With Microsoft positioning Hyper-V as a nearly-zero cost alternative to VMware, Parallels releasing update after update to their impressive Virtuozzo product, and Citrix jumping in the game with compelling pricing on Citrix XenSource, I'm growing ever amazed at the pricing decisions currently being made by VMware.

VMware recently announced changes to its pricing structure that could potentially screw existing customers. At the same time VMware's prices are going up, everyone else's are going down. I wrote about those changes here. If you are a current VMware customer, you should definitely take a look at this post. You may be in for some sticker shock if you've got a high core count on your hosts.

From a recent article on SearchServerVirtualization.com:

"They're very hard to negotiate with," Enck said. "Customers don't feel they're getting the recognition they deserve for making a long-term commitment."

The best deal VMware typically extends customers is a two-year enterprise license agreement, which extends out over the time of the Microsoft Hyper-V launch, Enck said. Microsoft's entry in to the market, however, will probably force VMware to lower its pricing, which could spawn further resentment on behalf of customers locked into unfavorable enterprise license agreements.

"We feel that VMware may be setting itself up for a second wave of dissatisfaction," Enck said.

What are your opinions? Is ESX really worth all that money? Are these tactics in the end spelling a strategy shift by VMware that could drive customers elsewhere? Is the era of VMware's hegemony on the virtualization space over? Let us know...