A few days ago, VMware finally released the VSAN storage product to be used for productional use. A long time VSAN was in beta and public beta and there were rumors VSAN will never be really released for production.
Now it's there and becasue it's new to most of the vSphere admins, here are some basic information about this new technology.
VSAN is VMware's first own Software Defined Datacenter product that will complete VMware's vision of a completely software deifined datacenter. Software defined in VMware's view is any software that turns commodity hardware into feature-rich components that integrate optimally into other SDS componentes making the way for a highly integrated, intelligent and low-maintenance infrastructure.
The idea of VSAN isn't new, there are many vendors on the market that do nearly the same, that is converting internal storage in the hypervisor servers to a highly fault tolerant SAN. For example HPs StoreVirtual VSA or DataCore's VSA and even VMware's own VSA product do more or less the same. So why should anyone use VSAN? The answer is becasue VSAN is directly from VMware, integrates perfectly into the vSphere environment and really provides a way to a software defined datacenter where not only independence from hardware vendors is the main reason but rather optimally combining the ressources from the server virtualization, network virtualization and storage virtualization segments. Only that way you will end up in a really inetgrated environment. Sure, this will make you dependent from VMware but that is another thing.....
Back to VSAN. What does VSAN better than the already existing VSA? First, VSAN will not replace VMware's VSA at the very moment, it will be a parallel product. Second, the way VSAN works is different. The VSA is a VM running on top of the hypervisor, using already virtualized storage ressources to span a SAN across multiple hosts. VSAN integrates directly into the hypervisor so running separate VMs isn't neccessary anymore. Running directly in the kernel is also faster and needs less ressources. Additionally it should be much more stable.
VSAN uses any kind of internal storage and can also use SSDs for caching. "Can use" is not correct, you have to use at least one magnetic disk and one SSD in each hypervisor server contributing storage to the VSAN. There is also maximum for each disk type so capacity is limited per node. BTW, you can also add hypervisor servers to the VSAN that do not have any storage. These systems can still use the VSAN storage.
Replication traffic between the nodes in the VSAN cluster requires at least 1x1GbE link, 10GbE is preferred. If you want to learn more about VSAN, here is a very good ressource about it.
Regarding the price, VMware isn't known to be really "cheap". VSAN will be licensed per CPU socket in each hypervisor server contributing in the VSAN. The list price per CPU is 2500$ + 625$ for basic support for 1 year. As you normally have dual CPU servers and you have to have at least three servers in a VSAN (best practice is to use at least 4 servers in the VSAN to provide fault-tolerance in an event of one host failure and one host planned for maintenance downtime at the same time) you end up with license cost of ~25.000$. That isn't quite cheap at all.
More things to consider beside the price: VSAN can serve storage to other hypervisor servers in the cluster that do not have own storage. These nodes have to be licensed as well for VSAN. This is different from products like SimpliVity. Second, VSAN can only be used as a storage for vSphere hypervisors. It can't be exported and used by other servers in the SAN. So VSAN isn't a general purpose SAN, it's a vSphere hypervisor only SAN. This is a huge difference between VSAN and VSAs for example.
Last thing I want to mention here is the recommendation of the VSAN project team from the VMworld 2013 in Barcelona. They recommended to use VSAN in it's first release (aka v1.0) only as a storage for test and development or simple VDI environments. They don not recommend it to be used as a production SAN. Well, in my opinion, buying a 25.000$ SAN and getting told to use it only for R&D purpose is a bit of wasted money.
Hope VMware will bring out v2 of the VSAN quite fast and make it a stable and fast storage solution. With the integration possibilities into their hypervisor stack and the vision of VMware for the Software Defined Datacenter, VSAN is the first step towards a fully integrated datacenter design.