IBM Approves Limited Exceptions to ILMT Sub-Capacity Reporting

For more than a decade, IBM has allowed its end users to license IBM software products on a sub-capacity basis.  For IBM licensing purposes, sub-capacity licensing required customers to accept the sub-capacity licensing terms (originally in a separate sub-capacity license agreement signed by both parties), and ultimately as part of other licensing agreements.  The more onerous sub-capacity licensing requirement was apparently the requirement that customers install and configure an IBM-approved reporting tool, in most instances, the tool was IBM’s License Metric Tool (“ILMT”).  This free tool (an approved alternative) was required to demonstrate that the end user did not exceed the licensed capacity of the server on which the software was installed.

The primary issue with ILMT appeared to be that it was difficult, if not impossible, for many customers to get the tool installed and reporting correctly.  There were limited resources available to assist customers who were trying to use ILMT, and if ILMT was not installed or reporting correctly, IBM’s position was that the customer had to license the products on a full-capacity basis until the bugs were eliminated.

IBM customers who want to license IBM products on a sub-capacity basis may have an opportunity to disregard ILMT.  In November 2020, IBM announced that for a limited number of its customers, the list of IBM-approved sub-capacity reporting tools is expanding.

In 2019, IBM rolled out its IBM Authorized SAM Provider (“IASP”) program where IBM customers hire one of IBM’s approved SAM providers and thereby avoid programmatic IBM audits during the term of the IASP relationship.  Now, IBM has clarified that in addition to the other programmatic benefits, IASP customers can now substitute any of Gartner’s top four tools listed on Gartner’s Magic Quadrant Report for SAM Tools. Currently, those tools include Flexera (which was already approved for sub-capacity reporting under certain circumstances), ServiceNow, Snow, and Aspera.

Those wanting to participate in the IASP program should carefully review all the requirements and the terms in the SAM provider agreement, to ensure that there are no unpleasant surprises about who will provide periodic reporting to IBM, and what, if any, contractually required data IBM will require to eliminate the ILMT requirement.