sure that your critical supporting tools will work with your new solution — whatever that may be.
If you need to make a change, here are a few solutions I recommend:
- Veeam
- Cohesity
- HYCU
- Rubrik
Why these four?
Well, in the backup space, Veeam provides excellent cross-platform support. Veeam Backup & Replication works with VMware, Hyper-V, Nutanix AHV, and Proxmox. If you're already standardized on Veeam, that continuity can simplify your migration considerably.
Cohesity offers another strong option with its unified data management approach. If you’re looking for consistency across multiple platforms, it’s definitely worth a look.
For Nutanix-specific environments, solutions like HYCU and Rubrik provide specialized capabilities optimized for hyperconverged infrastructure.
A Realistic Planning Timeline
Ideally, you’d start your evaluation 3–6 months BEFORE it’s time to renew. That way, you’ll get enough time to evaluate your options, plan your migration, bring in any outside expertise you need, and make your transition smooth.
However, if you think you may need to make additional hardware purchases, you should steer closer to that 6-month planning period. Three months may be cutting it too close to get the equipment you need.
Making the Switch Easier for Your Team
Sure — it’s entirely possible for a fully staffed, fully capable in-house IT team to accomplish a project like this. When we partner with other organizations on IT projects, it’s not always because their team can’t get them done. It’s that they’re already busy with other things; these projects aren’t something they do every day, and it’s just not the best use of their time.
These kinds of projects can bog down an IT team for months. If that’s not the way you want to spend an entire quarter of the year, we can help. We've guided organizations through VMware renewals, migrations to alternative hypervisors, and cloud transitions. We can help you understand your real options, get accurate quotes, and build a plan that makes the most sense for your business moving forward.
