The vendor first discussed its plans to turn ESXi into freeware during its second quarter earnings call last week in what is seen as a defensive action against the likes of Citrix/XenSource and Microsoft, which recently launched its Hyper-V hypervisor.
By abruptly dropping its $495 ESXi licensing fee, VMware is clearly firing a shot across the bows of Microsofts $28 Hyper-V and the open-source Xen hypervisor.
"This has been a long time coming they knew that there would come a time when they couldnt charge for the hypervisor," says Chris Wolf, senior analyst at the Burton Group. "VMware had to ask themselves 'do we want to lose out in enterprises where price is a factor'?"
At least one user welcomed the move, citing its impact on his annual IT budget.