Penalty Fees Return and the Minimum Number of Licensable Cores Increases Significantly: Broadcom Continues Its Restructuring
Broadcom, the new owner of VMware, continues its restructuring. Starting from April 10, 2025, an important change to the licensing model will take effect: The minimum number of ordered cores will increase from 16 to 72, for both new licenses and renewals. This adjustment follows the abolition of perpetual licenses, which took place in the spring of 2024.
The new regulations apply to customers worldwide. For example, if a company needs a single-socket server with 16 cores, it will now have to license 72 cores—56 more than actually required. A customer with five dual-processor servers, each with 16 cores (totaling 160 cores), can still license 160 cores. If different vSphere versions are needed, the minimum number for each version must be purchased separately. However, this rule applies solely to the minimum order quantity, as indicated in the Reseller Pricebook. On a core level, a minimum of 16 cores remains required. Therefore, purchasing smaller quantities, which was common before, will no longer be possible.
Additionally, Broadcom is reintroducing penalty fees for existing customers who do not renew their subscriptions on the anniversary. The penalty amounts to 20 percent of the price for the first license year. These so-called Reinstatement Fees were originally suspended during Broadcom’s acquisition. Screenshots of Broadcom’s announcements are confidentially available to iX. Arrow had previously reported the move to the specialist service The Register.
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