If you use software and certain online services, you need to make sure that you have the correct and up-to-date licenses for them.
Also, regular checks should be made to ensure that you are not paying license fees for software and services that you no longer use.
Both of these scenarios can save your business financially; you are either potentially facing software compliance fines or you are spending money that you don’t need to.
Over time, business processes change, and with them, software requirements adjust and alter, so whether its applications hosted on your own servers, cloud-based applications or Software as a Service (SaaS) you need to regularly audit in order to remain compliant.
Many software providers do ensure that appropriate licenses are purchased, however, there are often differences in the types of license available and regularly companies have the wrong kind and so run the risk of being financially penalised.
As an example, if a user moves their software services to servers with a higher power rating, they may incur increased license costs without realising the implications.
Another scenario is when software is uploaded to test and development servers, most users do not realise that a further license is required for certain products which don’t include non production environments in their license entitlement usage.
On the other hand, when software is uninstalled or no longer required, license costs will continue to be paid unless they are cancelled.
Changes in software license requirements may also arise from organisational restructure or even reallocation of resources.
Juggling with jargon
A further complication in the IBM licensing model is the way it categorises its products and licenses.
Products are categorised as;
- Infrastructure Software
- Operating Systems
- Development Tools (Rational)
- Databases (IBM DB2)
- Middleware WebSphere
- Watson Customer Engagement (Marketing & E-commerce)
- Analytics (Cognos, TM1 – Planning Analytics, SPSS)
- Network/Systems Management
License models include;
- Authorised User
- User Value Units
- Processor Value Units
- Resource Value Units
Other licensing arrangements that you should be aware of;
- Full capacity licensing – where sufficient licensing is required to cover all physical processors that actively run within the server where the software is installed.
- Sub / virtual-capacity licensing – a software license covering less than the full capacity of the server or group of servers, required when using multi-core chip and virtualisation technologies. In this situation IBM’s ILMT (IBM License Metric Tool) must be used to monitor and report on the license usage.
Details of these different license models can be found on the IBM website
As you can see, the number of license options and variety of terms can leave all, but the experts confused.
What is the cost of incorrect licensing?
The penalties for holding an incorrect license can be significant. If IBM audit a company and they are found to hold insufficient licenses, the non-compliant organisation will, as an example, have to pay at least two years of punitive maintenance and any license shortfall.
This can lead to a falling out between the vendor and the customer, damaging a relationship that would otherwise be beneficial to all concerned. It is vital to understand the full details of the legally binding license agreement that you have with your software vendor.
Licensing – it’s not just money for old rope
IBM are not the only supplier to review their customers’ licenses, all software vendors invest a lot of time and money in creating software solutions to help their customers thrive in business.
They want to see some return for this investment, and this is delivered through licensing their products.
The majority of software vendors will work with you to ensure that you remain license compliant, IBM for instance have their License Metric Tool which is available free to IBM Passport Advantage® clients.
This tool will help them determine the consumption of processor value units (PVU) for their IBM full and sub-capacity software. It also produces a report that can be used for the IBM license audit. They are providing a tool to help their customers conform to license requirements.
You’re not on your own!
License management is complicated and can prove costly if not managed correctly, this is why we recommend that you work with a trusted partner, someone you trust and rely on to take care of your software license agreements and quite often save you money.
Initially you will need to undertake an independent license audit, this will create a full review of the software being used alongside the associated licenses to ensure and determine full compliance is in place.
The review will also identify any shortfalls plus opportunities to utilise software more effectively and importantly, areas where savings could be made.
The final audit report can be used to provide evidence to the software vendor (developer) that license compliance is in place.
If compliance issues are highlighted then it is often possible to find alternative software solutions or licensing options sometimes on the same platform and from the same vendor, this regularly uncovers better software optimisation and cost savings.
We are an IBM Premier Partner and are positioned to be able to perform independent IBM software license audits mainly due to our IBM licensing system knowledge and experience.
We currently work with a number of other software developers too, so our license audits are not necessarily limited to just IBM systems.
We have processes that help you manage your hardware and software assets, identify risks and ultimately reduce costs.
If you would like to find out more about our Software License Management services, please get in touch by calling 0114 399 2820 or emailing [email protected]
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