Cognos Support

Why is the quote for IBM Cognos Licenses higher than my Renewal?

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IBM Cognos Licenses
August 1, 2019

A Cognos Planning Analytics client recently asked Lodestar Solutions for a quote for a few more licenses.  When their Cognos representative sent them the quote they asked, “Why is the quote for my IBM Cognos licenses higher than my renewal?” Lodestar Solutions get’s this question periodically so we thought we would share the answer with everyone!

Assumption

For the discussion below we are focusing on premise licenses, not cloud or SAAS licensing.  If you are unfamiliar with the difference, please see our previous blog on this topic.  

 If you are uncertain what you own, email Lodestar at Renewals@lodestarsolutions.com and we can help you understand your current licensing.

The Renewal Quote

The renewal quote is just that a quote that covers just the support on the licenses you already purchased.  By subscribing to IBM Cognos Support you are able to log cases, get patches and upgrade to the latest version of the software.  The renewal or support price is always significantly lower than the cost of a new license.  So, if you need to add additional users it will cost you more than the Cognos renewal cost.  Here’s a blog on reducing your IBM support renewal costs​.

You also might like to check out more information on IBM Support. 

The New Cognos User Quote

If you need additional IBM Cognos licenses and you are using on-premise software, you will typically want to buy the “perpetual” IBM Cognos license. The new IBM Cognos license includes the cost of the licenses and it includes 1 year of support for the new Cognos licenses.  Therefore, the cost of buying new IBM Cognos licenses is more expensive than just the renewal or support subscription.  The new Cognos license is technically an asset/capex to the organization whereas the support is typically an operating expense.

Perpetual License

You may be unfamiliar with the term perpetual software license. A perpetual software license authorizes an individual to use a program indefinitely. Typically, software companies, like IBM will charge an annual support cost to get access to patches and upgrades. When you buy a perpetual license it’s an asset to your organization, you own it, even if you don’t pay support in future years. In theory, if for some reason, which we don’t recommend, you decided to not renew your IBM Cognos support on the licenses you own, you would have a legal right to still use the software for as long as you like.  However, you would not have access to any new versions of Cognos or access to log a support ticket.  Hypothetically, if Microsoft gave an update to Excel that broke a connection to Cognos TM1 or BI, you would be out of luck if you did not pay support. Renew support!

For the details of IBM licensing click here.

Conclusion

Now you know the answer to “Why is the quote for Cognos licenses higher than my renewal?”  It’s because new licenses have the license and the renewal costs included.  If you have questions on your specific licenses, reach out to Renewals@lodestarsolutions.com and we are happy to answer your questions or provide you a quote on new licenses.

Who Doesn’t Like Top Notch Service? Call Lodestar’s Concierge Service For The Best!

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5/18/2017
concierge service

Concierge Service? Sign me up!

Do you find yourself running into Cognos road blocks from time to time? Maybe you just need a quick answer to an easy fix? Could it be that you have a simple question that you don't want to have to call IBM Support for? Well then you have come to the right place! Lodestar Solutions is excited to announce their new Concierge Service offering! If you are a new client or a new support renewal at Lodestar you may qualify for this amazing service. Now you are probably wondering how do I qualify for this service? You'll just have to keep on reading...

To qualify for our Concierge Service you must be one of the following:

  1. A net new Cognos customer for Lodestar Solutions
  2. A net new renewal client for Lodestar Solutions

If you are either one of the above please contact sales@lodestarsolutions.com. If you are a current Cognos shop we'll give you a comprehensive one hour What The Heck Do I Own session to learn more about your software investment and our Concierge offering. We can offer discounts from IBM pricing on your next Cognos support renewal bill. Trust me, you won't want to miss out on this amazing opportunity! 

Lodestar Solutions will quickly become a trusted advisor in your free one hour What The Heck Do I Own session. In this one hour session, Lodestar's Sales Team will take you through a thorough software entitlement review. This review will help to make sure your company is licensed properly, determine if any licenses can be dropped, or if you need to add additional user counts. 

After all, who doesn't like impeccable service at all times? Lodestar's Concierge Service will make your life easier by knowing that we are only an email or phone call away with an answer to your Cognos question. Don't miss out on this exciting opportunity, email us at services@lodestarsolutions.com! 

If you haven't gotten the opportunity to check out our Cognos Clubs please follow the link below. Our Cognos Clubs are packed full of videos and various things you may not have already known about! 

Always remember, what are the costs associated with bad service? Come to us for best in class Cognos service. We look forward to working with you and your company! ​

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Save money on IBM Support Renewals

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For many of you, it is support renewal time with IBM Cognos but do you even see the bill to review it?  Does the invoice go to accounts payable and they just pay the bill?  You may not realize a brief review of your bill could save you thousands of dollars.   Here are some steps Lodestar Solutions can help you with how to save money on IBM Support

1. AMOUNT INCREASE – Review your invoice in comparison to the prior year’s bill.  Look to see how substantial the increase is, and if it seems high, Lodestar Solutions can help get the increase down to a tolerable amount.  You should also check if you negotiated special terms when you purchased the software that protected your support increase.  If you have special terms, make sure the increase is what was negotiated.
2. REVIEW YOUR PRODUCT MIX – Do you even know what each license does and if you need it?  IBM has different licensing rules than Cognos previously had.  For example, if your BI licenses are all Authorized Users you probably do not need a Non-Prod BI license, whereas Cognos required it. Lodestar Solutions would be happy to walk you through what you own, what it does, and areas you might want to consider trading up.   A common trade-up license is to move from Consumer to Enhanced Consumer as it provides access to a lot of the new C10 functionality.
3. CHECK YOUR STATE SALES TAX RULES – Lodestar Solutions makes an effort to understand the software tax laws in your state and make recommendations that can save you money.  Some states have a download only exemption from Sales Tax even for canned software; GA, VA, and FL are a few, but watch out!  You have to have the correct paperwork on file with IBM to protect yourself in the case of a sales tax or use tax audit.  Most vendors just charge the state sales tax and don’t dig deeper to find out if it is applicable to what they are selling.
4. RESELLERS OFFER DISCOUNTS – As a reseller of IBM support, we have the right to provide prices lower than IBM by giving up some of our margin we receive for selling support.
5. DIVERSIFIED SUPPLIER – Check with your purchasing department if your organization tracks purchases from Diversity/Minority Suppliers.  Many do, especially if you are a government contractor.  Lodestar Solutions is certified by the WBENC as a woman owned small business.  By purchasing from a diversity supplier, you earn the credits your organization may need to satisfy state and federal contracts.
6. DON’T WAIT UNTIL THE LAST MINUTE – Plan ahead and request a support quote early; it will give us time to save you money.

For a competitive quote on you IBM Support Renewal, or to consolidate multiple IBM Support bills into one, contact renewals@lodestarsolutions.com.

How Much Does IBM Cognos Support Cost When I Purchase Cognos?

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Allocation of support/maintenance costs from purchase of Cognos… IBM doesn’t haven on official statement on the break out of support as a percentage of the purchase price. In fact, IBM typically will respond that the first year of support is included in the purchase price.

This response does not help when the client is trying to apply the rules of accounting and needs to break out the cost. So let’s take a look at the costs. When you purchase IBM Cognos software, the purchase price includes one year of IBM Cognos support and the second year is 20% of the listed price of the software. If you work with Lodestar Solutions for your support renewal, we can help negotiate your support and get you certain discounts; however the list cost of the second year support is 20% of the listed price. So, let’s say we purchased $100,000 of software, year two support would be $20,000. Therefore, if we subtract $20,000 from the $100,000 for year one, we see the software cost is $80,000. Now divide the $20,000 in support cost by the $80,000 of software. As a result, we realize first year support is closer to 25% of the license portion of the purchase. Thus, you can determine if you believe the support for help desk, website knowledge base updates, etc. in year one is 25% and the subscription or license is 75%.

Note this is not to be deemed legal or professional accounting advice, but for a reference point. Talk to your tax professions to determine how you will account for the purchase.

Buying Benefits: VAR Versus OEM Vendors

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Buying Benefits: VAR Versus OEM Vendors

Most Business Intelligence vendors have a number of distribution channels.  They sell direct, thru Value Added Resellers (VARs), and thru Original Equipment Manufacturers (OEMs).  We will discuss VAR versus OEM vendors in this blog.

OEM is a misleading term for a company that has a special relationship with the Business Intelligence Vendor. OEMs are manufacturers of hardware or software who resell another company's product under their own name and branding.

RESTRICTED LICENSE FROM OEM

Oftentimes, an OEM can sell the licenses cheaper than a VAR or the Business Intelligence vendor themselves.  But there’s a catch!  The majority of the time the OEM is selling a “restricted use license” and that’s why they sell it cheaper.  The restrictions are not always communicated to the purchaser.  For example, IBM Cognos has OEM relations where the client that purchases the Cognos licenses from the OEM are restricted to using ONLY the data from the OEM’s system in Cognos.

LIMITED SUPPORT

Typically, the client will have to call the OEM for support and not the manufacturer of the software.  For example, clients that buy IBM Cognos from an OEM are usually only allowed to call the OEM – not IBM Cognos to solve their issues.  This can cause delayed responses as the OEM will not have the latest bug and patch fix information.   Additionally, OEM’s do not usually support the latest version of the software and sometimes restrict some of the functionality. So, if you buy from an OEM be educated on the restrictions.

When purchasing software from a Premier reselling partner, you purchase a full use license that allows you to access data from any subsystems.  A successful Business Intelligence / Dashboarding implementation will require data from multiple sources like your POS, GL, Inventory systems….  By investing in the full use license, you will be able to include data from a company you acquire or merge with very rapidly without having to migrate them to your GL or other subsystem.  This will provide you with rapid reporting on the merged or acquired organization.

When you purchase software from Lodestar Solutions, we can usually sell the software cheaper than the software manufacturer.  I know that sounds odd, but as a reseller we are given a small margin for our efforts.  We have the option to pass on some of our margin to the customer allowing us to sell it cheaper than the manufacturer.    Lodestar Solutions will also guide you so you can ask the correct questions about sales tax.  Many states don’t tax business intelligence software or annual support.  Knowing the sales tax rules could save you up to 10%.

By purchasing from us, you will still get direct access to the software support of the manufacturer and you will also have access to our team of certified consultants.

So, be the educated consumer when it comes to Business Intelligence software.  Purchasing from a reseller like Lodestar Solutions can save you a lot of money in the long run.  You can read more about this topic in another blog article.

Allocating Software Maintenance Costs From Purchase Price

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Most of the major software vendors sell their licenses and include the first year of support and maintenance.  As a client, your accounting department will probably ask you to separate out the support and maintenance costs from the license cost.  So, you ask your vendor to break it out and they may respond that there is no break out as it’s included. Let’s discuss how & why the accountants should be allocating software maintenance costs from the purchase price in the first place.  Accountants are governed by the AICPA guidelines, SOP 98-1 that basically states that they need to allocate the maintenance costs out of the purchase.  They then need to expense the maintenance where the license is capitalized and therefore amortized over a number of years.

So, what if the vendor doesn’t give you the breakdown? Then it’s up to you and the accountants to come up with an allocation of costs.

Allocating the Costs:

I suggest you look at the cost of support in year two being typically between 18%-20% of the purchase price.  You may decide this is the amount you will allocate to maintenance costs.

This link will shed some light on why accounts need the breakdown.

Highlights from the link above:

SEPARATING MULTIPLE ELEMENTS

Perhaps the situation that will require the most judgment is when entities purchase internal-use software and the package includes software training, maintenance, data conversion, reengineering or rights to unspecified future upgrades. The purchase price may cover some or all of the features the seller provides.

Entities must allocate the purchase price among the individual package elements based on objective evidence of their fair values. Even if the contract breaks out the purchase price by element, that itemization still may not be a good enough measure of fair value (because some sellers may be willing to break out the purchase price any way just as long as they get their price).  Should you need more info on allocating software maintenance costs from the purchase price, feel free to email us at Sales@LodestarSolutions.com.

Why The IBM Cognos Support Renewal Rate Increase?

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IBM Cognos Support Renewal billDid you get your IBM Cognos support renewal bill recently and fall off your chair?  Well pick yourself up off the floor because I can help.   You, my friend, are a victim of a not so efficient process … but not to worry.  With a few easy steps and understanding the situation, it can be resolved.

The issue arises primarily for older “Cognos” clients who purchased a large number of licenses initially and negotiated a heck of a deal.  Cognos, prior to IBM, typically charged clients 20% of their purchase price for year 2 of support.  So, if you negotiated steep discounts on the software purchase you would benefit from a lower support bill in future years.  Depending on the contract, the support cost did increase over the years but typically around 5-10%.

When IBM purchased Cognos they began, as I call it, IBMizing Cognos, which means they started to apply the rules they have for other IBM software brands to Cognos.

Some of the changes included standardizing definitions like “Authorized user”, “PVU” and when a  “Non-Production environment” license is required.  IBM standardization also includes charging support renewal rates of 20% of list price so all clients pay the same rate for the support services and software upgrades from IBM Cognos.   The change from 20% of purchase price to 20% of list price can be significant if you negotiated a large discount on the original purchase.  So, when you open your IBM Cognos support renewal bill you most likely will see that the bill is 20% of list price because that’s how the system generates the bill.  I had a client that had an 881% increase in their bill from last year.  You can imagine their shock.

Lodestar Solutions can help!  We can work with you and IBM Cognos support renewal to reduce the bill typically to about 15% increase over last year.  As part of this process, Lodestar Solutions will provide competitive IBM Support Renewal Rate, educate you on IBM Cognos Licensing and functionality and review your license mix to make sure you have the quantity and type of licenses.  Note that all support is still provided by IBM directly and is subject to your IBM Cognos Contract terms.

To save money on IBM Cognos Support Renewals with Lodestar Solutions, call us at 813-415-2910 or email hcole@lodestarsolutions.com.

OTHER BLOGS YOU MAY WANT TO REFERENCE.
Should I continue IBM Cognos Support
IBM Cognos Support Renewal from Lodestar
Where’s the Secret Decoder Ring for IBM Cognos Licensing?

IBM Support Renewal Through Lodestar Solutions!

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IBM has recently approved Lodestar Solutions to resell a IBM Support renewal.  This is great news for IBM Cognos clients looking for competitive prices on their IBM Cognos Support renewal.

Effective April 1, 2011, Lodestar Solutions can help you with all of your IBM support renewal needs.
The benefits are:

  • Competitive IBM support renewal quotes
  • Support Service is still supplied by IBM direct
  • Quotes to Trade-up Cognos licenses to licenses that get the benefit of new C10 functionality
  • Educate you on IBM Cognos license functionality
  • Review your license mix to make sure you have the most advantageous product mix for your business needs
  • Competitive Quotes for additional licenses

IBM Support Renewal

How to get a quote:
Call Lodestar Solutions at 813-415-2910 or email hcole@lodestarsolutions.com.

Should I continue IBM Cognos Support?

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I am repeatedly asked by clients whether they should continue IBM Cognos Support.   I am a big believer in maintaining IBM Cognos Support as there are a number of benefits.  Many benefits clients don’t even know exist.  There are three basic levels of IBM Cognos Support – Standard, Advantage, and Premier.
Most clients have Standard Support, so I’ll focus on the benefits associated with standard support.

BENEFITS:
New Releases
The biggest benefit is access to new maintenance releases.   As long as you continue support, you have the right to upgrade your software to the new maintenance release.  Please note that when significant functionality is added, there may be a migration fee or a need to upgrade your licenses to get this new functionality.
Support
As long as you continue to be supported, you will have access to contact IBM Cognos Support if you have issues.  Clients have on-line support access to service request management and research issues in the knowledge base.  If you are designated as a support contact for your organization, you have the ability to log service requests via the web or phone.  There are different levels of designation which are primary, secondary and authorized caller.
See the chart from the IBM Cognos Support Plans Guide:
What happens if you let IBM Cognos support lapse?
You will not get access to support and will not be able to upgrade your licenses.  If you recently lapsed, we recommend you contact your support renewal representative and try to get reinstated.  You may be penalized for letting it lapse.  If your support lapsed a long time ago and you want support or to upgrade, contact Lodestar Solutions and we can provide you a competitive quote on new licenses.
Should I pay for support for licenses I am not currently using?
That depends on if you think you will use them.  The prices for IBM Cognos have increased, so if you let maintenance lapse on some of the licenses and you decide you want to use them later, you will be required to purchase new licenses at a higher price.  IBM Cognos Maintenance is 20% of the purchase price and it’s a lot cheaper to pay maintenance instead of buying new.   I recommend you evaluate if other departments in your organization may need licenses or see if you can expand IBM Cognos to solve another business issue.
If you need more information please check out IBM Cognos Support.
The below chart is from the IBM Cognos Support Plan Guide:

Help Navigating IBM Cognos Support

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Help navigating IBM Cognos Support

For those of us who come from the Cognos world and were just getting the hang of how to find answers to the most cryptic error messages known to man, I have news for you.  Forget every trick you learned of navigating the Cognos Support system and welcome to the IBM Super Highway of Information a.k.a. IBM.com.

This is a much needed blog for two reasons:

1. To forewarn any IBM client; DO NOT WAIT on getting your IBM.com ID setup until you have a production down issue. This process takes about 5 business days to complete.

2. Provide you the quick and dirty steps to get setup painlessly and quickly (relatively speaking).

First, where do you start?  Here is a tip. This email address is the save all, end all.  This email address is who you contact if you don’t know what your Site ID is, who your primary user is and other somewhat pressing issues.  Keep this in a safe place. tsmail@us.ibm.com

This is what you will need:

1. Your IBM Customer Number (ICN)
2. The name of your primary account holder
3. Patience, my friend, patience

I don’t have my ICN  or IBM Customer Number, what do I do?
You can handle this two ways, you can send out smoke signals for your IBM rep or you can email tsmail@us.ibm.com.  I would suggest the latter.

I also have no idea who my primary account holder is!
This was the main person that was setup with Cognos support when you purchased the software.  In many cases, that person may have moved on to another position or company.  Again if you are unsure, email tsmail@us.ibm.com and inquire who this person may be.

With those three things in hand, you can now get started.

1. Login to many of the IBM pages and register for a new profile. Your ID has to be your email address.  Here is the link.

You will setup your ID, which will be your email address.  The email address MUST be the primary account holder.  If that person is no longer with the company, you must update that information FIRST; otherwise all of this will be in vain.  Contact the tsmail@us.ibm.com email listed above to change the primary contact information.

Choose a password and secret security question.

Within 24 hours you should receive an email stating your ID has been activated.  Check your spam/junk email folder, sometimes IBM gets thrown in there.

Once you get that email, login with your new ID (Email) and confirm the Authorized User. You will have to do this the first time for the Authorized User.  After that, you can repeat this process for other contacts.  Also, if you work with a Business Partner that helps you out with Technical/Support related issues, I strongly suggest you grant them access as well.  For step by step instructions on how to complete this, please email services@lodestarsolutions.com.

Once the Authorized User is confirmed, you will need to link your account as an AUTHORIZED USER to your ICN (IBM Customer Number – 9 digit account number) account.It takes about 2 days to link your ID to your ICN.  Once that is done, you should be good to go.

There is a whole website in IBM dedicated to this process. It provides insight on how to open a new service request, how to search errors, etc.  It should only take about 15 minutes to glance through it but it should help somewhat with the transition.  You can find the guide here.

To access Cognos Support use this link.

A word to the wise, once you find an IBM site bookmark it in case you ever need it again.  IBM.com is a wealth of information, which tends to be a gift and a curse.  When looking for something specific, it is sometimes easier to find it on a Google search than an IBM.com search. Keep in mind that IBM has several product lines, so always include the word Cognos in your search criterion.

Also, check out our blogs and video archived events.  A recorded webinar will be posted about this and several other processes to make your job and life easier.

Best of luck.  May the force be with you!

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