VMware Perpetual vs SnS vs Subscription vs SaaS

VMware Perpetual vs SnS vs Subscription vs SaaS

As VMware move more and more licensing to a subscription model one question I’m getting asked more frequently is “what is the difference between VMware Perpetual vs Subscription vs SaaS vs SnS?” and “what is the best way for my organisation to purchase licensing from VMware now?”

Below is a quick overview of the different licensing definitions along with an overview of when an organisation might use them.

Perpetual

This is the most well understood VMware model as it’s the most widely used. A perpetual license allows an organisation to use the software for as long as the end user complies with all terms of the license agreement.  Which could in principle be in perpetuity.  When an organisation buys a perpetual license they are effectively buying the entitlement to run the version of the software they purchased forever.  The key part of the previous sentence is ‘the version of the software they purchased’, to upgrade a perpetual license to the latest version of the software an organisation would need to purchase an upgrade.

This is where VMware SnS comes in.

‘SnS’ or ‘nS’

At VMware SnS stands for Support and Subscription.  The support part of that entitles and organisation to request help from the excellent VMware Global Support teams.  The subscription part grants an organisation upgrade permissions. With a perpetual license an organisation can purchase bolt on support services and upgrade rights.  Often both are purchased together as part of a support contract, that is most likely referenced as SnS, it is however possible to purchase licensing with Subscription Only part to maintain upgrade rights without support services.

The Perpetual + SnS model works well for organisations that have a strong preference for a CAPEX method of purchase.  Purchasing in this way, perhaps tied to an ELA model could result in a ‘lumpy’ spending pattern, when viewed over a multi year period.

VMware Perpetual vs SnS vs Subscription vs SaaS

I’ve kept the numbers simple in the above chart and fixed SnS charges at 25% of license spend for illustrative purposes.  The chart is above is representative of a total spend of £1.925 million during a 4 year period.  Made up of an initial purchase of £750,000 in year one with associated SnS, two additional purchases in years 2 and 3 of £100,000 each and the renewal in year 4, with £400,000 of new licensing and the renewal on everything purchased in years 1, 2 and 3.

Subscription

A subscription licence allows the end user to use the software for a specified subscription period, so long as the end user complies with all the terms of the licence agreement.  I’ve seen this licensing model often referenced by other vendors as term licensing or a lease model.  With the subscription model there are no software assets owned as the agreement is a ‘lease’.  With subscription license models the SnS element is included in the price.

The Subscription model works well for organisations that have a strong preference for an OPEX method of purchase.  Purchasing in this way, with a subscription term commitment will smooth out any ‘lumpy’ spending patterns, when viewed over a multi year period.

If we where to look at the same spend above with a subscription model and a 3 year term then we would see the following.

VMware Perpetual vs SnS vs Subscription vs SaaS

 

This chart is modelling the exact same spend as above, but terming the payments over a period of three years.  We have the initial purchase of £750,000 + 25% SnS in a subscription term over 3 years, subscription pricing increasing as the two additional purchases in years 2 and 3 of £100,000 each are added.  Then the ‘renewal’ in year 4, with £400,000 requirement being added to the subscription model.  Indicatively over the same 4 year period the total spend is £1.625 million.

Both the Perpetual + SnS and the Subscription model describe licensing solutions that can be leveraged on-premises and in addition some license bundles also provide an entitlement to VMware SaaS solutions (vCloud suite).  This provides more choice about how an organisation wants to consume the services they’ve purchased.

SaaS

Software as a service (SaaS) is a software licensing and delivery model where software is licensed on a subscription basis, is centrally hosted and managed by the software vendor.  Delivered via public cloud services, SaaS is also available in an on-demand model.

From a purchasing and payment standpoint SaaS works much like subscription above, working well for organisations that have a strong preference for an OPEX method of purchase.  With SaaS part of the appeal is that an organisation will only pay for what is being consumed.  Unlike a term/subscription model when the commitment is made for the licensing over a period of years, SaaS solutions will generally offer pricing on a per function, GB, minute or hour basis.

For VMware SaaS offerings not only is the SnS elements included in the price, VMware will carry out the upgrades and manage the uptime of any platforms.

Summary

Having the choice to purchase solutions however an organisation wants to consume is really important.  Via the Perpetual, Subscription and SaaS offerings VMware can offer ways of purchasing that suit any organisation.  If you want to read more about the various VMware licensing offerings then I can heartily recommend the VMware product guide (link for March 2021) and the Product Licensing Metric Reference Guide as possible cures for insomnia.

Hopefully this is useful

Thanks

Simon