How to Reduce VMware Licensing Costs and Build a Smarter AWS Migration Plan

Executive Summary

• Broadcom’s subscription-based licensing replaces perpetual models, which drives higher recurring costs and stricter renewal terms.
• The 16-core minimum and bundled product tiers increase baseline spend while reducing flexibility for smaller environments.
• VMware Cloud on AWS is no longer resold by AWS; organizations either remain on-prem with Broadcom-supported VMware or migrate to AWS-native services. The new AWS Elastic VMware Service (EVS) still requires a VMware Cloud Foundation Subscription.
• AWS-native migration delivers the lowest long-term cost through elasticity, automation, and native observability.
• Nova Cloud provides bridge support, asset relief, and AWS migration planning to help you regain cost control and operational stability.

See how Nova Cloud helps you regain cost control. Schedule a consultation today.

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Broadcom’s shift to a subscription-based licensing model has left many IT leaders rethinking how they manage VMware costs and long-term commitments. Renewal terms now carry tighter rules, higher minimums, and limited flexibility. That pressure hits both your operational budgets and your migration timelines.

In this article, you’ll see how these changes affect your financial control. We'll also discuss what practical steps you can take to plan a smoother, lower-risk path to AWS.

Let's get started!

What Are the New VMware Licensing Changes in 2025?

The VMware licensing model has changed dramatically in 2025. Broadcom replaced perpetual licenses with a subscription model, consolidating products into large bundles. These changes redefine how you plan, renew, and budget for infrastructure.

End of Perpetual Licenses

Broadcom has ended all new perpetual license sales. You can keep using existing ones only until their active support contracts expire. After that, renewals shift to the new subscription framework.

This shift moves your VMware spend from a one-time CapEx model to recurring OpEx costs, which raises baseline expenses even for unchanged workloads. It also limits how long you can delay migration decisions since renewal timing now determines your licensing terms.

The 72-Core Minimum

Broadcom briefly proposed a 72-core minimum for new VMware subscriptions starting in April 2025. Under this change, each VMware product instance would have required a minimum of 72 licensed cores, so even a server with just 20 cores could have counted as 72. 

This new model would have replaced the pay-per-CPU with a 16-core minimum.

As such, smaller data centers or edge environments would have ended up overpaying for unused capacity. This change would have hit organizations running lean private clouds the hardest, which would have forced unnecessary scaling just to meet compliance thresholds.

This policy immediately sparked backlash from VMware partners and customers. Following industry criticism, Broadcom retracted the 72-core minimum, reinstating the 16-core minimum for multi-annual contracts.

Still, the brief policy shift highlighted how volatile VMware’s new pricing and renewal structures can be, especially for organizations running lean private clouds.

Bundles and Renewal Penalties

The new Broadcom product portfolio simplifies SKUs but reduces flexibility. Bundles like VMware Cloud Foundation combine compute, storage, and networking features under one license, even if you don’t need all of them. Of course, not all VCF bundles include everything, and Broadcom licensing changes are still evolving.

Late renewals can trigger penalties of up to 20% and push you into multi-year terms that limit cost agility.

These shifts reshape your total cost of ownership and force a forward-looking approach to renewal strategy. You now need clear cost forecasting, flexible licensing options, and migration planning well before renewal windows close.

How Much Will VMware Licensing Cost Under Broadcom?

VMware licensing is likely to cost around 60% more over a typical seven-year lifecycle under Broadcom’s new subscription services model compared to the previous perpetual setup. The shift raises baseline costs, limits renewal flexibility, and introduces hidden financial risks that can catch even well-prepared finance teams off guard.

The Real Price of Subscription-Based Licensing

The move to a full subscription services model means you now pay recurring fees for the same workloads you previously owned outright. While that may sound simple, the long-term math tells a different story.

Over seven years, organizations are seeing cost increases of about 63%. These costs vary depending on your core counts, contract terms, and usage patterns, but they rarely go down.

Here’s what that means: your predictable CapEx spend has turned into an expanding OpEx commitment that renews automatically unless you plan ahead.

The Hidden Costs Beneath the Surface

Subscription costs aren’t the only expense rising. Many customers report more aggressive license compliance checks through partners under Broadcom’s new model. Late renewals can trigger penalties for the first-year subscription.

You may also face inflated bills from bundled products like VMware vSphere Foundation, which combine compute, storage, and network features whether you use them or not. Luckily, the new per-core licensing rules that would have forced many smaller on-premises infrastructure environments to pay for unused capacity no longer exist.

Regaining Cost Control with Nova Cloud

This is where Nova Cloud’s third-party support changes the equation. It lets you extend support on your current VMware setup without rushing into Broadcom renewals. That stability buys you time to analyze your total cost impact, evaluate AWS migration paths, and build a roadmap toward more cost-effective solutions.

Can AWS Migration Reduce VMware Licensing Costs?

Yes, migrating to AWS can significantly lower VMware licensing costs. It can do this by replacing rigid, hardware-bound contracts with flexible, consumption-based pricing. Instead of paying for unused cores or forced bundles under VMware’s licensing model (which still enforces a 16-core minimum per CPU, even if your servers run fewer cores), you can shift workloads to AWS and scale costs in line with actual demand.

Keep Familiar Tools, Gain AWS Flexibility

Migrating to AWS Native means fully exiting VMware’s tooling ecosystem, so you won’t rely on vSphere, vSAN, NSX, or vCenter anymore. Instead, your teams shift to AWS-native services such as: 

• EC2 for lift-and-shift workloads
• Fargate for containers
• Amplify for front-end hosting
• Other managed services purpose-built for scalability and cost optimization

The point is to avoid multi-year VMware renewals, eliminate licensing lock-in, and move toward a modern, cloud-first infrastructure. This infrastructure is simpler to operate and far more cost-efficient long-term.

Replace Fixed Commitments with Pay-As-You-Go

AWS operates on a pay-as-you-go model, so you pay only for what you actually consume. Compute, storage, and networking costs scale dynamically instead of being locked to pre-purchased licenses.

When you use services like Amazon EBS, S3, and Glacier, storage costs drop compared to traditional on-prem arrays. This approach transforms how you budget for IT. You convert large upfront renewals into Agile operational spend that you can track and adjust in real time.

How Nova Cloud Makes It Work

As an AWS Advanced Partner, we handle end-to-end migration services, from cost assessments to AWS MAP funding alignment. This can help you reduce upfront expenses and plan the move with precision.

A good example is Brightfield, one of our clients facing a $500,000 annual Oracle renewal. We worked backward from their renewal date, migrated them to AWS ahead of schedule, and achieved full savings with zero downtime. That same model helps you act before Broadcom renewals lock you in, which allows you to gain cost control and flexibility fast.

VMware Licensing Costs vs. AWS Native: Which Costs Less?

AWS Native generally costs less over time, but the right choice depends on your Broadcom licensing renewal, your hardware refresh cycle, and how your workloads scale. Broadcom’s new subscription model introduces higher fixed costs, while AWS aligns spend with actual usage.

Comparing Cost Models

• Stay on-prem VMware (renew Broadcom subscription): This means absorbing the 16-core minimum per CPU, multi-year commitments, and bundled product tiers. This option preserves your existing environment but increases year-over-year baseline spend and reduces flexibility.
  
  
• Migrate to AWS Native (remove VMware entirely): Refactoring workloads into AWS Native removes VMware licensing and Broadcom renewals from the equation. Costs scale with consumption and can go up or down based on business demand. You trade fixed subscription obligations for usage-based pricing and avoid Broadcom’s 16-core minimum completely.

Here’s where your real savings come from:

• Eliminating VMware licenses and Broadcom’s multi-year renewals
• Avoiding forced over-licensing under the 16-core minimum
• Leveraging AWS elasticity to scale resources dynamically
• Using FinOps dashboards for full cost transparency.

Use Nova Cloud to Strengthen Cost Visibility and Control

At Nova Cloud, we can help you track, forecast, and optimize every dollar across compute, storage, and virtual-server layers. Our FinOps practice uncovers waste in VM sprawl, hypervisor licenses, and cloud infrastructure usage.

Meanwhile, we can implement observability tools to give you real-time visibility into performance and cost drivers. With Nova Cloud, you reduce unnecessary spend and improve financial predictability without adding operational overhead.

We combine our FinOps expertise and observability tools to help you choose the right model. This approach balances cost efficiency with performance continuity without losing control during transition.

Talk to Nova Cloud to map your VMware costs and plan a low-risk path to AWS. Our experts help you stabilize today and migrate on your terms.

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How to Prepare for VMware to AWS Migration

Moving from VMware to AWS is a strategic decision that affects budgets, performance, and continuity. To make that shift without risk, you need a structured plan that turns migration into a predictable, low-disruption process.

These are the four steps we follow with every client to help them transition confidently and maintain control from day one.

1. Assess

Begin with a full inventory of workloads, dependencies, and compliance requirements. From there, map how applications connect, which data they handle, and which licensing terms still apply. This step usually reveals underused vSphere licenses and opportunities to consolidate workloads before migration.

Once that groundwork is complete, conduct a compliance analysis to identify where licensing or regulatory risks could surface. With your baseline in place, you can then calculate the real cost of migration against renewal timelines.

2. Mobilize

Next, align your technical and financial teams around a single plan. Design your AWS landing zones with security, scalability, and governance in mind.

This phase is also when you secure AWS MAP funding, which offsets migration costs and gives you a defined financial runway. Strong coordination at this stage prevents fragmented decision-making and reduces the chance of rework later.

3. Migrate

Move workloads in controlled phases using AWS tools such as Application Migration Service (MGN), Database Migration Service (DMS), and Migration Hub. To reduce risk, each phase should include rollback plans so you can revert safely if issues arise.

Migration can help you keep business continuity intact. With a phased model, you can validate performance, storage efficiency, and compatibility at each stage before scaling further.

4. Modernize

Once workloads are stable on AWS, start optimizing. Use containers, serverless platforms, and native cloud services to cut infrastructure overhead.

For example, software-defined storage and managed databases replace costly hardware maintenance and licensing renewals. Over time, this phase transforms your environment from reactive to proactive (focused on growth instead of maintenance).

At Nova Cloud, we specialize in safe, low-downtime migrations that balance speed with precision. As an AWS Advanced Partner, we combine deep migration expertise with ongoing FinOps and observability support, so you stay in control of both costs and performance at every step.

What Should You Avoid During VMware Migration?

The biggest mistakes during VMware migration happen when teams rush decisions, underestimate risks, and lose sight of cost control after moving workloads. Each of these can turn a planned optimization into an expensive and disruptive exercise.

So, let’s look at what to avoid and how to prevent it.

Don’t Rush Because of Renewal Deadlines

When renewal dates approach, it’s easy to feel pressured into quick migrations. But here’s the thing: rushed timelines typically create misconfigurations, unplanned downtime, and missed savings opportunities.

Without a clear migration roadmap, you might end up replicating inefficient infrastructure on AWS instead of optimizing it. Planning early gives you time to compare migration paths, secure AWS funding, and align your internal teams before contracts renew.

Don’t Overlook Compliance and Audit Risks

Many organizations underestimate the importance of licensing and regulatory compliance during migration. VMware workloads usually carry complex interdependencies that affect how data is stored, processed, and secured. Of course, the complexity depends on workload type (e.g., legacy monoliths vs containerized VMs).

Ignoring this exposes you to costly audits later. So, detailed mapping of workloads and compliance needs upfront protects both your data and your budget.

Don’t Overpay for Unused Bundles

Another common issue is paying for VMware bundles that include features you don’t need. Migrating those inefficiencies to AWS only shifts the waste, but it doesn’t necessarily remove it.

Before moving, assess which components you actually use and identify opportunities to consolidate or retire licenses. This simple step typically reveals immediate cost reductions.

Don’t Forget Cost Monitoring Post-Migration

Cost management doesn’t end after migration. Many teams neglect post-migration monitoring, which leads to rising cloud bills.

Without continuous FinOps and observability, it’s hard to track how resources are consumed.

That’s where our nearshore teams help. We provide you with ongoing optimization and cost governance so your AWS environment stays efficient and predictable.

At Nova Cloud, we’ve seen what happens when migrations happen under pressure. FullBeauty Brands faced a similar challenge with a $300,000 annual integration license due for renewal.

They partnered with us to migrate off that system to a serverless AWS platform within six months, which helped them cut costs to $50,000 a year. The same approach applies here. You need to act before renewals lock you in, and structure your move around measurable outcomes.

Why Choose Nova Cloud for VMware Support and AWS Migration

The difference between a smooth transition and an expensive one comes down to control over contracts, timing, and long-term costs. That’s exactly where we come in. At Nova Cloud, we help you stabilize your VMware environment, plan your migration with confidence, and keep your AWS spend predictable once you’re there.

Here's what you'll get with us by your side.

VMware Bridge Support: Breathing Room to Plan Strategically

Forced renewals can trap you in multi-year contracts under Broadcom’s new terms. Our services prevent that.

We extend managed support for your current VMware stack (assuming you hold the required licenses) so you can maintain operational continuity while you assess the right migration path. This gives you breathing room to assess your infrastructure, model AWS costs, and choose the right migration path without the pressure of looming deadlines.

Asset Relief: Unlock Capital and Remove Hardware Barriers

For many organizations, the biggest blocker to AWS migration is hardware. What do you do with servers, storage arrays, and networking gear you’ve already invested in? And how do you fund a modernization project while capital is tied up in equipment you plan to retire?

Nova Cloud and its partners solve this with Asset Relief.

We buy out your existing infrastructure and lease it back to you for the duration of the migration. This delivers three enterprise-grade advantages:

1. Immediate access to capital: You get day-one liquidity that can offset migration and modernization costs.
   
   
2. A clean shift from CapEx to OpEx: You eliminate the financial drag of aging hardware while aligning costs with actual usage.
   
   
3. A responsible post-migration exit path: We handle the hardware you no longer need once workloads are fully moved to AWS.

Asset Relief becomes the bridge between where you are and where you’re going: modern infrastructure, predictable costs, and no stranded assets slowing down your cloud strategy.

AWS Migration Planning and Execution

As an AWS Advanced Partner, we don’t just lift and shift workloads. We map out each phase (assessment, mobilization, migration, and modernization) based on your business priorities. Every plan includes rollback options and validation checkpoints to ensure low downtime and smooth continuity.

Our engineers have guided clients through complex migrations where timing and precision were critical. This helps turn what could have been a high-risk transition into a controlled process with measurable outcomes.

Post-Migration Optimization with FinOps and Observability

Migration is only half the journey. The real savings come afterward. With Datadog-powered observability, we monitor workloads, track performance, and pinpoint inefficiencies in real time.

Our FinOps team then translates that data into clear, actionable insights for cost control. With us, you gain visibility into usage trends, reserved instance planning, and scaling opportunities so your AWS costs remain predictable.

Take Control of Your VMware and AWS Strategy with Nova Cloud

Broadcom’s licensing changes don’t have to dictate your next move. With the right plan, you can regain control over costs, timelines, and infrastructure decisions.

AWS gives you flexibility, but it’s the preparation and execution that determine long-term value. That’s where Nova Cloud steps in by bridging VMware and AWS with proven migration frameworks, cost governance, and post-migration visibility. Our team helps you act with confidence rather than urgency.

Start the conversation with Nova Cloud today to plan a migration that protects both your performance and your budget.

FAQ

What are the biggest VMware licensing changes in 2025?

The biggest VMware licensing change in 2025 was the full shift to subscription-only licensing. Luckily, the introduction of 72-core minimums per product instance was retracted, though there is still a 16-core minimum requirement. Products were also consolidated into larger bundles, which reduces flexibility and increases baseline costs.

How much more expensive are VMware subscriptions vs. perpetual licenses?

VMware subscriptions are about 60% more expensive over a typical seven-year lifecycle compared to perpetual licenses. The difference grows when you include renewal penalties, forced bundles, and unused core capacity (due to the 16-core minimum).

Can I delay migration with bridge support?

Yes, VMware Bridge Support lets you extend your current VMware environment without renewing under Broadcom’s new terms. It gives you time to plan your next steps and budget migration properly instead of rushing decisions.

How does AWS MAP funding reduce migration costs?

AWS MAP funding offsets a portion of migration and modernization costs through credits and incentives. This lowers your upfront expenses and allows your team to reinvest savings into optimization and innovation.

What’s the safest way to migrate VMware workloads to AWS?

The safest path is a phased migration using tools like AWS Application Migration Service (AWS MGN), Database Migration Service (DMS) and Migration Hub for controlled transitions. Also, partnering with Nova Cloud ensures expert planning, rollback options, and low-downtime execution from start to finish.