IBM license management knowledge, risks and management advice by Eric Chiu, HW Fisher. ITAM Review IBM & SAP Licensing Seminar, Tuesday 28th April 2015.

1. Premier Sponsor
IBM Licence Management
London Seminar
April 2015
ITAM Review IBM & SAP Seminar, London 28th April 2015

2. Premier Sponsor
The Speaker
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ Ex-licence audit manager at Deloitte, 200+ enterprise audits for IBM
§ Now leads FIAC, and is the Centre of Excellence on IBM matters
Eric Chiu
§ Part of HW Fisher, an 80-year old, top 30 accountancy in London.
§ Over 20 years experience in licence audit and advisory.
§ IBM Audit Defence, Internal Baseline and IBM LMO (License
Management Options) amongst most popular services FIAC offers.
Fisher IT Asset Consulting
Hwfisher.co.uk/fiac | licensing@hwfisher.co.uk | @auditdefence

3. Premier Sponsor
Agenda of the day
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ IBM software portfolio and core licensing metrics overview
§ Understanding IBM licence ownership
ESSO, PA and Legacy Contracts
§ Measuring IBM licence requirements correctly
PVU vs Everything else
§ Sub-capacity and your tools
ILMT and Third-party tools against contractual obligations
§ License Optimisation tips
Can money be saved?
Part 1 - IBM License Management
Knowledge, risks and management advice

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Agenda of the day
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ Global license compliance operation overview
§ Audit case studies
What happens when things go wrong
§ Audit workflow and defence tactics
How does audit work in real life, and how to manage every stage of the audit
§ An audit-free state
Understanding IBM License Management Option (LMO)
§ Self-Audit guides
Where to start
Part 2 – IBM License Compliance Audits
Understand and take advantage

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IBM: License management
knowledge, risks & management
advice
ITAM Review IBM & SAP Seminar, London 28th April 2015

6. Premier Sponsor
Portfolio Overview
ITAM Review IBM & SAP Seminar, London 28th April 2015
What are we dealing with
IBM offers over 31,000 application titles as of March 2015. Most of these
can be categorised into 5 main categories as below:
Information Management
• Data & Content Management: Cognos, SPSS, DB2, FileNet, Informix, InfoSphere
Lotus
• Communication & Collaboration: Domino, Sametime, Notes, Quickr, CEO
Rational
• Software & system development: Rational Application developer, IBM Rational Test Virtualization Server
Tivoli
• Service management: Tivoli Storage Manager, Composite Application Manager, TotalStorage,
Workload Scheduler
WebSphere
• System integration: WebSphere Application Server, WebSphere MQ, WebSphere Business Broker, Portal

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Charge Metric Overview
ITAM Review IBM & SAP Seminar, London 28th April 2015
Now you see why Discovery is nothing
IBM has 143 active licence metrics (charge metrics) as of March 2015.
By including legacy metrics the figure goes beyond 200.
Processor based
• Processor –> Core –> Processor Value Unit
User based
• Role based user: admin / advance / basic / limited use
• Tier based user -> Authorised User Value Unit (AUVU), EUVU
Concurrency based
• Concurrent users / sessions
Capacity based
• Terabytes
Device rating based
• Resource value unit

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Top 6 Compliance Risks
ITAM Review IBM & SAP Seminar, London 28th April 2015
What get you in trouble
6)
Virtualisation
5) User role
& access
definition
4) Server role
definition
3)
Multiplexin
g
2)
Application
specific
restrictions
§ “These are our Test/Dev
servers…”
§ “These servers are ran by our
service provider(s)…”
§ “I know how to count PVUs
so why ILMT”
§ “Computer says…”
Winner
The ‘But’

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Is it fair to call IBM a Bully?
ITAM Review IBM & SAP Seminar, London 28th April 2015
Debatable perhaps
Better price
discrimination
Built-in Licence
Control
Virtualisation Discount
Windows
Vs.
Vs.
Vs.
Vs.
Easy Licensing
DR Capability &
Security
Administrative
overhead
Unix

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Contract & Licence Structure
ITAM Review IBM & SAP Seminar, London 28th April 2015
Passport Advantage
Agreement
Passport Advantage Express
Legacy Agreements
EnterpriseSoftware&
ServicesOffering
Agreement(ESSO)
Contract Structure Licence Structure
Base Licence
with 12
months S&S
S&S Renewals
S&S Renewals
S&S Renewals
S&S Renewals
!
§ Base vs S&S count
§ Metric conversions
§ Trade-ups
§ Re-instatements
§ Legacy licences

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Raw Transaction
ITAM Review IBM & SAP Seminar, London 28th April 2015
What you (can) have

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Entitlement Position
ITAM Review IBM & SAP Seminar, London 28th April 2015
What you need

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Measuring Usage
ITAM Review IBM & SAP Seminar, London 28th April 2015
Think Strategically
Let’s start by scanning desktops and servers, maybe
with ILMT, and find out where my IBM applications
are installed, then go from there.
Let’s start by consolidating our license records to
understand what titles we have bought and under
which charge metrics, then determine the reporting
responsibilities and the associated data requirements
accordingly.
Because IBM installation counts rarely
relate to actual licence requirement

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Measuring Usage
ITAM Review IBM & SAP Seminar, London 28th April 2015
Top Down
Bottom up
then
What
we
have
bought
?
PVU
Non
-
PVU
ILMT Deployment & Validation
Bundling, coverage & accuracy
Additional Information
Required
Design Data
Collection
Methodology
to measure usage
according to charge
metrics
Manual
Calculation
ILMT
Update
& Sign-
off
Effective
Usage
i.e.
Licence
Required

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Measuring Usage
ITAM Review IBM & SAP Seminar, London 28th April 2015
What ILMT doesn’t tell you
Install Limitation
The total amount of resources allocated to a given Informix Install, including all database
instances managed by the Install, cannot exceed:
Processor Limit
The Program allows a maximum of sixteen (16) Informix CPU Virtual Processors (as reflected in
the NUMCPUVPS tunable parameter of the Program) per Install.
Memory Allocation Limit
The Program allows a total of sixteen (16) Gigabytes of memory allocated (as reflected in the
SHMTOTAL tunable parameters of the Program) to support use of all instances of the Program
on a single Install, regardless of the amount of physical memory in the physical server.
Licensee may use the Program up to a total of two (2) Secondary Install nodes, in any
combination using: High-availability Data Replication (HDR), Remote Secondary Server (RSS)
or Shared Disk Secondary (SDS).
Source: IBM License Information documents
www-03.ibm.com/software/sla/sladb.nsf/lilookup/461F2F1336373573852577B900760678?OpenDocument
Example: Informix Growth Edition | Concurrent Session | Licence Restrictions

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Measuring Usage
ITAM Review IBM & SAP Seminar, London 28th April 2015
Example: Informix Growth Edition | Concurrent Session | Data Requirements
What ILMT doesn’t tell you

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Sub-Capacity & ILMT
ITAM Review IBM & SAP Seminar, London 28th April 2015
What’s the PVU requirement for WAS?
Q1 Q2 Q3
400 PVU
800 PVU
200 PVU
Q4
Time
LPAR
decom
0 PVU
IBM Software: WebSphere Application Server
Deployment: 1 x VM, on a 1,000 PVU Physical Host

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Sub-Capacity & ILMT
ITAM Review IBM & SAP Seminar, London 28th April 2015
How ILMT works
Hardware
(PVU) Scan
Every 30 mins
Software
Signature
Scan
Daily -
Monthly
Database of
ALL records
from the
beginning of
time
Reporting Process
Today
CPU Lib
Signature Lib
Calculate Peak PVU
For Time Range
specified by USER
Apply Bundling Rules
Guessed by ILMT &
Confirmed by USER
Bundling Lib
Product
Level PVU
Reports

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Optimisation
ITAM Review IBM & SAP Seminar, London 28th April 2015
Or just call it money saving
£$€
Saved
Unused
software
Penalty
Avoidance
Cheaper
licensing
options

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Just to give you an idea
ITAM Review IBM & SAP Seminar, London 28th April 2015
This alone was a €20 million euro saving

21. Premier Sponsor
A Quick Summary
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ IBM has a huge software portfolio and highly complex licensing
metrics, causing challenges in effective licence management
§ Understand your ownership of IBM licences should always be your
first step, and it can be harder than it looks
§ When measuring IBM licence requirement, you need to cover both
PVU based software via ILMT, and Non-PVU based software
manually.
§ It is important to know ILMT's limits and understand how it integrates
with other SAM solutions.
§ If you get things right, a lot of money can be saved!

22. Premier Sponsor
IBM License Compliance Audits:
Understand and Take
Advantage
ITAM Review IBM & SAP Seminar, London 28th April 2015

23. Premier Sponsor
How audit works?
ITAM Review IBM & SAP Seminar, London 28th April 2015
Selection Notification
Scoping &
Initiation
Data
collection
Data
analytics
and
validation
Factual
accuracy
discussion
3-way
hand-over
Settlement
discussions
How to
stay
under the
radar?
How to
buy some
time or
come
clean?
What to
include
and when
What to
share /
submit?
How to
avoid
unnecessa
ry work?
How to
validate
an audit
report?
What
“facts” to
agree to?
How
much to
liability to
accept?
And what you can do to manage it

24. Premier Sponsor
Audit Clause – Key Update 1
ITAM Review IBM & SAP Seminar, London 28th April 2015
Old Agreement
Upon reasonable notice, IBM may verify Customer’s compliance… Such
verification will be conducted in a manner that minimizes disruption to
Customer’s business … during normal business hours. IBM may use an
independent auditor to assist with such verification, provided IBM has
a written confidentiality agreement in place with such auditor.
New Agreement
Client will maintain, and provide upon request, records and system tools
output, and access to Client’s premises, as reasonably necessary for IBM and
its independent auditor to verify Client’s compliance with this Agreement.

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Audit Clause - Key Update 2
ITAM Review IBM & SAP Seminar, London 28th April 2015
Old Agreement
Customer agrees to promptly pay directly … software subscription and
support for such excess use for the lesser of the duration of such excess use or
two years
New Agreement
If Client's records are inadequate to determine IBM Subscription and Support
or Selected Support charges, IBM's charges for any excess usage will include
two years of associated maintenance and IBM Subscription and Support or
Selected Support.

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What do these changes mean?
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ IBM now stands on stronger legal grounds when conducting audits
against its customers
§ It will be harder to ‘buy-time’ and ‘clean up’ by deploying some
classic stalling tactics against audit request
§ Identifying over-usage before audit becomes a lot more valuable
– for at least a 40% saving on cost.

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License Management Option
ITAM Review IBM & SAP Seminar, London 28th April 2015
The only way to keep audits away
§ Demonstrate to IBM that you have a mature SAM process that
satisfies IBM Licence Management requirements
§ You may be asked to facilitate a limited-scope audit
§ Quarterly self-audited compliance reporting to IBM
Pros Cons

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DIY your first ELP
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ Scope (organisational), Scope (3rd party) and Scope
(Product)
§ Create your Effective Entitlement Position
Base licence quantity + S&S quantity + licence metric + licence restrictions
from Ts&Cs
§ Create a project plan, identify product owners for each IBM
application
1. Planning

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DIY your first ELP
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ Validate ILMT/TAD4D deployment coverage and bundling
accuracy
§ Generate and sign all ILMT reports
§ If you have a SAM tool, make sure only the right stuff from
ILMT get’s pull in. Remember it is all about peak over time,
rather than a snapshot of point-in-time.
2. PVU product usage work stream

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The Next Step
ITAM Review IBM & SAP Seminar, London 28th April 2015
§ Read the Ts&Cs in the Licence Document for each title that
is NOT licensed under PVU metric
§ Define a data collection methodology for each title
§ Instruct product owners to generate data accordingly
3. Non-PVU product usage work stream