The Four Hundred

In last week's issue, the article "IBM Previews WebSphere Application Server V5" incorrectly reported that IBM might offer subcapacity pricing for WebSphere Application Server and WebSphere Commerce Suite. The WebSphere licenses have, in fact, been priced based on the number of CPUs in your machine. The effect of subcapacity pricing is that, when running these products in a logical partition, customers only pay for WebSphere licenses based on the number of CPUs used in any logical partition where the software is running.

IBM announced the new pricing scheme in its April 29 OS/400 V5R2 announcement. I had heard pre-announcement scuttlebutt on this price change but missed the actual announcement. IBM has been offering subcapacity pricing for the following WebSphere products since the end of April:

Looking at IBM's WebSphere subcapacity pricing announcement, one might wonder why it took Big Blue so long to do this. There is no question that customers have been complaining about paying WebSphere licenses based on the total number of processors in their machines, rather than the number of processors actually dedicated to the WebSphere software. As we have reported, 44 percent of recent high-end iSeries customers and five percent of uniprocessor iSeries customers are ordering servers with logical partitions pre-activated on their servers, and many other customers are activating partitions themselves. Obviously, IBM and the independent software vendors that make software for the OS/400 platform are going to have to reckon with partition-based pricing for many different programs.

On closer inspection, however, it looks like there are a few opportunities and pitfalls in the way IBM is implementing this pricing structure. Here are my impressions of how this announcement may affect the way you purchase and administer these WebSphere products.

Full-capacity licensing is still available, if you need to load WebSphere across all of the partitions on your machine or to a non-partitioned machine. To be eligible for subcapacity licensing, the WebSphere product must be isolated to at least one logical partition using unspecified IBM-provided tools. However, IBM's announcement doesn't specify what tools you would use to isolate the product, which could complicate an install. Alternatively, these products can be subcapacity licensed on iSeries and AS/400 machines that are merely capable of logical partitioning but not necessarily logically partitioned at the moment (which is a gray area in the scheme). As far as verification goes, IBM didn't specify any software auditing in its announcement. However, IBM does say that, at a future date, customers using subcapacity licensing will be required to send license manager software inventory logs to IBM, and IBM will audit these logs for compliance. So IBM is trying to cut down on potential WebSphere abuse from customers who license these products for the number of CPUs in one partition and then load them into multiple partitions.

With this announcement, IBM is also allowing customers to reallocate existing WebSphere licenses from one machine to subcapacity pricing on one or more logical partitions on another machine, provided that all authorizations from the first machine are applied to the second machine (that is, you will not get a refund if your WebSphere configuration is moving to a partition with a smaller CPU count). The catch here is that customers can't split up WebSphere licenses and reallocate them among several other iSeries or AS/400 machines, either in single partitions or non-partitioned boxes. Licenses can only travel from one machine to another, nothing more complicated.

Also, subcapacity pricing is based on the number of processors present in all logical partitions where the WebSphere products are installed. And, because you can allocate partial processors, the total number of CPUs in these partitions for WebSphere purposes is always rounded up to the next larger whole number. So if you're installing WebSphere 4.0 to a partition on an iSeries 820 machine that uses 1.25 processors from the available CPU pool, IBM will count that as running WebSphere on a dual-processor machine and you must license accordingly. Or if you're transferring WebSphere from one machine to two partitions on another machine (each of which is using 1.25 processors) and the total CPU allocation is 2.5, that counts as a three-processor license. The lesson is that IBM doesn't want to mess around with fractional processors for licensing issues (and reduce WebSphere licensing fees), and a partial processor is as good as a full processor when it comes to WebSphere.

The kicker here is that, presumably, you would need to readjust the pricing when you add or remove processors in a WebSphere partition, but IBM's announcement doesn't cover this. An interesting scenario could occur if you dynamically moved a processor out of a partition running one of the WebSphere products: Would you then be eligible for a rebate from IBM because you are no longer using the processor for WebSphere? I'm sure IBM would like you to buy additional licenses when you dynamically add processors to a WebSphere partition, so why not the other way around? Obviously, there are still some issues that need to be addressed. Maybe this situation will become clearer when IBM requires software auditing to verify WebSphere licensing.

Finally, IBM said that if customers licensed the products before the inclusion of the new subcapacity terms, they can request a copy of the updated terms from either IBM or their business partners. However, it's unclear whether you can adjust WebSphere pricing on a product you owned before this announcement and are already using in a partition. The kick-off date for this program was April 29, so you may want to contact IBM or your business partner to get the final word on that question.