How we migrated 550 VMs from VMware to XCP-ng

When Broadcom acquired VMware and promptly overhauled the licensing structure, one thing became clear: the business model that had kept our data centre running for years was no longer viable. Not for us, and not for the thousands of cloud workspaces we host for our customers. This is the story of how we moved 550 virtual machines — across roughly 20 hosts — from VMware to Vates VMS (XCP-ng).

*Today Vates published an article about our migration. Time to share our own perspective.*

The trigger: Broadcom and the VMware licensing shock

In early 2024, Broadcom announced a radical shift in VMware licensing: bundles only, much higher minimum commitments, and the end of the perpetual licenses our infrastructure had been built on. For a Managed Service Provider like us — with hundreds of customers, thousands of cloud workspaces and strict cost models — it meant a potential cost explosion.

We had two choices: pass the costs on to customers (not an option — SMBs can't absorb 2-3× higher IT costs for no reason), or tighten our own belts and find an alternative. We chose the latter.

Why XCP-ng and Vates VMS?

We seriously evaluated multiple hypervisor alternatives: Proxmox, Hyper-V, Nutanix and XCP-ng (the open-source Xen-based platform commercially supported by Vates). Our criteria:

• Production-ready for 550+ VMs in multi-tenant setup — no hobby project
• Migration path from VMware without per-VM downtime — customers notice nothing
• Management at scale — we need a single pane of glass, not a dashboard per host
• European vendor — GDPR compliance and a supply chain free of US dependencies
• Open-source core — no repeat of the Broadcom trap five years from now

XCP-ng plus Xen Orchestra (Vates' management appliance) scored on each of those points. Vates itself turned out to be a French outfit with fast support, an active open-source community and commercial service contracts that give us the safety net we need in production.

The migration: months of work, no big bang

We're a production environment. A downtime weekend where we "just flip" 550 VMs is out of the question. The migration was therefore phased across several months in the second half of 2024.

Technical highlights:

• One host at a time — new XCP-ng hosts alongside the existing VMware cluster
• Per VM: Xen Orchestra's built-in VMware import did the heavy lifting
• For legacy VMs, BIOS → UEFI conversion on the VMware side first (otherwise boot issues on Xen)
• Legacy driver cleanup (old VMware Tools, outdated NIC drivers) before migration
• Test, adjust, next wave — always room to roll back

No VMs were lost, no extended outages occurred. In most cases customers never noticed that their workspace was running on a completely different virtualisation platform underneath.

What it delivered

More than a year after the first live migration, we can take stock:

1. Significantly lower infrastructure cost. We use part of the savings to add extra hosts: more redundancy and capacity for our customers, at unchanged prices.

2. Faster support. Vates responds in hours, not days. Open a ticket with Broadcom-VMware enterprise support and you never know when an answer arrives. With Vates you talk to engineers.

3. Simpler platform. XCP-ng is lean. New colleagues ramp up faster — the learning curve is dramatically shorter than VMware vSphere with its sprawling product suite.

4. Equal or better performance. Our VMs on Xen run on par with or faster than on ESXi, depending on workload.

5. Vendor independence. Because XCP-ng is open source, we're no longer vendor-locked. If Vates tripled their prices tomorrow, we could continue independently.

What our CTO says

Mohammad Moghtader, CTO at Virtual Computing, in the Vates article:

*"The VMware licensing changes were the trigger. The low costs have helped getting extra hosts. The simple learning curve has contributed positively to training new colleagues faster. What I do like about Vates is the support but also the open community principles. If you don't have time to do a migration, definitely choose Vates."*

What this means for our customers

Nothing noticeable at the front, a lot behind the scenes. The workspace you log into every morning is still the same fast, secure, Microsoft-powered environment. But the underlying virtualisation layer has been replaced by a platform we control, where costs are predictable, and where no Silicon Valley acquisition drama can upend our pricing.

For customers considering leaving VMware and thinking it's impossible: it isn't. Plan it, take your time, use the right tools. And if you'd rather not do it yourself — we're happy to help. We've now travelled the road 550 times.

Want to know more?

Curious about our infrastructure, our Vates choice or the thinking behind hypervisor migrations? Get in touch — we'll happily share more. Or read the Vates article for their perspective: How Virtual Computing migrated 550 VMs to Vates VMS.