Key Takeaways
- The Broadcom acquisition has made VMware licensing more complex and less predictable for many organisations.
- There is no universal replacement for VMware; the right choice depends on risk tolerance, skills, and long-term direction.
- Proxmox Virtual Environment appeals where cost transparency and simplicity matter, but it requires a stronger in-house operational capability.
- Azure Stack HCI suits organisations already aligned with Microsoft and pursuing a deliberate hybrid strategy, not quick savings.
- The safest decisions focus on total risk and operational impact, not licensing cost alone.
For many organisations, VMware has been a stable foundation for on-prem virtualisation for years. That stability has been shaken by recent VMware licensing changes, prompting IT leaders and business owners to reassess whether their current setup still makes sense.
The question most organisations are now asking is not “What’s replacing VMware?” but “What’s the safest, most sensible next step for us?”
This guide walks through the realistic options available today, including Proxmox vs VMware, Azure Stack HCI, and broader cloud migration options, with a focus on risk, cost predictability, and long-term operational impact.
It’s also worth noting that some organisations explore other routes, such as Hyper-V–based platforms or fully cloud-native services, as part of this reassessment. In practice, these options tend to surface alongside broader infrastructure or application modernisation efforts, rather than as direct, like-for-like replacements for VMware.
Why the VMware Licensing Changes Have Triggered a Rethink
The Broadcom acquisition has altered how VMware is licensed, packaged, and sold. Broadcom simplified the VMware portfolio, but for many SMEs, this “simplification” has led to significant cost increases. A large number of standalone products have been collapsed into a smaller set of subscription bundles:- VMware Cloud Foundation (VCF): The full enterprise stack (vSphere, vSAN, NSX, Aria).
- VMware vSphere Foundation (VVF): The standard choice for mid-sized environments, including vSphere and vSAN (1 TiB per core).
- vSphere Standard & Essentials Plus: Lighter versions for smaller environments, but often lacking the advanced automation features of the larger bundles.
For many, the move to per-core subscription pricing means paying for enterprise-grade networking (NSX) or management (Aria) just to keep their basic virtualisation running. While VMware remains a powerful platform, many organisations have found that:
- Licensing is less flexible than before
- Costs are harder to predict
- Bundles no longer align cleanly with SME environments
- The platform is increasingly positioned for large enterprise use.
For many organisations, this has shifted VMware from a background concern to an active operational issue, particularly for teams relying on external managed IT support to maintain stability and cost control. Crucially, doing nothing is still a decision. Remaining on VMware may be the right choice in the short term, but it’s now a choice that needs to be actively justified rather than assumed.
Related Reading: Exploring Proxmox VE: A Practical Alternative to Hyper-V and VMware
Your Main Options After VMware
There’s no single “correct” replacement for VMware. In practice, organisations tend to fall into one of three paths:
Each comes with trade-offs.
- Stay on VMware, with adjustments
- Move to Proxmox Virtual Environment for simplicity and cost control
- Adopt Azure Stack HCI as part of a hybrid strategy.
Each comes with trade-offs.
Option 1: Staying on VMware (With Adjustments)
For some environments, staying on VMware remains the least risky option. This is often the case when:- The environment is complex or highly customised
- Operational teams are deeply experienced with VMware
- Workloads are tightly coupled to VMware tooling
- Short-term stability matters more than long-term flexibility.
However, staying put usually means:
- Re-evaluating the licence scope carefully
- Accepting higher or less predictable costs
- Planning for tighter audits and renewals
- Recognising that VMware may no longer be optimised for SME use.
This approach can make sense as a stabilisation move, but it should be accompanied by a medium-term exit or diversification plan rather than blind renewal.
At this stage, many organisations also assess tooling readiness. Migration and protection platforms such as VMware HCX, Veeam, or Zerto often shape what is realistically achievable, particularly where rollback, data protection, or phased transitions are required. Tooling constraints frequently influence strategy just as much as platform choice.
In practical terms, staying on VMware now typically involves:
- Audit Readiness: Ensuring your core counts align exactly with your new subscription tiers.
- VCF Portability: Taking advantage of the fact that VCF licenses can now be moved between on-prem and hyperscalers (like AVS).
Option 2: Proxmox Virtual Environment (For Cost Control and Simplicity)
Proxmox has gained significant attention as organisations compare Proxmox with VMware, particularly where cost control and transparency matter. The launch of Proxmox Datacenter Manager (PDM) has solved the management-at-scale problem that previously held Proxmox back.Proxmox appeals because:
- It’s open source, with a clear support subscription model
- PDM provides a single pane of glass for multiple clusters, mirroring the functionality of VMware vCenter.
- Licensing is straightforward and predictable
- You pay for support based on nodes, not a mandatory core-count bundle that includes features you don’t use.
- It covers core virtualisation and clustering needs well
- It removes dependency on complex enterprise bundles.
Where Proxmox works best:
- Small to mid-sized environments
- Organisations with strong Linux capability
- Teams comfortable managing more of the platform themselves
- Workloads that don’t rely heavily on VMware-specific features.
Where caution is needed:
- Fewer enterprise-grade ecosystem integrations
- A smaller third-party tooling landscape
- Support quality depends heavily on internal skills or partner expertise.
Proxmox is not a drop-in VMware replacement. It’s a different operating model, and organisations succeed with it when they plan for that shift rather than treating it as a like-for-like swap.
Option 3: Azure Stack HCI (For Hybrid and Microsoft-Aligned Environments)
Azure Stack HCI is often misunderstood. It is not simply “VMware in Azure,” and it is not a cost-cutting shortcut. It’s worth noting, though, that in some licensing scenarios, existing Windows Server Datacenter licenses with Software Assurance can offset part of the Azure Stack HCI host cost.Azure Stack HCI is best viewed as:
- A hybrid infrastructure platform
- Tightly integrated with the Microsoft ecosystem
- Designed for organisations already aligned with Azure and Microsoft 365.
It can make sense when:
- Microsoft tooling already dominates the environment
- Hybrid cloud management is a strategic goal
- Organisations want tighter integration with Azure services
- Long-term platform alignment matters more than short-term cost.
However, Azure Stack HCI requires:
- Strong operational maturity
- Comfort with Azure-linked licensing and management
- Acceptance of a deeper Microsoft dependency.
It rewards organisations that think in platforms and roadmaps, rather than those looking for a quick VMware replacement. Azure Stack HCI tends to make the most sense in environments already heavily invested in Microsoft 365, where identity, collaboration, and infrastructure strategy are closely linked.
Organisations already exploring AI-driven workflows or seeking Microsoft Copilot support often see Azure Stack HCI as part of a longer-term platform roadmap rather than a standalone infrastructure decision.
Proxmox vs VMware vs Azure Stack HCI: What Actually Matters
Feature comparisons rarely lead to good decisions. This is also why other platforms sometimes appear in early discussions, including Hyper-V or cloud-native services, even if they are ultimately ruled out once operational and risk factors are fully considered. What matters far more are the underlying trade-offs. Key questions to ask include:
- How predictable do we need our costs to be?
- What skills do we actually have in-house?
- How much operational complexity can we support?
- How important is vendor independence?
- What does our infrastructure need to look like in five years, not six months?
In many cases, the “best” option is the one that reduces long-term uncertainty, even if it isn’t the most technically impressive. In practice, these decisions are less about feature parity and more about how much complexity your existing IT infrastructure management model can realistically support.
Cloud Migration Options: Do You Move Everything?
The VMware licensing changes have also reignited interest in broader cloud migration options. For some workloads, moving to the public cloud makes sense. For others, it introduces new risks and costs.Common realities include:
- Lift-and-shift often costs more than expected
- Not all workloads benefit from cloud elasticity
- Data gravity and latency still matter
- Compliance and sovereignty requirements don’t disappear.
In many cases, organisations adopt selective Microsoft Azure solutions alongside on-prem platforms, rather than committing to an all-or-nothing migration. Many organisations end up with a hybrid approach:
- Some workloads remain on-prem
- Some move to Azure or other cloud platforms
- Virtualisation choices support both.
The mistake is treating cloud migration as an automatic upgrade rather than a case-by-case decision. Collaboration platforms like Microsoft Teams often surface early in these discussions, as performance, latency, and identity integration quickly expose whether a full cloud move is actually beneficial.
Related Reading: Nine Essential Steps to Migrate to the Cloud
How to Decide: A Practical Decision Framework
A useful way to cut through the noise is to assess each option against five practical factors:
- Business risk: what happens if this choice fails?
- Technical debt: how much legacy complexity are you carrying?
- Internal capability: who will run and support this day-to-day?
- Cost tolerance: how much unpredictability can you accept?
- Time pressure: are you planning or reacting?
If an option scores poorly in more than one of these areas, it’s usually a warning sign. For many organisations, this then becomes a strategic inflection point rather than a technical upgrade, often triggering wider strategic IT projects focused on resilience, cost predictability, and platform alignment.
Common Mistakes Organisations Make After the VMware Changes
The VMware licensing changes have created urgency, and urgency is where good decisions often start to unravel. Across many environments, the same patterns keep appearing. They’re understandable reactions, but they tend to create more long-term risk than they remove:- Rushing to Proxmox without the skills to support it
- Assuming Azure Stack HCI is cheaper by default
- Migrating workloads that are stable and low-risk
- Ignoring backup, recovery, and resilience implications
- Making infrastructure decisions purely on licensing cost
These patterns show up most often when licensing decisions are made in isolation from operational reality, and they’re rarely technical mistakes. They usually stem from pressure, uncertainty, and the understandable desire to “do something” quickly. The organisations that fare best are those that slow the decision down just enough to evaluate impact, not just cost.
During platform changes, backup and recovery are often overlooked, even though cloud backup services frequently need redesigning to match the new virtualisation layer.
How Nexus Can Help
Reassessing virtualisation strategy means choosing an approach that fits your organisation’s risk profile, skills, and long-term direction.Nexus helps UK businesses evaluate their options calmly and pragmatically. That includes reviewing existing VMware environments, assessing alternatives like Proxmox or Azure Stack HCI, and designing phased transitions that reduce risk rather than introduce it.
The goal is not to force a move, but to help you make a confident, informed decision about what comes next.
Book a free consultation to review your options and identify the right path forward.
Article Sources
- Broadcom. Broadcom Completes Acquisition of VMware. November 22nd, 2023
- Gartner. Market Guide for Server Virtualization Platforms. October 23rd, 2025
- VMware. VMware Product Guide. Accessed January 7th, 2026
- Microsoft. Azure Stack HCI solution overview. December 1st, 2025.