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Telecom operators around the world are reevaluating their infrastructure and virtualization strategies. One option is to continue to rely on proprietary hypervisors like VMware ESXi. However, 2024 Broadcom acquisition of VMware has fundamentally reshaped the virtualization landscape, with price increases ranging from 800% to 1,500%. AT&T followed suit and a proposed 1,050% price increase, yet another significant change that transforms manageable annual costs into crippling expenses. Beyond the pricing issues, Broadcom consolidated approximately 8,000 product SKUs into just two bundled offerings – VMware Cloud Foundation and vSphere Foundation – forcing customers to purchase entire suites rather than lean, purpose-built stacks. This limits operational agility and control.
Fortunately for telecommunications providers, Proxmox Virtual Environment (Proxmox VE) is emerging not merely as a budget alternative, but as a powerful, open-source platform ideally suited for the rigorous demands of NFV (Network Functions Virtualization). For telcos modernizing their infrastructure, this is more than a migration – it’s a credible way to design, operate and future-proof their virtualized networks.
Reimagining virtualization economics in telecom
One of the most compelling reasons for switching to Proxmox is cost predictability and transparency. VMware’s licensing model, particularly in light of subscription shifts, can impose steep and growing expenses. Independent analyses highlight that VMware’s pricing – especially when including add-ons like vSAN or NSX – can amount to thousands of euros per CPU socket annually.
By contrast, Proxmox VE is free to use, and its commercial support is entirely optional. According to cost breakdowns, support subscriptions for Proxmox start at a modest per-socket rate – a fraction of what many pay for VMware. One comparison suggests that migrating even a modest cluster could reduce annual virtualization operating costs by 80–90%.
For telco operators, these savings can be allocated into innovation initiatives – investing in more capacity, in automation, or in new services – rather than simply being used to pay for increased licensing overhead.
Performance that matches telco requirements
But simply cutting costs does not justify a platform change for carrier-grade environments. Performance must be taken into account – especially for network functions that demand low latency, high throughput and predictable industrial and organizational (I/O) behavior.
Proxmox VE demonstrates impressive performance advantages over VMware in storage-intensive workloads. In rigorous NVMe/TCP benchmarking, Proxmox outperformed ESXi in 56 out of 57 test cases, delivering close to 50% higher IOPS, over 30% lower latency, and 38% more bandwidth at peak load.
These metrics are not incidental – they stem from architectural differences. Proxmox/KVM relies on native Linux block devices and efficient I/O paths, bypassing layers that can introduce overhead in other hypervisors.
For telco workloads, like VNFs handling signaling, user plane traffic, or real-time packet processing, these performance characteristics are critical. Faster I/O, lower latency and higher throughput all contribute to lower service interruptions and higher utilization of hardware that enhance user experience.
Built-in, telco-grade scalability with software-defined storage
Beyond computing power, network functions require robust and scalable storage. Proxmox VE integrates tightly with Ceph, a distributed storage system that provides high availability, redundancy and scalability in a hyperconverged model.
Independent Proxmox–Ceph benchmarks show that, with enterprise-grade SSDs, Ceph can deliver excellent throughput and low latency in a Proxmox cluster. Other infrastructure tests, such as those that combine Ceph with caching layers like bcache, demonstrate very strong IOPS and bandwidth characteristics.
This architecture aligns well with telco NFV demands: a distributed storage layer that scales with computing power, supports replication and ensures resilience – all without vendor lock-in.
Strategic freedom and vendor independence
At its core, Proxmox VE is an open-source platform. This brings several strategic advantages for telecommunications companies:
- No per-core licensing lock-in – Operators avoid being tied to restrictive licenses keyed to CPU sockets or cores.
- Platform sovereignty – With source code accessible, operators retain full control over their virtual infrastructure, thereby enabling deeper customization, tighter integration and more predictable cost behavior.
- Flexible support – Paid support is optional. Companies can choose how much they rely on commercial backing versus in-house or third-party expertise.
This flexibility empowers network operators to redirect financial resources into innovation opportunities in 5G, edge computing, or next-generation virtual network functions.
Performance in real-world use cases
While not all public case studies focus specifically on telco NFV, organizations have seen demonstrable benefits from making Proxmox their virtualization backbone.
- Hosting companies and service providers migrating from VMware to Proxmox have reported major savings and consistent performance, which has driven down infrastructure costs dramatically.
- Infrastructure validators note that Proxmox installation is flexible: it supports both cutting-edge servers and older hardware, making gradual migration and hardware reuse simpler.
- In academic and benchmark settings, KVM-based hypervisors (like Proxmox) have proven to deliver near-native performance on CPU- and memory-bound workloads – an encouraging sign for VNFs that require high CPU efficiency.
Moving to Proxmox: risks, trade-offs and mitigations
No platform is without trade-offs – moving from VMware to Proxmox is no exception. But for telcos, the risks are often well understood and can be mitigated.
- Learning curve: Proxmox’s rich feature set sometimes requires deeper Linux familiarity. Teams used to vCenter might need to adapt.
- Enterprise tools gap: Whereas VMware has mature proprietary management tools, open-source ecosystems may require more integration work (though many community and third-party tools fill the gap).
- Storage behavior: Ceph performance – especially in smaller clusters or suboptimal configurations – can vary. Users in community forums point out that tuning is critical to avoid latency troughs.
- Shared storage constraints: Some setups migrating from SAN-based VMware architectures may need rearchitecting to fully leverage Proxmox’s model.
Yet, these are not insurmountable obstacles – they are manageable with planning, architecture validation and careful design.
The strategic case for telcos
For telecommunications operators seeking virtualization for NFV workloads, Proxmox VE offers a premium-grade, cost-efficient foundation. The key benefits are:
- Dramatically lower TCO: Open-source licensing significantly reduces capex and opex.
- Outstanding storage performance: Superior IOPS and latency translate into better responsiveness for virtualized network functions.
- Scalable, resilient architecture: Ceph integration enables hyperconverged models that scale to operator demands.
- Vendor freedom: Without per-core licensing and with optional support, operators are able to innovate without being held hostage by vendor roadmaps.
In a market where virtualization is the bedrock of NFV, edge deployments and 5G cores, Proxmox VE is not just an alternative – but a strategic enabler. For telcos seeking to reclaim control, scale smarter and invest in innovation rather than licensing, Proxmox offers a compelling path forward.
Virtualization is just one of many challenges facing telecommunications providers. In a dynamic – and incredibly competitive industry – it is vital to develop solutions that evolve with changing market needs and user expectations. That’s why telecom operators turn to Software Mind. For over 25 years our experts have been implementing tailored software that boosts offers and supports business strategies. Find out how our team can help you achieve your technical goals, deliver rewarding experiences for your customers and create new revenue streams. Get in touch by filling out this form.
FAQ
Why is virtualization so important to telecom operators?
Virtualization is critical for telecom operators as it facilitates Network Functions Virtualization (NFV), which enables them to decouple network services from specialized physical hardware. This transformation significantly reduces both capital and operating expenditures, while enabling the rapid deployment and dynamic scaling of new services, such as firewalls or load balancers, leading to greater network agility and resilience.
What are the differences between Proxmox and VMWare?
The core difference between Proxmox and VMware (vSphere/ESXi) lies in their approach to licensing and architecture. VMware is a proprietary, commercially licensed product that dominates the enterprise market and often requires separate licensing for its advanced management tools like vCenter. Proxmox, conversely, is an open source solution based on Debian/Linux, utilizing KVM and LXC, making it free to use with optional paid support. While VMware offers a vast ecosystem, Proxmox provides a highly integrated web management interface for both virtual machines and containers straight out of the box.
What are the advantages of Proxmox?
The main advantages of using Proxmox stem from its open source nature, primarily the elimination of high licensing costs. Furthermore, Proxmox offers integrated high-availability clustering and live migration features without extra purchases. Its use of both KVM for full virtualization and LXC for lightweight containerization provides superior flexibility and efficiency, all managed through a unified interface that also includes built-in backup and restore functionality.
About the authorJakub Kokoszka
For over five years Jakub has been delivering solutions for a range of companies, especially in the telecommunications industry. Passionate about Linux, Kubernetes and networking, Jakub excels at building robust, scalable solutions. Beyond his technical prowess, he has built a reputation for transforming complex system challenges into elegant, efficient workflows. A firm believer in continuous improvement, Jakub is eager to explore new frontiers in IT, while innovating and delivering results for companies across sectors.
