IBM sub-capacity licensing, which IBM also calls Virtualization Capacity licensing, allows an eligible core-based program to be licensed for less than the full processor capacity of the server or group of servers on which it runs.[1] Instead of every activated core in the physical machine, the customer licenses the cores available to the virtual machines or partitions that host the program. In return, IBM requires the deployment to use eligible virtualization and processor technologies and to be measured with the IBM License Metric Tool (ILMT) or another approved tool, and it requires the customer to keep reports that show the peak capacity available to each program.[1][2]
The arrangement is recorded in the catalog as the Virtualization Capacity (Sub-capacity) Licensing program. It applies to virtual machines and logical partitions; IBM treats containers separately under its Container Licensing policy.[2]
History
IBM announced sub-capacity licensing in 2005, in response to partitioning and virtualization technologies that let virtual servers be moved or resized while running.[2] At first customers accepted separate sub-capacity terms; since 18 July 2011 those terms have been part of the base Passport Advantage agreement, so no separate acceptance is needed (rule).[2] IBM’s current sub-capacity page states that the terms are documented in the Client Relationship Agreement.[1]
The tool requirement has tightened over time. Under version 10 of the Passport Advantage agreement, some customers could report manually instead of using ILMT: where ILMT did not yet support the virtualization technology; where the enterprise had fewer than 1,000 employees and contractors, was not a service provider and had under 1,000 PVUs of sub-capacity servers measured at full capacity; or where servers were licensed to full capacity.[2] Effective 10 May 2022, IBM required ILMT or an approved tool for all Virtual Processor Core (VPC) sub-capacity deployments and ended manual capacity counting for that metric; container licensing was excluded from that change.[1] With Passport Advantage agreement v11, released in February 2023, IBM removed the reporting exceptions altogether and extended the PVU and RVU reporting rules to VPC for new customers from 1 February 2023 and existing customers from 1 May 2023. Clients already reporting manually under the v10 exceptions could continue until 1 January 2024, after which “all prior exceptions are no longer applicable” (rule).[3]
Eligibility
IBM lists four conditions: the product must be an eligible sub-capacity product; it must run on eligible virtualization technologies and eligible processor technologies; and usage must be measured with ILMT or another approved, validated tool.[1]
- Metrics. All core-based products, including those inside bundled programs, are eligible if they use the Processor Value Unit, the Resource Value Unit measured by Managed Activated Processor Core (RVU MAPC), or the Virtual Processor Core metric. ILMT is mandatory for all three.[1]
- Exceptions. IBM names a small set of parts that are ineligible, namely WebSphere MQ for HP NonStop Server and WebSphere MQ for HP OpenVMS, and says such products are typically ones that cannot be virtualized or whose architecture prevents ILMT from discovering capacity (rule).[1][2]
- Technologies. A deployment on a virtualization technology that ILMT does not support must be licensed at full capacity (rule).[2] Virtual appliances, such as an OVA booted on VMware ESXi, are supported provided all compute is charged under sub-capacity counting rules (rule).[1]
- Customers. Sub-capacity licensing is available to Passport Advantage and Passport Advantage Express customers and to service providers (rule).[2]
When an operating system or hypervisor loses vendor support, IBM announces its removal from the eligible list. Ninety days after an operating system becomes ineligible, partial renewals are no longer available, and a customer who wants to keep sub-capacity terms must submit a migration plan for IBM’s approval under section 9.2.2.e of the Passport Advantage agreement v12 (rule).[1]
Counting
For an eligible product in an eligible environment, IBM licenses the lower of two values: the maximum number of virtual cores available to the product at any time, or the physical capacity of the server when the virtual capacity exceeds it. The resulting core count is then converted: through the PVU tables for PVU programs, at one VPC per vCPU for VPC programs, and through the principal program’s License Information for RVU programs. SMT and hyper-threading ratios are not adjusted for, and once virtual cores reach the physical capacity no further cores are counted.[1] The minimum is the entitlement for one whole processor core. For capped PowerVM partitions with fractional capacity, IBM aggregates fractions, applies shared-pool capping and rounds up at server level.[2]
The counting rules apply to servers within the same ILMT region. IBM defines three regions by continent: North and South America; Europe and Africa; and Asia and Australia.[1]
Several FAQ answers refine the method. Virtual cores in a VM moved by a mobility event such as Live Partition Mobility or vMotion are not counted twice, because the same VM cannot run on two servers at once (rule).[2] If a partition is shrunk, the freed PVU entitlements may be redeployed elsewhere. ILMT agents should also be installed on backup servers whose primaries are monitored, so that warm or cold standby instances can be excluded where the product’s licence allows it (rule).[2]
ILMT records the result as a high-water mark: the peak utilization of a metric by a product during the reporting period. When a program runs on several VMs on one server, their values are added before the peak is taken, so the high-water mark can fall in a week when no single VM was at its maximum.[8] For VPC, ILMT caps summed vCPUs at the physical cores only if a VM manager connection is defined; without it, IBM’s example of 22 vCPUs on a 16-core host stays at 22.[9]
RVU MAPC tiers
For programs licensed per managed activated processor core, ILMT applies a tier table in which each band of cores is multiplied by a declining factor: 1.00 for the first 2,500 cores, 0.80 up to 10,000, 0.60 up to 50,000, 0.40 up to 150,000 and 0.20 beyond. IBM’s example of 45,000 cores yields 29,500 RVU MAPC (rule).[7]
Tooling
ILMT is a no-charge IBM program, but it has to be ordered (part number D561HLL) so that an entitlement record and support exist. New sub-capacity customers must install it within 90 days of their first eligible deployment and keep it current. Because staying current is a condition of the sub-capacity terms, IBM notes that the annual support renewal (E027NLL) is in practice required (rule).[2][3]
IBM accepts a limited set of alternatives. HCL BigFix Inventory, in IBM-validated versions, is accepted for virtual machines but not for software on Red Hat OpenShift or Kubernetes. Flexera One IT Asset Management and Flexera One Select, including the IBM-resold Flexera One with IBM Observability, are certified; for OpenShift and Kubernetes they are accepted only through integration with IBM License Service. Flexera FlexNet Manager can be used only after signing a Passport Advantage Addendum and obtaining IBM’s written approval, and other Flexera products are not certified (rule).[3]
ILMT Lite, which uses a disconnected scanner rather than BigFix agents, is pre-approved for sub-capacity reporting. The ILMT documentation sets the limit at up to 5,000 computers, while the Passport Advantage page words it as fewer than 5,000 target VMs or LPARs; larger estates require approval from IBM’s Software Asset Management team. Scan results from disconnected computers must be imported daily (rule).[1][6]
Reporting cadence
IBM does not require customers to send reports routinely, but they must keep documentation of the capacity available to IBM software and produce it on request.[2] The sub-capacity terms set quarterly reporting as the longest interval allowed before ILMT data must be analysed, reconciled and signed. ILMT’s default period is monthly, and IBM suggests weekly reports for highly dynamic environments (rule).[2]
The formal record is the ILMT audit snapshot, a zip file generated from the All Metrics report. IBM describes it as “a valid document for audit purposes” that fulfils the sub-capacity reporting requirement, and advises generating it each quarter and storing it for at least two years (rule).[4] Because historical data in ILMT remains editable, a snapshot can be regenerated at any time, but IBM requires snapshots for the past two years to be available in an audit.[5] The Passport Advantage ILMT page likewise requires documentation to be kept for at least two years, and a customer who fails to deploy ILMT or generate reports is charged at full capacity for all activated physical cores.[1][3]
Out of scope
- Container licensing on Red Hat OpenShift and Kubernetes, which uses IBM License Service and different vCPU counting; see IBM Passport Advantage licensing.
- Public cloud deployments under the Eligible Public Cloud BYOSL policy.
- The individual counting-rule documents for each hypervisor (Power Systems, IBM i, Linux on IBM Z, Solaris, x86), which IBM publishes separately.
- Mainframe z/OS sub-capacity pricing, which is a different scheme.