I guess the recommendation about CSVs and software writers is from the WS2008R2 days, in WS2012 the software provider has really very few disadvantages, especially compared to the crappy hardware providers that some SAN manufacturers deign to inflict upon their users (Dell MD3260 users here).
We backup two ~ 25 TB CSVs in software mode right now, though we don't have many VMs on them, just a few, but a couple of those with 16 TB+ VHDXs attached. It actually works pretty well, but:
01) if you are using Windows Server 2012, be very, very careful about the CSV bug (best described here
) which was fixed at first with a hotfix that had a bad memory leak, now somewhat more stably fixed with version 2
, but still not perfect, Microsoft themselves say they have discovered other bugs creeping around the CSV backend, which supposedly will all be fixed in Version 3, due out sometime in May(be). You also need to disable ODX (even with V2 of the hotfix(, since having it enabled makes the existing bugs cause problems more often
02) the software provider does seem to have issues with VMs that are doing disk intensive stuff when backed up, we have a couple that sometimes fail in Veeam at first, and get backed up on second or third try, but this seems to be like I said strongly correlated with disk heavy stuff inside the VM itself