{"id":1404,"date":"2026-10-15T09:03:27","date_gmt":"2026-10-15T07:03:27","guid":{"rendered":"https:\/\/bonet.systems\/?p=1404"},"modified":"2026-10-15T09:04:36","modified_gmt":"2026-10-15T07:04:36","slug":"from-vmware-esxi-to-proxmox-ve-a-64-reduction-in-annual-licensing-costs","status":"publish","type":"post","link":"https:\/\/bonet.systems\/en\/from-vmware-esxi-to-proxmox-ve-a-64-reduction-in-annual-licensing-costs\/","title":{"rendered":"From VMware ESXi to Proxmox VE: A 64% Reduction in Annual Licensing Costs"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">How a routine hardware refresh, forced by VMware\u2019s pricing shakeup, became an opportunity to reduce costs, modernise the infrastructure and simplify day-to-day IT operations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A US data center company had to replace an aging internal server just as <a href=\"https:\/\/investors.broadcom.com\/news-releases\/news-release-details\/broadcom-completes-acquisition-vmware\" target=\"_blank\" rel=\"noopener\">Broadcom, VMware&#8217;s new owner<\/a>, overhauled its pricing model.\u00a0<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Renewing VMware on the replacement infrastructure was estimated at <strong>~<\/strong><strong>$3,500<\/strong> (approx. \u20ac3,000) <strong>per year<\/strong>, with costs expected to increase as the business grew.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Rather than automatically renew, the customer asked us to assess whether VMware still made sense for an environment running just three production VMs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We migrated to <strong>Proxmox VE<\/strong>, reducing annual virtualization licensing costs by approximately <strong>64%<\/strong> while building a more modern and manageable infrastructure platform.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">\u201cPredictable costs were the priority for us alongside a platform that actually fits our infrastructure needs. We got both.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Eugene Rutberg<\/strong>, Partner, Level IV<\/p>\n<\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\">At a glance<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Before: <\/strong>a single VMware ESXi host at the end of its hardware life, running three production VMs (2\u00d7 Windows Server and 1\u00d7 Linux)<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Drivers: <\/strong>a planned hardware refresh combined with Broadcom\u2019s changes to VMware licensing and packaging<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Target platform: <\/strong>a single-socket Proxmox VE node with a 16-core Xeon Silver, 256 GB RAM and approximately 14 TB of usable storage<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Migration: <\/strong>all three production VMs moved within one planned extended maintenance window using Proxmox VE\u2019s native ESXi import tooling<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Automation: <\/strong>around 90% of the infrastructure configuration applied without manual intervention through Ansible<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Managed operations: <\/strong>Zabbix monitoring, Splunk log collection, Veeam off-site backup and AD-backed access with 2FA<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Platform subscription: <\/strong>\u20ac1,100\/year for Proxmox VE Premium, compared with approximately $3,500\/year modelled for VMware<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Result: <\/strong>approximately 64% lower annual virtualization licensing costs with a predictable subscription cost based on a single occupied socket, regardless of future core density<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Background<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/www.l4it.com\/\">Level IV<\/a> is a US-based company providing data-centre and related infrastructure services to its customers.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Its aging VMware ESXi host was approaching end of life just as VMware\u2019s licensing model was changing. As part of our ongoing <a href=\"https:\/\/bonet.systems\/en\/vmware-alternatives\/\">VMware-to-Proxmox programme<\/a>, we designed and deployed a new single-socket Proxmox VE environment for its three production VMs.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">When a hardware refresh becomes a platform decision<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The existing VMware ESXi host had been in service well beyond the point where the customer was comfortable continuing to rely on the underlying hardware, particularly its storage.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A hardware refresh was therefore already planned. But the timing turned a routine server replacement into a broader platform decision.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Following Broadcom\u2019s acquisition, <a href=\"https:\/\/rcpmag.com\/articles\/2023\/12\/13\/broadcom-kills-vmware-perpetual-licenses.aspx\">perpetual VMware licenses were discontinued,<\/a> the portfolio was consolidated into subscription-based bundles and pricing became increasingly tied to physical core counts.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For a three-VM environment, the available VMware package represented significantly more functionality and cost than the customer required.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">With <em>vSphere Standard<\/em> discontinued, <em>vSphere Foundation<\/em> was the realistic option, estimated at approximately <strong>$3,500 per year<\/strong> for the replacement node, with the potential to increase if future hardware introduced more CPU cores.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Rather than automatically renew, the customer asked us to compare the five-year outlook of staying with VMware against a credible alternative.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">VMware vs. Proxmox VE for this environment<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The decision was not based on licensing cost alone. We compared both platforms against what this environment actually required: three production VMs, one physical host, straightforward storage and networking, and no dependency on VMware-specific technologies such as vSAN or NSX.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For this particular environment, Proxmox VE offered a better fit between the capabilities the customer actually needed, the infrastructure they wanted to operate and the cost model they wanted going forward.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>\u201cWhen the VMware renewal quote came in, we knew we needed an alternative. Now we pay one fixed price a year, and it won&#8217;t change no matter how our hardware grows.\u201d<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Eugene Rutberg, Partner, Level IV<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">The business impact: 64% lower licensing costs<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The new platform runs on <a href=\"https:\/\/www.proxmox.com\/en\/products\/proxmox-virtual-environment\/pricing\"><strong>Proxmox VE Premium<\/strong><\/a> <strong>at \u20ac1,100 per year for one occupied socket.&nbsp;<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Against the annual VMware estimate, this represents a reduction of around <strong>64% in annual virtualization licensing costs<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Premium was selected for the initial production period to provide the customer with the highest level of vendor support during the transition as it provides unlimited support tickets with a 24\/7 two-hour response time.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Potential for further savings<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">After the first year in production, the customer can reassess the required support level and consider moving to <strong>Standard (\u20ac550)<\/strong> or <strong>Basic (\u20ac370)<\/strong>, potentially increasing licensing savings to approximately <strong>85%<\/strong> compared with the original VMware estimate.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As the Proxmox subscription is based on occupied CPU sockets rather than individual CPU cores, the subscription would remain the same even if the current Xeon Silver were replaced with a significantly higher-core-count CPU in the future.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Migration<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The environment was well suited to a straightforward migration: one ESXi host, no cluster dependencies, no vSAN and no NSX. All three production VMs were transferred using <strong>Proxmox VE\u2019s native ESXi import tooling<\/strong> within one planned extended maintenance window.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The previous VMware server remained available until customer acceptance, providing a clear rollback option.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The migration was completed <strong>within the agreed maintenance window, with no unplanned downtime or major complications<\/strong>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">More than a VMware replacement<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The migration was not only about reducing licensing costs. It also gave us an opportunity to improve how the environment is configured and operated.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Around <strong>90% of the infrastructure configuration is applied automatically through Ansible<\/strong>, reducing reliance on manual setup. The new platform is also integrated into the customer\u2019s existing managed-service stack:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Zabbix<\/strong> for infrastructure and VM monitoring<\/li>\n\n\n\n<li><strong>Splunk<\/strong> for centralized logging<\/li>\n\n\n\n<li><strong>Veeam<\/strong> for off-site backup<\/li>\n\n\n\n<li><strong>AD-backed RBAC with 2FA<\/strong> for administrative access<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">The result is a more reproducible, observable and manageable environment.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Following a training session provided by our team, Level IV team quickly became familiar with the new platform.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What\u2019s next?\u00a0<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The current single-node architecture matches the customer\u2019s requirements today without introducing unnecessary complexity. If those requirements grow, the platform can be expanded into a <strong>three-node Proxmox cluster<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Additional automation is also planned to complement the existing Ansible configuration and extend infrastructure automation further.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Summary<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">What started as a routine hardware refresh became an opportunity to rethink the customer\u2019s virtualization platform.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The customer retained the same workloads while moving to a platform with <strong>64% lower annual virtualization licensing costs<\/strong>, greater automation and a clear path for future growth.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For organizations approaching a VMware renewal or hardware refresh, the question may not simply be <strong>\u201cHow do we renew VMware?\u201d<\/strong> It may be: <strong>\u201cDoes VMware still make sense for the environment we actually run?\u201d<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>How a routine hardware refresh, forced by VMware\u2019s pricing shakeup, became an opportunity to reduce costs, modernise the infrastructure and simplify day-to-day IT operations. A US data center company had to replace an aging internal server just as Broadcom, VMware&#8217;s new owner, overhauled its pricing model.\u00a0 Renewing VMware on the replacement infrastructure was estimated at [&hellip;]<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[14],"tags":[],"class_list":["post-1404","post","type-post","status-publish","format-standard","hentry","category-case-studies"],"acf":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/posts\/1404","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/comments?post=1404"}],"version-history":[{"count":3,"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/posts\/1404\/revisions"}],"predecessor-version":[{"id":1407,"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/posts\/1404\/revisions\/1407"}],"wp:attachment":[{"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/media?parent=1404"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/categories?post=1404"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bonet.systems\/en\/wp-json\/wp\/v2\/tags?post=1404"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}