PVU, what the heck is this?  A PVU (Processor Value Unit) is a unit of measure used by IBM to determine the usage on the server. Technically, a PVU license is assigned to the Analytic Server, meaning there is a cost per core processor. Simple enough right? Not so fast. The value assigned to each core depends on hardware. Not all core processors are treated alike. It’s kind of like being taxed a little higher for a luxury automobile, the better the performance the higher the tax. A server’s Processor Value Unit count is defined by the brand, model and number of physical processors running in the server and the number of core chips per processor. In order to calculate the number of Processor Value Units, it also is necessary to refer to IBM’s PVU-per-core ratings for current processor technologies, which are updated on IBM’s website here .

http://www-01.ibm.com/software/lotus/passportadvantage/pvu_licensing_for_customers.html

It represents the server license that grants access to the basic server functions through other related user roles.

If you want to oversize your hardware for growth you may end up facing a situation where your license cost for PVU’s is a lot more than you expected. To address this issue, IBM allows you to enter a “Sub-capacity” agreement. I highly recommend you check if you have this executed! A “sub-capacity” licensing gives IBM customers who use virtual-server technology the option to license IBM products based only on the PVUs made available to the licensed software, rather than on the total PVU count for that server. Therefore, entering a sub-capacity agreement can result in significantly reduced licensing costs. However, sub-capacity licensing also requires that IBM customers meet some requirements. See

On some IBM Cognos Licenses, you can purchase either PVU or Authorized User licenses. For example, Enhance Consumer can be purchase either way. Whereas other modules, like TM1, require an Analytic Server license that is Process Value Unit to function.  When you have a choice of Processor value unit or Authorized users for the same license, what’s the difference?The distinction is that when you purchase an Authorized User license, IBM doesn’t care how many core processors you have. They only care how many named users you have. Whereas the PVU model they don’t care how many users you have, they only care about the core processors and their PVU value. The bottom line is you need to have A LOT of users to cost justify the PVU model.

Another important thing to note is when you have authorized users the Program may be installed on any number of computers or servers and each Authorized User may have simultaneous access to any number of instances of the Program at one time. So, no need for Non- Production environment licenses unless there are laws that require you to have it licensed, which is rare.  With PVU licenses, if the users are accessing a Test or a Dev environment, you will need to purchase separate Non-Production PVU licenses. Below is the link to the official licensing of IBM Cognos. You may want to study the Authorized user and Processor Value Unit sections.