IBM System z Software Pricing Guide Share Europe

IBM Software Group IBM System z Software Pricing Guide Share Europe March 17th 2010 Marc Wesemael, IBM Belgium, System z SW marc_wesemael@be.ibm.com http://www.ibm.com/systems/z/resources/swprice/ Based upon a presentation from David Chase

Trademarks 2 The following are trademarks of the International Business Machines Corporation in the United States and/or other countries. AIX* BookManager* CICS* DB2* DB2 Connect DB2 Universal Database DFSORT* Domino DRDA* Encina* FICON* * Registered trademarks of IBM Corporation GDDM* HiperSockets IBM* IBM eserver IBM logo* ImagePlus* IMS Intelligent Miner Lotus* Multiprise* MQSeries The following are trademarks or registered trademarks of other companies. NetView* OS/390* Parallel Sysplex* QMF RACF* S/390* System z System z9* System z10* SystemPac* Tivoli* Java and all Java-related trademarks and logos are trademarks of Sun Microsystems, Inc., in the United States and other countries Linux is a trademark of Linus Torvalds in the united States and other countries.. UNIX is a registered trademark of The Open Group in the United States and other countries. Microsoft, Windows and Windows NT are registered trademarks of Microsoft Corporation in the United States and other countries. * All other products may be trademarks or registered trademarks of their respective companies. VisualAge* WebSphere* VSE/ESA z/architecture z/os* z/vm* z/vse zseries* NOTES: Any performance data contained in this document was determined in a controlled environment. Actual results may vary significantly and are dependent on many factors including system hardware configuration and software design and configuration. Some measurements quoted in this document may have been made on development-level systems. There is no guarantee these measurements will be the same on generally-available systems. Users of this document should verify the applicable data for their specific environment. IBM hardware products are manufactured from new parts, or new and serviceable used parts. Regardless, our warranty terms apply. Information is provided AS IS without warranty of any kind. All customer examples cited or described in this presentation are presented as illustrations of the manner in which some customers have used IBM products and the results they may have achieved. Actual environmental costs and performance characteristics will vary depending on individual customer configurations and conditions. This publication was produced in the United States. IBM may not offer the products, services or features discussed in this document in other countries, and the information may be subject to change without notice. Consult your local IBM business contact for information on the product or services available in your area. All statements regarding IBM's future direction and intent are subject to change or withdrawal without notice, and represent goals and objectives only. Information about non-ibm products is obtained from the manufacturers of those products or their published announcements. IBM has not tested those products and cannot confirm the performance, compatibility, or any other claims related to non-ibm products. Questions on the capabilities of non-ibm products should be addressed to the suppliers of those products. Prices are suggested US list prices and are subject to change without notice. Starting price may not include a hard drive, operating system or other features. Contact your IBM representative or Business Partner for the most current pricing in your geography. Any proposed use of claims in this presentation outside of the United States must be reviewed by local IBM country counsel prior to such use. The information could include technical inaccuracies or typographical errors. Changes are periodically made to the information herein; these changes will be incorporated in new editions of the publication. IBM may make improvements and/or changes in the product(s) and/or the program(s) described in this publication at any time without notice. Any references in this information to non-ibm Web sites are provided for convenience only and do not in any manner serve as an endorsement of those Web sites. The materials at those Web sites are not part of the materials for this IBM product and use of those Web sites is at your own risk. IBM makes no representation or warranty regarding third-party products or services including those designated as ServerProven, ClusterProven or BladeCenter Interoperability Program products. Support for these third-party (non-ibm) products is provided by non-ibm Manufacturers. IBM may have patents or pending patent applications covering subject matter in this document. The furnishing of this document does not give you any license to these patents. Send license inquires, in writing, to IBM Director of Licensing, IBM Corporation, New Castle Drive, Armonk, NY 10504-1785 USA.

Agenda IBM Software Pricing Framework MLC Topics Sub-Capacity Concepts Workload License Charges Optimizing for Sub-Capacity Parallel Sysplex Aggregation 3 IPLA Topics What is IPLA? What is Value Unit Pricing? IPLA Sub-Capacity Other Price/Performance Topics

Software Pricing at IBM System z: Monthly License Charges IBM Customer Agreement (ICA) with System z Attachments Monthly term license, includes maintenance Sysplex aggregation System z: IPLA (One Time Charges) International Program License Agreement (IPLA) with System z Amendments Perpetual license, annual Subscription and Support (optional) Enterprise aggregation Distributed: IPLA (One Time Charges) International Program License Agreement (IPLA) with Passport Advantage Amendments Perpetual license, S&S bundled in Y1, optional 12 mo S&S Passport Advantage Relationship Discount 4 Sub-Capacity: Oct 2000 e.g., DB2, CICS, IMS, MQSeries, Compilers, Domino, z/os, zvse Sub-Capacity: Aug 2004 e.g., WebSphere, Tivoli tools, DB2 tools, IMS tools, CICS tools, AD tools, z/vm V5, V6 Sub-Capacity: April 2005 e.g., Products that run on Unix, Windows, and also middleware for Linux on System z! Eg: WebSphere Application Server, DB2 UDB, DB2 Connect, TSM

z/os Monthly License Charges Overview WLC allows znalc allows SALC EWLC allows znalc allows SALC PSLC allows NALC * allows ULC zelc Aggregation Capable? Yes Yes Sub-Cap Capable? Yes Yes z10 EC z9 EC z990 z900 x x z10 BC z9 BC * z890 * x (plex only) x ** (w/twlc) x (plex only) z800 * x (plex only) x (w/zelc) x (plex only) x 9672 and older x 5 WLC = Workload License Charges (VWLC & FWLC) EWLC = Entry Workload License Charges PSLC = Parallel Sysplex License Charges TWLC = Tiered EWLC zelc = zseries Entry License Charges = Strategic Pricing Metric MWLC = Midrange Workload License Charges: on z10, z9 EC, z9 BC when running z/vse V4 ULC = Usage License Charges = available only for MQSeries, DB2, CICS, IMS; used when product has low utilization SALC = Select Application License Charges = available only for MQSeries; used when product has very low utilization znalc = System z New Application License Charges = available only for z/os associated w/ new workload applications * NALC is an old new workload metric being withdrawn September 2007 ** z9 BC A01 and z890-110 are priced zelc, not EWLC

Sub-Capacity Concepts 6 MLC Topic

Sub-Capacity Overview 7 100 MSU Rated Capacity LPAR 1 LPAR 2 LPAR 3 Full Capacity Pricing Charges based on Machine Capacity of machines where product runs 75 MSU 50 MSU FileMan CICS DB2 z/os 80 MSU 85MSU 90 MSU PL/I DB2 IMS z/os 55 MSU 10 MSU COBOL CICS IMS z/os Sub-Capacity Pricing Charges based on Hardware Utilization of LPARs where product runs Hourly intervals measured Rolling 4-Hour Average calculated for each combination of LPARs Charges based on Monthly Peak R4HA of appropriate LPAR combination Not based on individual Product measurement

Sub-Capacity Overview 8 100 MSU Rated Capacity LPAR 1 LPAR 2 LPAR 3 Full Capacity Pricing Charges based on Machine Capacity of machines where product runs 75 MSU 50 MSU FileMan CICS DB2 z/os 80 MSU 85MSU 90 MSU PL/I DB2 IMS z/os 55 MSU 10 MSU COBOL CICS IMS z/os Sub-Capacity Pricing Charges based on Hardware Utilization of LPARs where product runs Hourly intervals measured Rolling 4-Hour Average calculated for each combination of LPARs Charges based on Monthly Peak R4HA of appropriate LPAR combination Not based on individual Product measurement e.g. DB2 is charged 80 MSUs because LPARs 1&2 had a peak R4HA utilization of 80 MSUs and DB2 ran in LPARs 1&2, not because DB2 used 80 MSUs

9 Sub-Capacity Example System z @ 240 MSUs 140 120 SYSB actual utilization Peak R4HA Rolling 4-Hour Avg SYSB SYSA SYSB SYSC 136 MSUs MSUs 100 80 60 40 20 219 MSUs 0 A&B&C actual utilization One Month Rolling 4-Hour Avg A&B&C SCRT Report: COBOL DB2 z/os z/os z/os Product COBOL DB2 Sub-Cap MSUs 136 MSUs 136 MSUs MSUs 250 200 150 100 50 0 Peak R4HA z/os 219 MSUs One Month

Sub-Capacity Eligible z/os MLC Programs Product ID Product Name Product ID Product Name 10 5694A01 z/os V1 5655H32 Debug Tool for z/os & OS/390 5655G52 z/os.e V1 5655L24 Debug Tool for z/os V4 5655147 CICS TS for OS/390 5655M18 Debug Tool for z/os V5 5697E93 CICS TS V2 5655P14 Debug Tool for z/os V6 5655M15 CICS TS V3 for z/os 5655R44 Debug Tool for z/os V7 5655S97 CICS TS V4 5655S17 Debug Tool for z/os V8 5655DB2 DB2 for OS/390 V5 5655B22 Visual Age PL/I V2 for OS/390 5645DB2 DB2 UDB for OS/390 V6 5655H31 Enterprise PL/I V3 5675DB2 DB2 UDB for OS/390 V7 5697B82 Tivoli NetView for OS/390 5625DB2 DB2 UDB for z/os V8 5697ENV Tivoli NetView for z/os 5635DB2 DB2 V9 for z/os 5697MQZ WS MQ Extended Security Ed for z/os V5 5697NQZ WS MQ Extended Security Ed for z/os V6 5655158 IMS V6 5655B86 Lotus Domino for S/390 V5 5655B01 IMS V7 5655K36 Lotus Domino for z/os V6 5655C56 IMS V8 5655N14 Lotus Domino for z/os V7 5655J38 IMS V9 5655P97 z/os Encryption Facility for z/os V1 5635A01 IMS V10 5635A02 IMS V11 5706254 QMF MVS V3 5655A95 MQSeries V2 for OS/390 5695068 Airline Control System V2 5655F10 WebSphere MQ V5 for z/os 5748T15 z/tpf V1 5655L82 WebSphere MQ V6 for z/os 5748F15 z/tpfdf V1 5655R36 WebSphere MQ V7 for z/os 5648A25 5655G53 5655S71 COBOL for OS/390 & VM V2 Enterprise COBOL V3 Enterprise COBOL V4 Subcapacity also applied to some of the earlier versions of the listed SW.

11 Sub-Capacity WLC/EWLC Implementation MLC Topic

Downloadable Tools for Sub-Capacity 12 Sub-Capacity Planning Tool for PLANNING for Sub-Capacity http://ibm.com/systems/z/swprice/subcap/scpt processes SMF70 records analyzes data from any mainframe environment Produces a planning report used for estimating Sub-Capacity Reporting Tool for IMPLEMENTING Sub-Capacity http://ibm.com/systems/z/swprice/subcap/scrt processes SMF70 and SMF89 records analyzes data from a System z server running z/os in 64-bit Produces a Sub-Capacity Report used for billing

Sub-Capacity Planning Tool 13 =============== SUB-CAPACITY PLANNING TOOL ============== Release Date System Name Serial Number Machine Description CP Processors Capacity (MSUs) 19/10/2008 SYS1 S123456 2096-W04 4 174 SCPT only uses SMF 70 and does not know anything about used SW in the specific LPARs. If you had a product only running in LPAR1, it would require 46 MSUs. If you had a product only running in LPAR2, it would require 133 MSUs. If you had a product only running in LPAR3, it would require 3 MSUs. If you had a product only running in LPAR1 & LPAR2, it would require 168 MSUs. If you had a product only running in LPAR1 & LPAR3, it would require 49 MSUs. If you had a product only running in LPAR2 & LPAR3, it would require 135 MSUs. If you had a product running in ALL LPARs, it would require 170 MSUs. If having many LPAR this list of combinations can become very long -> You can specify a maximum size for the list.

Sub-Capacity Machine Implementation Timeline This is for a machine adopting sub-capacity for the first time. 14 Aug Sub-Cap Report (Feb 2 Mar 1) must be submitted to IBM by March 9 th - effective on Apr 1st August September October November Collect Aug Data Run Aug Report Submit Aug Report Effective Date for Aug Report Effective Date for Sep Report Effective Date for Oct Report Full-Cap Pricing Sub-Cap Pricing (Could be PSLC, zelc, WLC, EWLC) (Could be WLC, EWLC, znalc)

Sub-Capacity Reporting Tool (SCRT) Report =============== SUB-CAPACITY REPORT ============== 15 Customer Name ABC Corp Customer Number 1111111 Machine Serial Number 51-12345 Machine Type and Model 2097-604 Machine Model change observed Machine Rated Capacity (MSUs) 277 Purchase Order Number unknown =================================================================== TOOL INFORMATION Tool Release Reporting Period 18.1.1 2 Jan, 2010-1 Feb, 2010 % Data Collected 99% for 31 days =================================================================== PRODUCT SUMMARY INFORMATION Customer Customer VWLC Product Name VWLC Product ID Tool MSUs MSUs Comments z/os V1 5694-A01 253 DB2 UDB V9 5635-DB2 253 CICS TS V3 5655-M15 132 MQSeries V6 5655-L82 132 IMS V10 5635-A01 142 Tivoli NetView for z/os 5697-ENV 253 (optional) (condit.) Enterprise Cobol V4 5655-S71 60 (optional) (condit.)

Workload License Charges 16 MLC Topic

Workload License Charges* for Sub-Capacity Eligible Products Variable Workload License Charges (VWLC) for non-sub-capacity Eligible Products Flat Workload License Charges (FWLC) Variable WLC Price Structure Level Range Base 0-3 MSUs Flat WLC Structure Level 0 4-45 MSUs Level 1 46-175 MSUs per single charge server Level 2 176-315 MSUs Level 3 316-575 MSUs flat monthly pricing Level 4 576-875 MSUs Level 5 876-1315 MSUs Level 6 1316-1975 MSUs Level 7 1976+ MSUs *WLC are available on z10 EC, z9 EC, z990, z900, cumulative monthly pricing z/os in 64-bit mode required. Remove all OS/390 for a CEC to qualify plex of z10 BC, z9 BC, z890 and z800 zseries z/os 64-bit 17 Full-Cap mode - use rated MSU capacity or Sub-Cap mode - use MSU values from Sub-Capacity Reports

WLC Example 18 Product WLC Sub-Cap WLC Full-Cap PSLC COBOL 5655S71 3 273 60 MSUs 3 637 88 MSUs 3 180 88 MSUs z9 BC Model Q04 @ 88 MSUs z9 EC Model 506 @ 279 MSUs Fortran 5668805 REXX 5695013 CICS TS 5655M15 DB2 V9 5635DB2 787 Flat WLC 1 937 Flat WLC 47 562 235 MSUs 49 932 290 MSUs 787 Flat WLC 1 937 Flat WLC 60 890 367 MSUs 56 844 367 MSUs 610 88 MSUs 1 962 88 MSUs 54 916 367 MSUs 53 400 367 MSUs LPAR1 60 MSUs CICS DB2 COBOL Fortran REXX z/os LPAR2 60 MSUs DB2 z/os 230 MSUs LPAR3 175 MSUs CICS DB2 z/os z/os 5694A01 102 282 290 MSUs 116 393 367 MSUs 131 677 367 MSUs * With Model, SW model is meant -> capacity setting TOTAL 205 773 240 488 245 745 * All prices are estimates in Euro and subject to change

Entry Workload License Charges 19 MLC Topic

Entry Workload License Charges for z10 BC, z9 BC and z890 for Sub-Capacity Eligible Products Entry Workload License Charges (EWLC) for non-sub-capacity Eligible Products EWLC Tiered Price Structure 20 Full-Cap mode - use rated MSU capacity or Sub-Cap mode - use MSU values from Sub-Capacity Reports EWLC Price Structure base 3 MSUs Level 1 4-17 MSUs Level 2 18-30 MSUs Level 3 31-45 MSUs Level 4 46-87 MSUs Level 5 88-175 MSUs Level 6 176-260 MSUs Level 7 261+ MSUs cumulative monthly pricing EWLC Tiered Price Structure Excl. to z10 BC, z9 BC and z890 Tier A 1-11 MSUs Tier B 12-15 MSUs Tier C 16-40 MSUs Tier D 41-75 MSUs Tier E 76-1500 MSUs Tier F 1501+ MSUs flat monthly pricing select the tier based on the MSU rating of your box Z10 BC Z10 BC, z9 BC setting A01 and z890 setting 110 are the exceptions to this rule, they are priced using zelc

Sub-Capacity Corner Website 21 http://www.ibm.com/systems/z/resources/swprice/subcap/index.html Three primary information tabs Terms & Conditions Procedures Technology Links to other information MSU Ratings for mainframes Sub-Cap eligible MLC software Sub-Cap eligible IPLA software (including categories)

22 Optimizing Sub-Capacity for Price/Performance MLC Topic

Sub-Capacity Optimization 23 Review Sub-Capacity Reports Monthly Deploy Fewer Products per LPAR Create Extra LPARs for Specialized Purposes / Products Control LPAR Utilization Use Traditional capping (PR/SM hardcap) Reduce Number of Logical Engines Implement Defined Capacity and/or Group Capacity Limits Machine Consolidation Potentially Reduces the number of Flat WLC licenses needed Allows you to Leverage Offset Peaks

Customers MUST Review Sub-Cap Reports 24 I m so glad that my team looked over our Sub-Capacity Reports this month. We checked for problems, noticed trends, considered possible optimization activities!

Deploy Fewer Products per LPAR 25 PRODUCT GRID SNAPSHOT Product Name Product ID ONE TWO THREE FOUR FIVE SIX z/os V1 5694-A01 100.00% 100.00% 100.00% 97.90% 100.00% 100.00% DB2 UDB V9 5635-DB2 95.20% 99.80% 99.80% 97.70% 100.00% 100.00% CICS TS V3 5655-M15 57.60% 99.80% 99.80% 97.10% 100.00% 71.50% MQSeries V7 5655-R36 95.20% 99.80% 99.80% 79.80% 100.00% 99.80% IMS V10 5635-A01 99.80% 99.80% 99.80% 7.60% 100.00% Debug Tool V7 5655-R44 20.80% Does IMS V10 really need to run in LPAR FOUR? It is only running in this LPAR for 7.6% of the reporting period

26 IBM Software Group Defined Capacity 2094-506 rated @ 279 MSUs 24 Jan 10-19:15 24 Jan 10-15:45 24 Jan 10-12:15 24 Jan 10-22:45 250 200 defined capacity set at 210 MSUs (used for billing) 150 100 MSUs 50 highest rolling 4-hour average 0 24 Jan 10-21:00 24 Jan 10-17:30 24 Jan 10-14:00 24 Jan 10-10:30 24 Jan 10-08:45 24 Jan 10-07:00 24 Jan 10-05:15 24 Jan 10-03:30 24 Jan 10-01:45 24 Jan 10-00:00 SCRT reports the lower of the R4HA or Defined Capacity

Defined Capacity defined capacity set at 250 MSUs 300 250 200 150 100 50 0 Defined Capacity has no effect if R4HA never reaches it 27 16 Feb 08-07:00 17 Feb 08-07:00 21 Jan 08-07:45 22 Jan 08-07:45 23 Jan 08-07:45 24 Jan 08-07:45 25 Jan 08-07:30 26 Jan 08-07:30 27 Jan 08-07:30 28 Jan 08-07:30 29 Jan 08-07:30 30 Jan 08-07:30 31 Jan 08-07:30 01 Feb 08-07:15 02 Feb 08-07:15 03 Feb 08-07:15 04 Feb 03-07:15 05 Feb 08-07:15 06 Feb 08-07:15 07 Feb 08-07:30 08 Feb 08-07:30 09 Feb 08-07:30 10 Feb 08-07:45 11 Feb 08-07:45 12 Feb 08-07:45 13 Feb 08-07:45 14 Feb 08-07:00 15 Feb 08-07:00 MSUs highest rolling 4-hour average (used for billing) financial

Data from SCPT 28 A single day in February 2010 200 175 150 125 M SU 100 75 50 25 0 15 min Avg 4 Hour avg 0 0 :0 0 0 1 :0 0 0 2 :0 0 0 3 :0 0 0 4 :0 0 0 5 :0 0 0 6 :0 0 0 7 :0 0 0 8 :0 0 0 9 :0 0 1 0 :0 0 1 1 :0 0 1 2 :0 0 1 3 :0 0 1 4 :0 0 1 5 :0 0 1 6 :0 0 1 7 :0 0 1 8 :0 0 1 9 :0 0 2 0 :0 0 2 1 :0 0 2 2 :0 0 2 3 :0 0 Time Even without capping becoming activated, it can have a financial impact! Without CAPPING defined: reported R4HA: 157 MSU. With CAPPING defined at 150 MSU: reported R4HA: 150 MSU. (And only a few minutes real capping : around 14:30)

SCRT details 29 This SCRT section shows the number of MSU that will be charged. If all LPARs would peak at same moment: 50+54+16+103 = 223 MSU. This can be avoided through GROUP Capping.

Group Capacity Limits 30 Announced: April 18th 2007 Highlights: Available with z/os 1.8 Available for z10 EC, z9 EC & z10 BC, z9 BC only Machine Rating = 100 Group A Limit = 80 Def Cap = 60 Group B Limit = 40

Defined Capacity vs. Group Capacity Limits Goal: Limit Production to 80 MSUs & Test to 40 MSUs (Total = 120 MSUs) 31 Defined Capacity Total Production = 80 Group Capacity Limits Total Production = 80 DefCap =60 Total Test = 40 Total Test = 40 DefCap =30 DefCap =30 DefCap =30 DefCap =20 DefCap = 10 Wt 30 Wt 30 Wt 20 Wt 10 Wt 10 Machine Rating = 200 Machine Rating = 200

SCRT details 32 SCRT report also includes details about number of hours capping per LPAR / GROUP.

Offset Peaks through Server Consolidation Separate Machines: z/os total charges equal ~125 MSUs z/os charges on CECA would be ~73 MSUs z/os charges on CECB would be ~52 MSUs Consolidated Machine (A&B): z/os total charges equal ~98 MSUs 33 100 80 A B A & B MSUs 60 40 20 0 Highest rolling 4-hour average for CECA Time Highest rolling 4-hour average for CECB Highest simultaneous rolling 4-hour average for A&B

34 Parallel Sysplex Aggregation MLC Topic

Parallel Sysplex Aggregation 35 IBM Parallel Sysplex Aggregation Criteria: Hardware requirements Software requirements Operational requirements Verification requirements Applies to Parallel Sysplexes with Workload License Charges (WLC) System z New Application License Charges (znalc) Parallel Sysplex License Charges (PSLC) No-charge, Downloadable Tool for customers to determine whether their Parallel Sysplex is compliant with IBM s 50% rule http://ibm.com/zseries/swprice/sysplex

Sysplex Calculator Example MACHINE ONE - 400 MSUs 22 July 2009 @ 08:00 SYSA 100 MSUs PROD PLEX SYSB 100 MSUs PROD PLEX SYSC 100 MSUs DEV PLEX MACHINE TWO - 300 MSUs 22 July 2009 @ 08:00 SYSX 155 MSUs PROD PLEX SYSY 45 MSUs TEST SYSZ 100 MSUs DEV PLEX =============== SYSPLEX CALCULATOR =============== Release Date 20/10/2008 Customer Name ABC Corporation Machine Serial LPARs CPC1 A1111 SYSA, SYSB, SYSC CPC2 E2222 SYSX, SYSY, SYSZ Based on IBM's Parallel Sysplex Aggregation criteria, Sysplex Calculator determines that CPC1 is a member of PRODPLEX determines that CPC2 is a member of PRODPLEX Machine => CPC1 CPC1 CPC1 CPC2 LPAR => SYSA SYSB SYSC SYSX Plex => PRODPLEXPRODPLEXDEVPLEX PRODPLEX Interval 22 Jul 09-08:00 33% 33% 33% 52% 22 Jul 09-08:15 36 The z/os images participating in the above systems enablement function(s), on the same sysplex, must account for at least 50 percent of the total of the eligible operating system workload on each eligible machine.

Financial Benefits of Sysplex Aggregation Lower Cost of Incremental Growth Product Box 1 Licenses COBOL 5655-S71 Fortran 5668-805 REXX 5695-013 CICS TS V3 5655-M15 DB2 V9 5635-DB2 z/os 5694-A01 298 MSUs 298 MSUs 298 MSUs 298 MSUs 298 MSUs 298 MSUs Box 2 Licenses 240 MSUs 240 MSUs 240 MSUs WLC aggregate 298 MSUs WLC no aggregation 298 MSUs 298 MSUs 298 MSUs 298 MSUs 578 MSUs 538 MSUs 538 MSUs TOTAL 295 640/ month 298 MSUs 298 MSUs and 240 MSUs 298 MSUs and 240 MSUs 298 MSUs and 240 MSUs 400 263/ month Monthly License Charge ($/MSU) System z machine @ 298 MSUs Box 1 COBOL Fortran REXX CICS DB2 z/os INCREMENTAL MLC PRICE / SW LEVEL Level 0 Level 1 Level 2 Level 3 Level 4 Capacity (MSUs) 37 System z machine @ 240 MSUs Level 5 Box 2 CICS DB2 z/os Level 6 Level 7 *All prices are estimates in Euro and subject to change

38 What is IPLA? IPLA Topic

Software Pricing at IBM 39 System z: Monthly License Charges IBM Customer Agreement (ICA) Monthly term license, includes maintenance Sysplex aggregation Sub-Capacity: Oct 2000 e.g., DB2, CICS, IMS, MQSeries, Compilers, Domino, z/os, OS/390, z/os.e, VSE System z: IPLA (One Time Charges) International Program License Agreement (IPLA) Perpetual license, annual maintenance (optional) Enterprise aggregation Sub-Capacity: Aug 2004 e.g., WebSphere, Tivoli tools, DB2 tools, IMS tools, CICS tools, AD tools, z/vm V5, V6 Distributed: IPLA (One Time Charges) International Program License Agreement (IPLA) Perpetual license, maintenance bundled in Y1, optional 12 mo maintenance Passport Advantage Relationship Discount Sub-Capacity: April 2005 e.g., Products that run on Unix, Windows, and also middleware for Linux on System z!!!

What is Value Unit Pricing? 40 IPLA Topic

Value Unit Pricing: Benefits/Terms Value Unit Pricing Key Benefits Lower Cost of Incremental Growth Enterprise Aggregation License: One-Time-Charge granting the right to use the product Maintenance: Optional, Recurring Charge for Subscription & Support (S&S) S&S provides break/fix support S&S provides version-to-version upgrades, at no additional OTC S&S is an annual charge called Annual License Charge or ALC S&S is optional but strongly encouraged (Resumption fee applies) If purchased, S&S capacity MUST equal license capacity S&S automatically renews each year S&S may be cancelled (effective anniversary date) (Resumption fee applies) For each System z IPLA Product there is a unique product ID per version there is a common S&S product ID across all versions Product ID Product 5655-I18 Migration Utility V1 5697-I89 Migration Utility V2 5697-N44 Migration Utility V3 5655-I32 Migration Utility S&S 41

42 Value Unit Pricing: Mechanics Value Unit Pricing Converts various measurements to Value Units For each Value Unit Priced program, there is a 'Value Unit Exhibit' (VUEXXX) The 'Value Unit Exhibit' establishes the appropriate Value Unit conversion Most common conversion is MSUs to Value Units It is also possible to convert engines, messages and other measurements to Value Units Value Unit Exhibit 007 (VUE007): MSUs 1-3, need 1 VU per MSU MSUs 4-45, need.45 VUs per MSU MSUs 46-175, need.36 VUs per MSU MSUs 176-315, need.27 VUs per MSU MSUs 316+, need.20 VUs per MSU **** cumulative **** Product ID Product Price per VU 5655-I18 Migration Utility V1 1,725 / VU 5697-I89 Migration Utility V2 1,587 / VU 5697-N44 Migration Utility V3 1,746 / VU 5655-I32 Migration Utility S&S 264 / VU Other VUE Exhibits exist for eg z/vm, TWS, WBIFN, Value Unit Exhibit 001 (VUE001): MSUs 1-3, need 5.25 VUs per MSU MSUs 4-45, need.83 VUs per MSU MSUs 46-175, need.35 VUs per MSU MSUs 176-315, need.26 VUs per MSU MSUs 316+, need.20 VUs per MSU **** cumulative **** Migration Utility Examples: 100 MSUs => 42 VUs 1000 MSUs => 244 VUs Lower cost of Incremental Growth *All prices are estimates in Euro and subject to change

IPLA Aggregation Applies to all IPLA Value Unit Bases (e.g., MSUs, Engines, Users) Combines Value Unit Basis (e.g., MSUs) for all machines in customer enterprise before calculating # of VUs needed (Aggregation does not require parallel sysplex) Calculation of additional capacity uses Current Entitlement as starting point 43 Brussel 2096-S03 85 MSUs Migration Util. (5697-N44) Customer One: Deploying Migration Utility on 2096-S03 Convert total 85 MSUs to 37 Value Units Total for 37 VUs @ 1746/VU = 64 602 OTC (and 9 768 S&S) $64 602 / 85 MSUs = about 760 per MSU Gent 2096-S03 84 MSUs Migration Util. (5697-N44) Luik 2097-705 488 MSUs Migration Util. (5697-N44) Customer Two: Deploying Migration Utility on 2096-S03 and 2097-705 Convert total 572 MSUs to 159 Value Units Total for 159 VUs @ 1746/VU = $277 614 OTC (and 41 976 S&S) 277 614 / 572 MSUs = about 485 per MSU *All prices are estimates in Euro and subject to change

44 10 August 2004 Sub-Capacity Announcement IPLA Topic

System z IPLA Categories (August 2004) 45 Most System z IPLA Programs with MSU-Oriented Value Unit Pricing will fall into one of the following three categories Execution-based Where the Product executes z/os-based Where the Product executes Reference-based Where the Parent Product executes For example: Fault Analyzer For example: z/os Session Manager For example: DB2 Utilities Suite (parent is DB2) Note: uncategorized programs are usually licensed on the machine where the program executes

Sub-Capacity Ts & Cs Machines with Sub-Cap WLC or Sub-Cap EWLC Required: IPLA Amendment for System z Platform Programs Sub-Capacity Pricing Customer tracking required IBM has right to audit, initiate billing 46 Execution -based Terms For Value Unit Programs z/osbased Terms For Value Unit Programs environment = a single/stand-alone machine or a qualified Parallel Sysplex Reference -based Terms For Value Unit Programs Required license capacity equals the capacity of the LPAR(s) where the IPLA program executes Required license capacity equals the z/os capacity of the machine(s) where the IPLA program executes Required license capacity equals the capacity of the parent program across the environment Note: Product Announcement for uncategorized products will outline sub-cap terms, if there are any.

SCRT details 47 SCRT report only includes the Execution based System z IPLA SW. WebSphere Application Server: GSSP pricing GSSP eligible SW: reported MSU figure function of product usage instead of LPAR size.

SCRT details 48 z/os programs eligible for Getting Started Sub-capacity Pricing Report above shows that WebSphere Application Server for z/os V6.1 (5655-N01) Service level 16* WAS was running all the WebSphere Application Server for z/os V7.0 (5655-N02) time in eg LPAR PROD2, WebSphere Extended Deployment on z/os V6.1 (5655-P28) WebSphere Extended Deployment for z/os V6.1 by individual components (5655-S33) having R4HA of 83 MSU Websphere Process Server for z/os V6.1 (5655-N53) but only 12 MSU reported WebSphere Enterprise Service Bus for z/os V6.1 (5655-R15) because of GSSP. WebSphere Service Registry and Repository for z/os V6.1 (5655-R41) WebSphere Business Services Fabric for z/os V6.1 (5655-S30) WebSphere Message Broker for z/os V6.1 (5655-M74) Service level 2* WebSphere Portal Enable for z/os V6 (5655-R17) WebSphere Transformation Extender for z/os V8.2 (5655-R95)* Service level 2 (eligible with Command Server and with Launcher)

System z IPLA Programs Website 49 http://www-03.ibm.com/systems/z/resources/swprice/zipla/index.html

Value Unit Example 50 Program DB2 Utilities Suite Reference-based category (DB2, sysplex) Sub- Cap VUs 265 MSUs 120 VUs 86K Full-Cap VUs 324 MSUs 135 VUs 96K z9 BC Model M04 @ 45 MSUs LPAR1 z9 EC Model 506 @ 279 MSUs LPAR2 LPAR3 CICS Performance Analyzer Reference-Based category (CICS, sysplex) z/os Session Manager z/os-based category (z9 EC) Fault Analyzer Execution-Based category (LPAR 2) 210 MSUs 79 VUs 74K 230 MSUs 84 VUs 240K 60 MSUs 28 VUs 81K 324 MSUs 109 VUs 102K 279 MSUs 97 VUs 277K 279 MSUs 97 VUs 281K 35 MSUs CICS DB2 COBOL Fortran REXX z/os 60 MSUs DB2 z/os 175 MSUs 230 MSUs CICS DB2 z/os WebSphere App Server Execution-Based category (LPARs 1, 2) 95 MSUs 40 VUs 103K 324 MSUs 109 VUs 281K *All prices are estimates in Euro and subject to change

Price / Performance 51 General

52 Generation to Generation IBM Software Savings Possible The announced MSUs for SW pricing purposes on z10 EC and z9 EC servers are designed to offer improved software price/performance. Example Software MSUs for similar HW capacity z900 Sample 3 Year Savings for z10 EC SW * z990 Compared with : z9 EC z990 z900 z9 EC z10 EC K Euros 50 0 0 4 0 0 0 3 0 0 0 2 0 0 0 SW MSU Examples 100 90 81 343 309 278 1000 900 810 1371 1234 1111 73 250 729 1000 ~10% MSU reduction compared to z9 EC ~37 % higher MSU on z900! 10 0 0 0 100 500 1.000 z10 MSUs * Sample Software Stack Includes: z/os Base plus features, DB2 v9, CICS v3, IMS v10, MQ v7 * Prices are estimates in Euro and subject to change.

znalc New Pricing for New Workloads! 53 System z New Application License Charges (znalc) Attractive pricing for z/os operating system to drive qualified new workloads to the System z platform Significantly reduced compared to standard price Announce: 9 January 2007 Available: 16 March 2007 Satisfies the SoD Announced with z/os 1.7 (July 2005) IBM plans to announce a version of New Application License Charges (NALC) intended to help improve the price performance of z/os in certain new workload environments by delivering subcapacity pricing.. Some examples of approved Qualified Applications: DB2 for z/os in support of SAP from SAP AG DB2 for z/os in support of PeopleSoft from Oracle DB2 for z/os in support of Siebel from Oracle Lotus Domino for z/os

znalc a great value! znalc provides: Single Qualified New Workload pricing across System z product line LPAR-Level Granularity Sub-capacity announced and supported no need for full machine dedicated to new workload znalc Qualified New Workload Criteria replaces NALC Fixed Application List A wider choice of workloads Improved z/os pricing Incremental Price/Performance improvements including Parallel Sysplex Aggregation No separate z/os product or product number 54

Linux on System z 55

56 Linux for System z General Concepts Linux for System z Middleware is considered distributed software, engine-based pricing under Passport Advantage Sub-Capacity Licensing for distributed SW Linux for System z Middleware can run on General purpose System z engines Specialized Linux System z engines, called Integrated Facility for Linux (IFL) engines To achieve maximum value from Linux on System z, leverage z/vm for virtualization and run hundreds or possibly even thousands of Linux instances on a single System z server Linux on System z is great for: server consolidation web-enabling legacy data (the data is on DB2 on the host, right?)

Integrated Facility for Linux (IFL) 57 traditional portion 401 MSUs License Linux on zseries middleware based on number of IFL engines linux portion 2097-704 @ 401 MSUs IFL IFL Model of zseries processor indicates the MSU rating (and number of CP engines) for pricing of traditional software licenses like z/os and its middleware If an engine-based zsw IPLA product runs on any CPs it must be licensed on all the CPs. Quantity of Integrated Facility for Linux (IFL) features indicates the number of specialized Linux engines for pricing of IPLA engine-based products like z/vm v5 (and also "distributed" middleware) If an engine-based zsw IPLA product runs on any IFLs it must be licensed on all the IFLs.

Passport Advantage 58 https://www.ibm.com/software/howtobuy/passportadvantage/valueunitcalculator/vucalc.wss Above website shows number of PVU for multiple platforms. As a reference: POWER6 (550,560,570, 575, 595): 120 PVU per core.

System z Application Assist Processor (zaap) 59 zaap Special processor type dedicated exclusively for Java workloads under z/os e.g. WebSphere Enabled by System z innovative PR/SM virtualization CPs and zaaps in the same z/os LPAR Java work ONLY directed to zaaps by z/os 1.6+ Can lower cost of computing for Java technologybased application servers z10, z9, z990 and z890 only Attractively priced No IBM software charges on zaaps Required Elements z/os 1.6 or later Java SDK 1.4.1 or later zaap hardware feature

zaap Example, Sub-Capacity WLC BEFORE: 2097-605 @ 292 MSUs five CPs SYSA r4hr avg=100 J J J J J sysa needs resource SYSB AFTER: 2097-605 @ 292 MSUs five CPs + one zaap SYSA r4hr avg=75 J J J J J sysa gets resource SYSB 60 1 2 3 1 2 3 Logical View 1 2 3 z 1 2 3 1 2 3 4 5 Physical View 1 2 3 4 5 z adds zaap instead of upgrading to 606 or 607 Java workload runs on zaap engine Sub-Capacity charges for Products in SYSA reduced from 100 to 75 MSUs

System z10, z9 Integrated Information Processor (ziip) ziip Special processor type dedicated exclusively for certain DB2 workloads under z/os Enabled by System z innovative PR/SM virtualization CPs and ziips in the same z/os LPAR DB2 work ONLY directed to ziips by z/os 1.6+ 61 Can lower cost of ownership for some eligible DB2 data serving workloads System z9 and z10 only Attractively priced No IBM software charges on ziips Required Elements z/os 1.6 or later DB2 V8 for z/os ziip hardware feature ziip: can also run zaap eligible workload (z/os 1.11)

Specialty Engine Special Advantages 62 Customers do not need to re-purchase their specialty engines as they upgrade hardware from one generation to the next A generational upgrade gives them free capacity growth e.g. a zaap on a z10 EC is faster than a zaap on a z9 or z990 Specialty engines always run at full speed On servers such as the z10 EC/BC, z9 EC/BC and z890 customers can choose to have their standard engines run at less than the maximum speed e.g. a 2097-401 versus 2097-701 IFLs, zaaps and ziips all run at the maximum engine speed Hipersocket connections between z/os and IFL LPARs MUCH less effort is spent moving data between z/os and Linux LPARs compared to having external servers communicate with DB2 running on z/os

Visit the System z Software Pricing Website 63 http://www.ibm.com/systems/z/resources/swprice/index.html

64 The End Thank You