IBM Cognos Licensing Audit – Steps For Compliance

IBM Cognos Licensing Audit – Steps For Compliance

A Cognos Licensing audit for any software can become a very stressful time for administrators as they scramble to provide information and pray they are in compliance.  Below are a few steps to help ensure that you are in compliance if IBM Cognos decides to audit you.

  1. Call your IBM Cognos partner or sales rep and ask for your entitlements.  This will give you a rundown of all the licenses you own and you can use this information to compare against your production system.
  2. Speaking of production systems….make sure you utilize a production and a development system.  There are many advantages to this and concerning licenses, it is really important.  In a development environment, you are able to have as many users as you need to test, etc.  If you only have a production environment, any user you add counts toward your licensing.  In my case, years ago, I set up a number of employees to test security groups and access, with the intent that they would never use Cognos.  Those setups cost me licenses and, thus, put me over my license count.
  3. Clean up old users now.  Employees and Cognos users come and go, so make sure you keep you user area clean of old users.  This will help speed up an audit and help ensure you are in compliance.
  4. If you are over your entitlements, contact your IBM Business Partner now and discuss your options.   They may be able to add licenses and save you money somewhere else or, at the least, will help you get back into compliance to avoid penalties with IBM.
  5. Keep track of all users and compare to your entitlements.  Sounds simple, but by the time you realize you added 10 more users, it may be too late and you are over the limit and an audit is about to begin.

Ibm Passport Advantage Agreement Changes

IBM Cognos purchases are governed by the IBM Passport Advantage terms.  IBM recently announced IBM Passport Advantage Agreement changes which are designed principally to support the expanding offerings available under the program.  Changes automatically become effective on July 18, 2011, unless you notify IBM in writing prior to that date, that you disagree with the change.

You can find a copy of the agreement at :


Please carefully review the information for changes and enhancements being made.  I wanted to bring to your attention a few that will affect my IBM Cognos clients.

• Virtualization Licensing (also called “Subcapacity Licensing”). Terms related to Virtualization Licensing that have been separately available for many years, and that have been included with all new enrollments since 2005, have now been incorporated into the Agreement, making this rapidly-expanding technology solution available to all customers without separate action being required.

(Note: Subcapacity Licensing  is beneficial if you are investing in IBM Cognos PVU licensing and want to purchase beefier hardware to accommodate growth but don’t want to buy the extra PVU licenses. )

•Renewal of Software Subscription and Support. To protect customers from accidentally becoming noncompliant with the terms of the Agreement, it will now be required that for each Passport Advantage Site, the renewal of Software Subscription and Support for a particular product must either be for all licenses currently in service, or for none at all.

(Note:  The language states “licenses currently in service”, I believe this means if you have licenses not being utilized you can terminate those, but we have not received confirmation of that from IBM yet. )

In addition to the major enhancements, the IBM Passport Advantage Agreement has been generally reorganized and sections related to compliance, taxes, data privacy and security have been updated to make it easier to read and to better align with other IBM Agreements that you may have in place.

For more information, please visit the IBM Web site at or contact Lodestar Solutions at  813-415-2910.

IBM Support Renewal Through Lodestar Solutions!

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

Buying Cognos Licenses – IBM Reseller or IBM Direct?

As an IBM Cognos Premier Reseller, Lodestar Solutions takes the time to fully understand the ever changing licensing structure from IBM Cognos.  We educate our clients on the licensing thru webinars, blogs and personal conversations. Below are some key benefits to working with a reseller like Lodestar Solutions for buying Cognos licenses:

Competitive Prices: We have very competitive prices and can meet or beat quotes offered by IBM Cognos directly.

Certified Sales Team: Our sales team members are certified not only in selling Cognos but certified as consultants on the functionality of the software.  Our understanding of the functionality each Cognos  license has helped our clients realize substantial savings by ensuring they have the correct product mix and don’t purchase unnecessary licenses.

Tax Laws: We recommend our clients explore state tax laws in the state they are going to purchase their licenses.  There are often times tax loop holes in which Cognos licenses are not taxed.  Many states don’t charge tax if software is downloaded, so we make sure the orders clearly state delivery via download only.  Other states have unique tests to determine if the software is taxable.  Whenever possible we will help you to meet state tax the guidelines.

License terms are with IBM:  The terms of the IBM Cognos  licenses you purchase from Lodestar Solutions are the same terms you will get directly from IBM.  All clients are processed under the IBM license agreements in either IBM Passport Advantage or IBM Passport Advantage Express.

Education on License Changes: Periodically IBM changes the licensing structures, and Lodestar educates all clients on the changes and how they could be affected.  For example, in the Spring of 2010, IBM changed their Cognos Planning Contributor licenses to include the ability to have TM1 Contributor Functionality.  This required a license migration and Lodestar has guided a number of clients thru the process giving them added functionality at no cost.

Education on Functionality and IBM Cognos offerings: As a client of Lodestar Solutions, you will receive valuable information about local events, educational webinars, and new programs related to Cognos.   We inform clients on IBM offerings like the FREE IBM Cognos blueprints that are available from the innovation center.

There are many benefits from purchasing IBM Cognos licenses from a reseller like Lodestars Solutions.  We would be happy to help you.  For more information on licenses please contact us at 813-415-2910.

Save Money on BI Purchase – Part 1

Part 1 of Save Money on BI Purchase – As a licensed attorney with 20+ years in the software industry, I’ve decided to share the secrets of saving money on major software purchases. Here’s what the software companies don’t tell you and what you need to know to negotiate a contract…

1. Buying from a Reseller – Many software companies have a channel of partners that they authorize to resell and implement their solutions. These organizations get a margin from the software company to resell the software. You probably think “why would I go to them when I can go direct, and get the best deal.” Direct is not always the best deal.

Secret 1: Most resellers don’t make their money selling software, they are really consulting firms and their profit margins are much better on services. They want you to get a great deal on the software so there are more funds for the implementation of the software. Believe it or not, resellers can often sell for less than the software manufacture, because resellers don’t need layers of management’s approval to give you a great deal.

Secret 2: Because resellers are typically smaller companies whose livelihood is successful implementations, they care that you have the correct product mix. Huge sums of dollars are spent each year on Shelf-ware (software purchased and never used), because Direct Software Sales people are sales people and rarely really understand the software and licenses needed for your project. Resellers are committed to your success – after the contract is signed, they will still be working with you, whereas the Direct Software Sales person will most likely be assigned a new territory of accounts right after you sign.

2. Time to Buy – Software companies are famous for the quarter end discounts because their bonuses are based on the quarter. So find out when the quarter ends for the software manufacture and plan accordingly.

Secret 3: Resellers often don’t care about the quarter end and are willing to give you the great deals all year round.

3. Sales Tax –Did you know not all software is taxed? Many software companies will automatically charge you sales tax because it safe. They don’t have to keep up with the ever changing state laws and clients don’t usually question it.

Secret 4: Many states have loop-holes that allow you to avoid sales tax on major software purchases. For example some states don’t tax software if the client never receives media (ie CD, Disc or Tape). In those states, you want to make sure the vendor only lets you download the software and doesn’t send you a CD. Illinois has a five part test to determine if a software purchase is taxable, so you want to make sure your purchase contract meets the five part test of Title 86 Part 130 Section 130.1935 of the IL Revenue Code. Do your homework as state rules are ever changing as states scramble for funds. But the 7-10% savings on your purchase makes the research time worth it.

Stay tuned as our next posting will cover 4 more tips and secrets on how your organization can Save Money on BI Purchase