Through effective sub-capacity licensing, organizations can optimize their budget and resourcing. In our blog, we help you better understand whether sub-capacity licensing for your business could benefit your business and assess the alternatives.
IBM sub-capacity licensing allows organizations to license software based on the virtual processor cores they’re using, instead of licensing the server’s full physical capacity. If your organization is eligible for sub-capacity licensing, it can save you money and resources.
While sub-capacity licensing comes with auditing and reporting requirements, its benefits can be significant. With Origina's expertise beside you, you can get advice on whether sub-capacity licensing could work for you: the potential benefits for your business, meeting IBM’s eligibility criteria, and how you can continue to use it after software has gone End of Support with the original manufacturer.
Sub-Capacity vs. Full Capacity
Full Capacity: The default licensing method for IBM software. It bases license volumes and charges on the capacity of the entire machine or cluster of machines available to the licensed program, rather than just the partition or virtual machine capacity made available.
Sub-Capacity: When a customer meets certain contractual conditions, they have the option of licensing based on the capacity of the partitions or virtual machines on which the software is used. It should never exceed full capacity.
What Are the Benefits of Sub-Capacity Licensing?
Sub-capacity licensing can bring about real, impactful change for your business. Effectively introducing it across your business can mean significant financial savings. Moving from full to sub-capacity means customers can avoid paying for licenses for resources they’re not using. Essentially, this could mean avoiding paying large amounts of money for nothing,
In some scenarios, it may even be possible to consolidate software to make full capacity licensing more cost effective. This is explained in more detail below.
Upgrading when it is not necessary will also likely involve throwing out perfectly good hardware because it is no longer supported by the original manufacturer. This is environmental vandalism. Continuing to use full capacity licensing when possible can therefore be a sustainable business practice.
How Can Origina Support Sub-Capacity Licensing?
Origina can guide you through the process of meeting sub-capacity licensing criteria or assessing whether optimizing at full capacity could be a better fit for your business. We can support your continued use of software after it has gone End of Support. We utilize our years of expertise to identify the plan of action that works best for your business.
Upcoming Time Pressure
In 2026, sub-capacity licensing is particularly relevant for countless companies. Over the course of the year, major technologies will go out of support for sub-capacity. These include VMWare 7, AIX 7.1, Windows Server 2016, and Red Hat Virtualization. You can find detailed Plans of Removal from IBM here.
If your organization still relies on any of these technologies, it's time to make a plan if you wish to continue using sub-capacity licensing. That plan may involve:
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Operating System and Virtualization software upgrades
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Consolidation to enable Full Capacity licensing
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Cloud Migrations
What are the Sub-Capacity Licensing requirements?
To avail of sub-capacity licensing, your business must:
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Use eligible sub-capacity programs
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Use eligible virtualization technology
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Use specified clouds
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Use specified operating systems
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Use specified virtualization/hypervisor products
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Use eligible processor technologies
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Use IBM’s License Metric Tool or another approved tool (BigFix or Flexera)
You must also meet the following contractual reporting requirements:
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Agree to properly install, run, and maintain the most current version of the applicable license reporting tool within 90 days of first deployment and produce a report.
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Assign authority to manage and promptly resolve questions on reports or inconsistencies between report contents, license entitlement, and the applicable license reporting tool.
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Run reports at least once per quarter and retain each report for a minimum of two years and provide to IBM upon request.
Sub-capacity licensing can significantly reduce costs for customers. However, customers who choose sub-capacity but are not fully compliant with the associated rules may face penalties during audits, giving IBM considerable commercial leverage.
Origina can help you optimize your use of sub-capacity licensing, reduce your costs, and meet compliance requirements.
Is IBM Approval Needed for Sub-Capacity Licensing?
IBM defines the criteria you must meet to use sub-capacity licensing, but no pre-approval or notification to them is required.
End of Support: Do You Need to Upgrade?
Operating systems or virtualization technologies that reach End of Support by their vendors are removed from the list of technologies eligible for sub-capacity reporting and supported by the license metric tool. IBM then provides 180 days for customers to move to a newer version of the relevant technology.
So, when this happens, does your business need to upgrade? Not necessarily.
Alternatives to Sub-Capacity Licensing
If your organization is unable or unwilling to comply with sub-capacity licensing eligibility requirements, going cloud-based or consolidating full capacity licensing may be better options. These are also effective ways of avoiding an onerous and expensive upgrade process.
In certain cases, consolidating full capacity licensing may be even more cost-effective than continuing with sub-capacity. This may be the case if your organization is already using most of the server capacity or if there is a significant enough volume of deployed software.
Another benefit of full capacity licensing is that it removes the licensing requirement that may drive the resource costs of an upgrade. Your technical teams can continue to focus on core business processes, rather than being diverted into an upgrade process requiring significant time and effort.
Going cloud-based may also be an effective alternative, subject to IBM’s Eligible Public Cloud Bring Your Own Software License policy. You will also need to continue using IBM’s License Management Tool, which requires specific configuration to report correctly.
Sub-Capacity Waivers and Migration Plans
For technologies that are not eligible for sub-capacity licensing, you are still entitled to apply to IBM for a waiver. You can submit a migration plan to IBM to continue licensing at sub-capacity. Origina can support your organization in submitting a waiver to continue using sub-capacity licensing during any migration.
Separating Your Roadmap
The ability to separate your roadmap from your OEM vendor can bring major benefits to your business.
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Technical: Your stable environments can be maintained without unnecessary upgrades or migrations
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Resource: Your organization’s engineers and technicians can focus on your core business requirements
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Financial: You can avoid some of the significant financial costs associated with hardware and software upgrades
If you’re assessing your options, partnering with Origina could provide the answers you’re looking for.
For more information on how Origina can help you, get in touch today.
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