Five Ways to Help Companies Save on IBM Products

Five Ways to Help Companies Save on IBM Products


IBM licensing rules are complicated and may seem hard to interpret. Licensing rules are not the same across all IBM products which can leave companies not knowing how to make the most value for money out of their software assets. However, Elée will share 5 important ways that could help companies reduce drastically their license expenditures while staying compliant with the IBM licensing rules and agreement terms.


1-    Deploying and Maintaining ILMT

One of the most common licensing metrics for IBM products is the Processor Value Unit (PVU). The license entitlements for this type of metric can be calculated in two ways: full capacity or sub-capacity. The sub-capacity can lower the entitlements in terms of PVU in a substantial way because it takes into consideration the virtual cpu which unlike the full capacity, count the physical cores of the physical server. However, in order to be eligible for the sub-capacity, the company has to deploy and maintain (always upgrade) ILMT on all of its IBM environment servers. Not to mention, that there are several other important clauses in the Passport Advantage agreement which the company has signed that give a more thorough explanation on how to be eligible for the Sub Capacity and these clauses (and consequences in term of charge) have to be analyzed before opting for this calculation method.

What is ILMT?

The IBM License Metric Tool (ILMT) is an IBM software which allows the customer to track and manage the processor core capacity available to IBM PVU-based middleware.


2-    Maintaining the maintenance? Or not?

An important way to help any company make savings on license expenditures is to ask whether they really need to keep paying for the maintenance of an IBM product or not. Paying the yearly maintenance fee provides companies with a set of benefits, like the latest product version. However, it is often unnecessary and an older version may just be what the company needs. Nevertheless, this can be also risky in the event of an audit, especially if companies have ceased payment for maintenance fees but deployed a newer version of the product.

To be noted also that partial maintenance is generally not allowed. Therefore, companies cannot for example stop the maintenance for half the quantity of a product and keep paying the maintenance for the other half of this same product if the whole quantity of the product is deployed on a site. IBM explains this point as a “all or none” renewal requirement for each product per Site level.

If a client has 100 licenses of Product A installed at Site 123, and another 200 licenses for Product A installed at Site 345, they will get two renewal quotes, one from each Site. The client can renew all or none of the 100 licenses at Site 123, and can renew all or none of the 200 licenses at Site 345 – there is no requirement for them to have to renew S&S for all 300 or for none of them. [1]


3-    User Types and Roles

IBM provides options when it comes to user-based licensing for some of its products, including, authorized users, concurrent users or floating users. The first step to saving money would be to evaluate whether it is better to replace an authorized user by a concurrent user licensing. To do so, it is recommended that the company analyzes if its employees are connecting at the same times during the day or at different times. Then, the company can evaluate the assigned license roles granted to each user connecting to the application and analyze if the assigned role is appropriate (if the employee is using all the features given for this role), or a lesser role would be enough.

A monitoring of the usage should help company to reduce the associated cost by removing access of users who are not still using the software.


4-    Metric Switch

Some of the IBM products are available to be licensed under several metrics. Therefore, it is important to evaluate the break-even for each metric. The break-even is the number of licenses starting with which another metric would become more cost effective for the company. For example, when the number of authorized users becomes superior to a certain number, it is better to shift to a PVU licensing model rather than the authorized user licensing model.

However, switching metrics can also generate a higher risk. For example, a company decided to switch from a PVU metric to an Authorized User metric because the number of employees is not important, and switching to a user-based metric would make them save 30 000 euros. Nonetheless, the company did not do a proper estimation that the number of employees would increase in the coming years and the number of users accessing the software would become higher and consequently, the savings they did during the first year would become losses during the following years.

Thus, the switch should consider the usage evolution.


5-    Asking the Experts

Evaluating different ways to save on license expenditures can be a rather heavy work especially for big companies. Moreover, knowing all the licensing rules, contract terms and other specificities is not always easy to grasp. Therefore, companies can outsource this job to the Elee experts who can provide a professional team of consultants that will assist companies with this task.


Finally, it is important to note that the points written in this article are based on the current licensing terms which constantly change and can become irrelevant in a future date.


Ecrit par Joseph Abou Atmé

Consultant Software Asset Management



[1] Source:



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