VMware has finally revealed prices for its NSX network overlay software, about eight months after the product was made commercially available.
Enterprises have a choice of buying a perpetual or term license for VMware NSX. The perpetual license starts at $5,996 per server CPU -- or socket -- and the term license is $34 per virtual machine (VM) per month with available volume discounts. Those volume discounts on the per-VM prices presumably will drop to single-digit dollars, if what VMware spokesmen told us back in October still holds.
VMware NSX price: Expensive or a steal?
Compared to the other overlay network software products on the market, VMware NSX is expensive. Juniper charges by the server socket for its Contrail overlay software: $1,000 for a one-year subscription or $1,700 for a perpetual license. Midokura charges an annual subscription of $500 per server host. Alcatel-Lucent subsidiary Nuage Networks has not published prices for its overlay software. All of these vendors will argue about how much you get for your dollar with these overlays in an attempt to mitigate the difference in price.
Meanwhile, Cisco recently announced the Application Virtual Switch, which enables the creation of an overlay extension from its hardware-centric Application Centric Infrastructure (ACI), but enterprises can't deploy a pure ACI overlay. They have to buy a minimum of four Nexus 9000 switches when deploying ACI. It's not possible to compare prices between an overlay extension to a hardware-centric Cisco product and a VMware software overlay. However, Cisco marketing people have stated in the blogosphere that an enterprise can get started with ACI for $125,000, which covers the price of two Nexus 9336PQ spine switches, two nexus 9396 leaf switches, ACI licensing and a controller cluster.
You can compare Cisco's $125,000 ACI starting price to VMware's ability to virtualize a network of 48 hosts, which is probably equal to how many physical hosts you would plug into an ACI leaf-and-spine network as described above. If those 48 hosts each have two CPUs, an enterprise would face a list price of $287,808 for a perpetual license. Presumably that overlay would run on an existing physical network fabric.
There are several important caveats to this comparison. First, VMware's prices are list price and don't account for any discounts that an enterprise might negotiate. The Cisco price is a "street price," implying that it reflects some sort of discount. List prices for ACI are not yet fully available. It's also important to consider that VMware NSX has been shipping since October, and since it is all software, VMware customers can start with as small an overlay as they want. For instance, they may want to start with just four hosts. Meanwhile, Cisco's ACI architecture costs at minimum $125,000 and won't be fully available until later this year.