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The Licensing Impacts of IBM Cloud Paks


What are IBM Cloud Paks? | 01:06 – 02:55

Per IBM, Cloud Paks are “lightweight, enterprise-grade, modular cloud solutions, integrating a container platform, containerized IBM middleware and open source components, and common software services for development and management.”

The main purpose of IBM Cloud Paks is for software to be more easily deployed into the Cloud. An IBM Cloud Pak consists of the following:

– Existing IBM Software Product Bundles
– Additional Red Hat Product Licenses (RHEL & OpenShift)
– Product Ratios with Swap Options
– Consolidated Purchasing Part Number
– Virtual Processor Core (VPC) or Managed Virtual Server (MVS) Metrics
– Containerized Software Deployment Packages

The Most Common IBM Cloud Pak Bundles | 02:56 – 04:43

In this section, we give a little detail about the most common Cloud Paks.

Cloud Pak for Applications
Includes: WebSphere Application Server ND, WebSphere Application Server, WebSphere Application Server Liberty Core, Mobile Foundation

Cloud Pak for Integration
Includes: MQ & MQ Advanced, App Connect Enterprise, API Connect, DataPower Virtual, Aspera, Event Streams (Kafka)

Cloud Pak for Automation
Includes: Operational Decision Maker, Business Automation Workflow, FileNet Content Manager, Datacap, Datacap Insight Edition Add-On, Content Collector, Enterprise Records

Cloud Pak for Multicloud Management
Includes: Cloud Pak for Multicloud Management Core, Event Management, Infrastructure Management, Base Monitoring, Advanced Monitoring

Cloud Pak for Security
Includes: RSO, A&R Platform; RSO, A&R Platform Privacy; RSO, A&R Platform MSSP; RSO, A&R Platform Team Management; QRadar Software; QRadar Event Capacity; QRadar Data Store; and more

Licensing IBM Cloud Paks – Considerations, Cost Implications, Benefits | 04:45 – 10:20


Perpetual vs Subscription-based?
Typical breakeven is targeted at 3 years, meaning for projects lasting longer than that you may want to consider perpetual. It may make more sense to go subscription-based for shorter-term projects.

On-prem vs. Cloud?
The licenses can be utilized both on-premise and cloud infrastructure. Cloud Paks are versatile and flexible when transitioning from on-premise to the cloud.

Existing Licensing
IBM has stated that they are moving toward Cloud Paks, though traditional licensing is still available. However, IBM has announced that it will be removing many of the discounts on traditional licensing and focusing on the hybrid cloud.

Cost Impacts:

S&S Commitments
Some additional Red Hat licenses are only available if you keep the license on S&S.

Adopting Cloud
As mentioned, IBM will be removing most of the incentives to continue with traditional licensing. Most of the software product releases going forward will be deployed in a way to be easily adopted and configured to be added directly into cloud environments.

There will be an additional effort required to monitor and properly assign deployments to appropriate Cloud Pak licenses.

Fixed Ratios
There are fixed ratios inherent to Cloud Paks. Because of this, you can lose some granularity, and if you don’t use the full amount of the ratio you may still have to pay for the full amount.


It is easy to switch between products or metrics within the bundle. This also applies to switching from non-production to production or vice-versa in certain Cloud Paks.

Monitoring IBM Cloud Paks | 10:21 – 21:10

Two different tools exist to monitor Cloud Paks, depending on your deployment strategy. ILMT is available for non-containerized environments, License Services is available for containerized environments. Additionally, there is an aggregation tool that consolidates the outputs from ILMT and License Services included in the IBM Cloud Pak for Multicloud Manager.

For step-by-step Cloud Pak licensing instructions in ILMT and License Services watch the webinar from 11:27-13:15.

To better understand IBM Cloud Pak ratios and the associated licensing considerations, watch from 11:15-21:10.

Q&A | 21:11 – 31:12

Learn more about Anglepoint’s work with IBM Licensing in our IBM and IT Environment Case Study

Webinar Transcript

Kevin Rieske:  So, today’s topic is going to be discussing the licensing impacts of IBM’s Cloud Paks. So, on today’s agenda, we’re going to discuss what are IBM Cloud Paks, and mainly the licensing around IBM Cloud Paks and how an organization monitors the usage of Cloud Paks within their environment.

And then we’ll have a brief q and a at the end. And as always, if you have any other questions, feel free to reach out. So, what are IBM Cloud Paks? So, an IBM Cloud Pak consists of a bundle of IBM existing IBM software and some new IBM software that has been released to be focused mainly on the deployment within cloud-based environments.

Along with these bundles of IBM software traditional IBM software, they are now including Red Hat product licenses, such as Red Hat Enterprise licenses and OpenShift platform licenses as well. They come with an ability to swap out products within the bundle. So, each of those products have a different ratio and you own X number of Cloud pack VPCs or MBSS.

It can be swapped between the different product bundles within the, one of the nice things about the licensing is it has been consolidated to a single part number. Which allows for ease of purchasing and management of, from a renewal perspective. And as mentioned previously, the two-licensing metrics that the Cloud Paks utilize are virtual processor course and manage virtual server metrics.

And they are meant to be Deployed within private cloud, public clouds, hybrid clouds, and even traditional on-prem deployments are allowed as well. The most common IBM Cloud Pak bundles are the following. So, we have Cloud Pak for applications, which include your Webster application server network deployment, your standard base Webster application server, and Webster applications Server Liberty Core, along with mobile Foundation for Cloud Pak. For integration, it comes with MQ, advanced App Connect, enterprise API Connect Data, power Data, power Virtual Aspera event streams. For the Cloud Pak for automation, we have operational decision manager, business automation, workflow, FileNet, content manager, data cap, insight edition, content collector, and enterprise records.

For Cloud Pak for multi-cloud management comes with the Cloud Pak for multi management core, the event management, the infrastructure management, the base monitoring, or the advanced monitoring, which includes Tivoli monitoring. Composite application manager and ITAM for applications and transactions for web and robotics.

Smart cloud application manager, smart cloud, application performance management, smart cloud monitoring. And the last Cloud Pak we’re going to discuss is the Cloud Pak for security, which comes with the resilient security orchestration, automation, and response platform. And then a variety of different Add-ons to that as well as QRadar.

Both in the software, the event capacity, software nodes, flow capacities, network insights and data stores. We’re going to get into the licensing of Cloud Paks and the, we’re mainly focusing on kind of three different areas. What are some of the considerations to moving into the Cloud Paks?

What are the cost implications of switching into the Cloud Pak model? And then what are some of the benefits.

So, couple of the main considerations as you’re switching into Cloud Paks or purchasing net new is whether you would like to buy Perpetual Cloud Pak licenses or subscription based monthly or yearly based subscription model of the Cloud Pak. General rule of thumb is for projects lasting more than three years, you’ll probably be interested in moving towards the perpetual with the standard s and s model.

Or for short term projects, you may go straight to just subscription for the lower entry cost, on-prem versus cloud. As mentioned, these cloud packs, even though they are targeted to be moved to the cloud, whether that be the private, the public or hybrid can also be utilized on-prem in non-cloud environments.

So, it is important to recognize that during your transition, these from on-prem to cloud, it’s also very versatile and very flexible in nature, the existing licensing. So, IBM has Stated that they are moving towards these cloud paks, and this is their intention going forward. The traditional licensing is still available under PVU and other metrics.

However, IBM has recently announced that they are removing a lot of the discounts available to those traditional style licensing and. Focusing on the hybrid cloud. So that is definitely a consideration to recognize that is the direction of IBM and the incentives are to move you into these cloud paks so you’re better suited for the transition into cloud environments.

There are some impacts you need to be aware of with the support and subscription. Inside of these licenses there are the ability to switch between these software products. However, there are also some additional Red Hat licenses that are incorporated, and these are only available if you are on SNS.

So just be aware of that was especially related to the perpetual licensing. When adopting cloud IBM as we mentioned, are removing the incentives to remain on traditional licensing. Most of the software product releases going forward will be deployed in a way that can be easily adopted and configured to be added directly into cloud environments.

That is the main reason for these cloud packs is to allow for easier, quicker deployments and make it available to be put into an OpenShift platform, which can easily transfer between the different clouds’ environments monitoring as well. A lot of our clients are asking what an impact is this going to have on our ability to track licensing?

There is an additional effort required to monitor these cloud packs as they are a bundled package. So, there’s we’ll discuss these in a little bit and go over how to monitor these within the various tools available, but they do take an additional effort to get them. Properly bundled into a Cloud Pak and to monitor within the variety of environments that these can be deployed within.

The other item to consider is the fixed ratios that are inherent to these products. You can lose some granularity between the different ratios if you are not utilizing the full amount of the ratio. That can have a little bit of. An impact to some clients. Example being if you have a product that comes with, for example eight webs for application servers to everyone PPC.

If you want to deploy anything less than the eight cores of webs for application server, Liberty Corps You still must pay for one PPC of the product, which once again loses some of that granularity to go down to just single instances of the product. That being said, there’s also ease of switching between the products.

So, as you stop deploying one product, you can easily switch over and deploy any other product within that metric. The nice thing is that also applies to switching from. Non-production to production or vice versa for those environments that have different ratios for the production and non-production environments.

So, moving over to how do we monitor these cloud packs. So, there are two different tools available depending on the deployment strategy that you take. If you are using the traditional non-con containerized environments, our IBM’s license metric tool is still available and works with managing and monitoring cloud Paks within those standard environments.

If you are moving to the containerized environments, Kubernetes, etc., you will need to deploy an alternative strategy called license services, which is made available to IBM clients as well, utilizing those containerized environments. And there is also an additional aggregation tool to consolidate the outputs from both ILMT and licensed services that is included within the IBM Cloud Pak for multi-cloud manager.

However, obviously that is a paid option. So, walking through how to do Cloud Pak licensing within ILMT or license metric tool. So, there is a two-step classification process. First, you must assign the component to the appropriate bundled product within the Cloud Pak, and then the appropriate metric as well.

And then once that is appropriately assigned, then you can assign it to the Cloud Pak bundle that it belongs. The once you are, once you have those properly assigned and classified, IBM has added a new report. Under the reports, it’s called Flex Point and Cloud Packs report which will highlight these products, the quantity in which they’re deployed over that peak period of time, and shows up as the very similar to the PV and RVU reports did previously within ILMD.

Switching over to licensed services. If you are deploying these same products within a containerized environment, you must be running the licensed services that is embedded within the Within your environment and through the use of an API, you can retrieve the audit snapshot, which gives you a daily breakdown of how much each of those products are being used in the VPC or MVS metrics.

Before we jump into Q&A just to briefly explain a little bit more of how the ratios work. I have pulled up here Cloud Pak for integration, so inside of the Cloud Pak for integration. For each the following. For each of these products, the following metrics have been stated. So, for everyone VPC of App Connect Enterprise that’s deployed.

It requires three VPCs of Cloud Pak for the non-production environment. For every two VPCs deployed, it requires the same Cloud Pak ratio of three VPCs of the Cloud Pak for app for integration. As you can see, that does add a 50% discount to the non-production environment. And the nice thing is that IBM allows you to switch freely between these two products where traditionally you needed to license the non-production environment with one part number and addition, and a different part number for the unrestricted production environments. IBM. Has now simplified this, allowing you to shift. This has some exciting implications for some organizations that may start out with a non-production environment, grow that non-production environment, and then eventually they may switch over to add, adding production environment.

And want to retire some of the non-production environments and test environments and deploy additional processors worth of production environments. So, this allows a lot of flexibility to do obviously at any given time, you must have the appropriate amount of VPCs, of the Cloud Pak to cover all environments that are within your environment at the time.

The, another example, just taking down here. So, we have MQ advanced. For every two VPCs of MQ advanced, it requires one VPC of the Cloud Pak for integration. For every four VPCs of non-production, it requires one. As mentioned previously, that may play into some of those granularity issues.

If you only want. Two cores of non-production as well. Obviously, the pricing benefit still requires you to buy one, one VPC of that, of the non-product of the cloud back for integration. There are some definite licensing implications that you need to be aware of while deploying these products.

Obviously the most optimal would be staying in ratios of four and or two within your production environment. You can see here that if you want to do MQ instead of MQ advanced you get a four. Four VPCs of production for everyone. VPC of Cloud Pak for integration, making it basically half the cost of the MQ advanced.

And then the same thing is true for the MQ for non-production is you also get eight to one ratio as well, which puts that at half price for the regular standard MQ. One thing that’s exciting about this particular offering is that IBM traditionally has not offered MQ for non-production in traditional licensing but have introduced it here in the Cloud Pak. As you can see at the end, so after you get past all of the standard bundled products of IBM, you get the additional programs, which in this case consists of Red Hat Enterprise license, Linux licenses and then also OpenShift container platform licenses.

And you get three VPCs for every Cloud Pak you license as well. So, it does require you to stay on support and subscription for these additional program benefits to be applied. But those are something to consider while evaluating the cost of. Moving to the Cloud Paks. As you can see with the different Cloud Paks, each one has a variety of different products.

Some have fewer, some have more. Within their bundle. For example, the Cloud Pak for automation even within the file net, for example, you can license it by virtual processor core, or you can license it by a mix of concurrent or user base products, whether that be concurrent authorized employee and frequent or external each one having their own different ratios to be utilized.

Or you can switch to a capacity based. Metric and just license the infrastructure and have the unrestricted user counts. So, either approach is available within the same cloud Pak for automation and allows for easily converting mentioned. That can also lead to some interesting deployment strategies.

You may start out with having a very small environment to test it out, get familiar with the product in which you can license. It’s strictly based off the user-based population, which may end up being relatively inexpensive, but once you’re ready to deploy it out to the larger population, you may actually choose to switch over to a capacity-based model and license either the production or all of your environments.

By your virtual processor core model allowing for unlimited users if the infrastructure capacity is licensed. And then the ability to switch between those midway through your project can be very advantageous. Once again, they do come also with some Red Hat licenses at the bottom.

And just shifting to a few additional ones. We have the Cloud Pak for multi-cloud management. The interesting thing about this one is it is under the metric managed virtual server as opposed to the virtual processor course. So, it’s for each managed virtual server that you’re deploying that you.

Monitor and measure these. However, the Red Hat additional licenses are still by virtual processor core, but they do come in package or bundle packages. So, for 48 cores, you have licensing of one to 500 from 96. Anywhere from 501 virtual processor cores to 10,000 or. 501 MBSS of this Cloud Pak will get you 96 all the way up to 10,000.

And then once you hit the 10,001, you get entitled to 144 virtual processor cores of the Red Hat OpenShift Container Platform. As you can tell, this can be I. This can add a little bit of complexity to measuring and monitoring, as now you are mixing Red Hat licensing with IBM traditional licensing, and this is additional licensing, which is above and beyond to what you’re paying for in the IBM above.

These do add some complexity to measuring and monitoring the Cloud Paks. And then Cloud Pak for security also is in NVS, and the correlating Red Hat is in VPCs as well. We’re going to switch over to Q&A.

First question: For customers who are considering moving the support of these IBM products, the third-party support providers, can you give some examples of the impact?

So, if I understand the question for customers that are considering using a third-party support provider as opposed to IBM’s traditional SNS, a couple things would be key things to note. The first thing is that these additional programs would be no longer valid, so you would not be able to take advantage of the additional Red Hat licenses that come, including with these Cloud Paks as they’re no longer on SNS according to IBM.

That’s one of the largest items to be aware of. The other thing obviously is whether you’ve chosen subscription based or perpetual licenses if you’ve chosen subscription based, you are getting SNS automatically included. So obviously the only. The only typical scenario is when you’re using perpetual and then choosing to drop the SNS.

So that will have that additional time to value. So, if you are using these products for less than three years, where a traditional subscription-based model comes into play you may be double paying for support in that particular case. I think that covers Most of the concerns in that area.

Second question: Is IBM Claims Cloud Pak simplify the licensing of products, yet you are claiming it adds complexities relating to licensing. Can you give a few examples of this?

When IBM’s talking about simplifying, what they are talking about is the ability to simplify from a purchasing perspective. So, you are simplifying it down to one single part number. So, you buy X number of cloud packs whether that be MBS or VPCs. Then the nice thing is that it gives you full flexibility to use those licenses, how you wished to deploy them within your environment.

So, from that perspective, they are adding a lot of simplicity from a purchasing perspective. But as mentioned, it does add complexities from a license management perspective or the software asset management perspective as each one of these products now must be managed, measured before getting to the final deployment count of those cloud packs. So, it doesn’t necessarily complicate measurements because you will still need to measure what’s deployed in your environment. But once it is measured, you do need to properly bundle it back into a cloud pack. Apply the appropriate ratios if not utilizing one of those tools that does that for you automatically.

And then you also must track separately the Red Hat entitlements that come with those products. And then understand that impact that it plays on your deployment numbers and your procurement numbers from that perspective as well. From my perspective, from a licensing software asset management perspective, it does add far more complexity, but along with that complexity comes that flexibility of being able to switch between those products.

Hopefully that some good explanations as to those complexities and the only other one to consider is that if you are deploying in two different environments, containerized and non-con containerized, it does cause that additional piece of aggregating the totals between the two tools, which if you have not paid for that additional product, you will need to do manually as well.

So that’s another piece that can add to some of the complexities. Great.

Last question: What are some of the ways customers can get the most benefits from the Cloud Paks licensing.

Obviously, the key pieces are utilizing the flexibility. So just quickly going back to our example of. We’ll stick with right here to Cloud Pak for integration. So, if a customer were to start by deploying, we’ll start with MQ non-production. So, they start with deploying MQ non-production, slowly work their way to Adding in MQ and then later decide, you know what?

I want to take advantage of some flexibility both in my non-production and my production for the additional security features which come with the advanced package as opposed to needing to trade up and switch between each of those licenses. So separately that previously that customer would have needed to buy four different part numbers to accomplish those tasks.

And they would have to buy them. At the time in which they deploy them. So, starting with the non-production, then going to m or to production. And then eventually they’d need to do a trade up to get to the advanced and they advanced for production. And let’s say they even take advantage of later deciding, what?

Maybe these aren’t adding as much value as I want and they want to switch back down to standard MQ in previous environments, that was very difficult to accomplish. Now it’s all embedded within that license itself. So, taking advantage of those flexibilities instead of buying two products, then trading them up, and then not having the option to trade them back down.

So, every time you use that flexibility, whether it’s to change from MQ to advance, whether that’s to switch completely from MQ to App Connect, whether that’s to downgrade back down to MQ, all of those would’ve been separate transactions within IBM. Now that is all simplified into one part number with the rights included inside of it.

So that’s definitely one area to consider. Instead of repurchasing licenses you get to just re-ratio your deployments and so in that way you’ll save money instead of having to purchase products and throw away the old one. Other piece is obviously taking advantage of the Red Hat licensing that comes included.

Each one of those that you take advantage of is just an additional freebie that is included with the package. I hate to use the term freebie because it. It comes with the cost of the licensing, but if you are willing and are planning to keep these on s n s anyway those are additional licenses that are made available through this package.

Those are the easiest way to take advantage of them. Other. Potential strategies since these are on a virtual processor, core license metric these are typically priced at about a 70 PVU to one virtual processor core ratio from a pricing perspective. So, any client using a hundred PV per core or 120 PV per core.

So, if you’re on power machines, for example You’ll be getting the benefit of just being on a virtual processor core metric, and not paying for a full 120 PVS, but an equivalent 70 PVU instead. So that’s another way to optimize and take full advantage of these licensing models as well. And There may be some additional ways to optimize and take advantage of these licenses that I’m not thinking of.

I’m sure there are. And this is on top of the, just the natural product itself, which is meant to be faster, easier to deploy within the Cloud Paks, and then the ability to shift them between the different platforms whether that’s Azure, AWS, IBM Cloud, etc.

Plus, the licensing benefits that go on top of it is where the customers get their best optimization for these licenses. If you have any further questions, feel free to reach out to Kevin directly or message us on our [email protected].

Be watching for the recording of this webinar and we hope to see you again next time.