IBM makes it possible with their licensing to run IBM Cognos on a virtualisation hypervisor like VMware ESXi and make full use of vMotion, HA and DRS. Many IBM products can be licensed as User-Based or Capacity-based. If the product has a server component, it will commonly be licensed as Capacity-based. Within a virtual environment like VMware you may use sub-capacity licensing for certain IBM products like Cognos.

Common used abbreviations are: PVU – Processor Value Unit / ILMT – IBM License Metric Tool / VM – Virtual Machine, a VM represents a complete system with processors, memory, disk and network resources.


  1. Yes you can and may use IBM Cognos, licensed through PVU, in a VMware environment.
  2. Yes you may use vMotion, HA, DRS to move the VMs through the whole cluster.
  3. No you do not have to pay for the whole cluster. You may license for the cheapest, or virtual or the physical underlying infra. Counting all physical cores in a VMware server/cluster where the VM with IBM software resides versus the total amount of vCPUs for the specific IBM software in multiple VMs. Follow the Virtualization Capacity license counting rules to determine, by program, the number of processor cores required to license. Determine the PVU factor by checking the correct table.
  4. Yes you need to install the ILMT tool within 90 days of signing the contract (a few exceptions apply, but I recommend you use the tool to make your life easier).
  5. You are not required to report to IBM the PVU usage on a regular basis, but you are required to generate quarterly ILMT reports and keep them for a period of two years. These reports must be provided if IBM conducts an audit.

PVU licensing is based on the processing capacity (expressed in PVUs) available to the IBM middleware. In the case of VMware, IBM license based on the number of  virtual cores (vCPUs) available to a partition. Each vCPU is equal to one processor core for PVU licensing. IBM license to the lower of the sum of vCPUs or full (physical) capacity of the server or cluster. Copies of the revised IBM International Passport Advantage Agreement – effective 18 July 2011 are available for download here.

Difference between Sub-capacity licensing and full capacity licensing

  • Sub-capacity licensing lets you license a PVU-based software program for less than the full processor core capacity of the server, when the software program is deployed in an eligible virtualization environment.
  • With full capacity licensing, you are required to obtain PVU license entitlements for all activated processor cores in the server, regardless of how the software was deployed.

Full capacity licensing is based on every physical, activated processor core in the physical server. Back when servers were one processor core sitting on top of one chip plugged into one socket, software was licensed on full capacity basis by default. The concept of full capacity licensing has not changed, even with the proliferation of multi-core and multi-socket servers. Licensing was basically simple. But with partitioning and more sophisticated server virtualization technologies that create virtual CPUs, virtual servers/partitions (aka virtual machines, LPARs, etc.) that can be moved and/or resized on the fly, came the demand for more flexible licensing terms. Thus IBM announced its sub-capacity licensing offering back in 2005.

Why use sub-capacity licensing

IBM’s Passport Advantage Sub-Capacity Licensing offering enables you:

  • to leverage server virtualization to more effectively consolidate their infrastructure and reduce their overall total cost of ownership (TCO)
  • allows flexible software licensing using advanced virtualization capabilities such as shared processor pools, micro-partitioning, virtual machines and dynamic reallocation of resources
  • gives growing customers the flexibility to choose how to add workload environments without making trade-offs between hardware design and software licensing
  • enables you to license software for only the processor core capacity available to the partition hosting the IBM software
  • provides a tool (ILMT) which allows you to track and manage the processor core capacity available to IBM PVU-based middleware

How to count the correct PVU units

First you must understand your virtual environment and how it is setup. So how does the physical server look like, which processor brand and technology is used, than which virtualisation technology and version is running. Furthermore how the IBM software is deployed into Virtual Machines and how do those VMs look like with virtual hardware and specific virtual cores applied to it.


If you know the environment than you can use the formula below to calculate the total amount you need to pay or have payed. In the scenarios we use a Physical server with 2 pCPU with each 4 cores. Scenario 1 has 4 pServers with a total of 32 Cores and Scenario 2 has 2 pServers with a total of 16 Cores.

  1. Get the correct PVU value for the used Processor Type, Brand and Model in this PVU table. How does the physical server look like? We use Intel E5- 2600 series CPU in both scenario’s, so we have to get the PVU value for the used Processor Type, Brand and Model in this PVU table. After checking the table we find that the PVU value is 70 for each core.
  2. Count the vCPU used in all VMs for the specific IBM product and call that total # of Cores where each virtual core is equal to one core for PVU licensing. For scenario 1 that will be 7 Cores and for scenario 2 it will be 18 Cores.
  3. Check your contract, offer or invoice for the cost per PVU.

# of Cores x # of PVUs  x Cost per PVU = Total Price to Pay

For scenario 1 the physical layer will be 32 cores x 70 PVU = 2240 PVU and the virtual cores will be 7 vCPU x 70 PVU = 490 PVU

For scenario 2 the physical layer will be 16 cores x 70 PVU = 1120 PVU and the virtual cores will be 18 vCPU x 70 PVU = 1260 PVU

Generally, for any Eligible Product installed in an Eligible Virtualization Environment, you may license to the lower of:

  • PVUs for the maximum number of virtual cores in the virtual machines (VMs) available to the Eligible Product at any given time or
  • PVUs for the maximum number of physical cores in the server/cluster available to the Eligible Product at any given time

So in scenario 1 we will pay for the virtual CPUs and with scenario 2 it is smarter to pay for the underlying infrastructure. But reality is that servers are getting bigger and CPU’s are getting more and more cores. So I think most organizations will use the virtual core count to lower their cost but still make full advantage of virtualisation with HA and DRS. IBM sees vMotion as a Mobility event, where a running VM is moved from one physical server to another, and you may do that without restrictions if correctly licensed ofcourse.

To determine the correct number of Processor Value Unit (PVU) licenses required for the Eligible Virtualization Environment (for VMware vSphere):

Compliance and Entitlements

Q: Do I need to use the ILMT tool?

A: Yes you do, the IBM License Metric Tool is required when you are using Sub-capacity licensing or in other words running the software in VMware. There are some exceptions tho, but I would advise you to always use the free ILMT tool to make your life easier. The ILMT helps you maintain an inventory of the PVU based software deployed for your Full Capacity or Virtualization (Sub-) Capacity environment, and measures the PVU licenses required by software Product. It is intended to help you manage your IBM software licensing requirements, and help you maintain an audit ready posture. Customers are responsible for supplying hardware and installation services required for installing the tool. The tool generates audit reports. These reports provide the Processor Value Unit (“PVU”) license requirements based on the Virtualization Capacity available to the Eligible Sub-Capacity Product.

Exceptions to this requirement are:

1. when ILMT does not yet provide support for the Eligible Virtualization Environment

(In order to be notified when ILMT support for eligible virtualization technologies become available, customers need to subscribe to “My Notifications”.

2. if your Enterprise has fewer than 1,000 employees and contractors worldwide, you are not a Service Provider, and you have not contracted with a Service Provider to manage your Eligible Virtualization Environment

3. if total physical capacity of your servers with an Eligible Virtualization Environment, measured on a Full Capacity basis, but licensed using sub-capacity terms is less than 1,000 PVUs.

For the above exceptions, customers must manually manage, track, and prepare a Manual Calculation of Virtual Capacity worksheet for each server. For more details about the requirements for this worksheet, you can go to Virtualization Capacity License Counting Rules or use the Manual Calculation of Virtual Capacity worksheet.


Q: Do I have to pay for the ILMT tool?

A: No. The IBM License Metric Tool is a free product that IBM makes available to IBM Passport Advantage clients to help them determine the consumption of processor value units (PVU) for the IBM full and sub-capacity software they acquired. The tool helps clients assess if they are compliant with licensing requirements and it provides reports that are required for IBM compliance audits.


Q: How can you obtain the IBM License Metric Tool?

A: Even though ILMT is a no-charge product offering, an order must still be placed to establish an IBM entitlement record for the license as well as software subscription and technical support (S&S) coverage. That’s because ILMT receives the same level of technical support offered for the rest of the Passport Advantage product portfolio, as opposed to other free tools and utilities that are offered “as-is” with limited to no technical support. For additional guidance and instructions on ordering ILMT, see IBM License Metric Tool PA Online Ordering.(PDF, 926KB)   The initial order for ILMT should use P/N D561HLL. In order to maintain an entitlement record, S&S should renewed annually using P/N E027NLL.


Q: Increase available capacity or buy licenses first?

A: Buy licenses first, because you would be out of compliance. The licensing terms require that customers must obtain license entitlements before increasing the processor core capacity to be in compliance. IBM will request payment for the licenses required for the additional processor core effective the date the additional processor core capacity was added (includes back coverage for Software Subscription and Support)


Q: Is VMware vSphere an eligible virtualisation platform?

A: Yes. It sure is check for sub-capacity.


Q: Do I need to report the PVU usage per eligible product to IBM on a regular basis?

A: You are not required to report to IBM the PVU usage on a regular basis, but you are required to generate quarterly ILMT reports and keep them for a period of two years. These reports must be provided if IBM conducts an audit.


Q: Can I install the tool or must I hire someone?

A: You can Install it yourself or hire an IBM partner to help you.

For installing instructions you can educate yourself, download the tool, install the tool and configure it.