1. ® IBM Software Group © 2006 IBM Corporation IBM Internal Use Only--Not to be shared outside the company until July 25, 2006 New Processor Value Unit Licensing for Middleware Evolving the Structure to Provide a Foundation for the Future Processor Value Unit Sales Scenarios

2. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 2 Sales Scenario Agenda  How to Read the Scenarios  Sales Scenarios  Pre and Post Processor Value Unit Licensing Announcement  Migrate Existing Licenses to New Servers  Acquire New Licenses  Maintenance Renewals  Sub-capacity Licenses  Sub-capacity Licensing – Additional Information

3. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 3 How To Read The Scenarios 1.Customer scenario is outlined in the box at the top  Describes what the customer wants to accomplish 2.Changes – a brief description of all the changes required in the scenario 3.System description (before & after scenario)  Blue box – system type  Pale yellow – IBM middleware installed  White rectangles with blue circles  Rectangles represent chips  Blue circles represents processor cores 4.Table summarizes the number of middleware licenses installed 5.Customer actions – summarizes the changes the customer must make to their middleware licenses

4. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 4 How To Read The Scenario Charts Description of the customer scenario Sever System Installed IBM Middleware Installed Server System Installed IBM Middleware Installed System at beginning of scenario System at end of scenario Customer Action:  Specific licensing actions required by the customer Blue circles = processor cores White rectangles = chips Changes:  Overview of all the changes required by the customer in this scenario IBM Product No. Chips Number Processor Cores License Type WebSphere244 Per Processor IBM Product No. Chips Number Processor Cores License Type WebSphere24400 Processor Value Units

5. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 5 Scenario 1: Single Hardware Platform New Purchase Customer buys a new system with x86 dual-core chips IBM System x Server DB2 Prior to 7/25 Customer Action:  Acquire 2 per processor licenses of DB2 for 4 System x processor cores before July 25th ProductChipsProcessor Cores Per Processor Licenses DB2242 Changes:  Purchase System x server  Purchase DB2 licenses for the new processors IBM System x Server DB2 Subsequent to 7/25 ProductChipsProcessor Cores Processor Value Units DB224200 Customer Action:  Acquire 200 processor value unit licenses of DB2 for 4 System x processor cores after July 25th

6. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 6 Scenario 2: Single Hardware Platform Comparison of Same Licenses Purchased Before or After Announcement Customer adds WebSphere to an x86 dual-core server already running DB2 IBM System x Server DB2 IBM System x Server WebSphere & DB2 Prior to 7/25 Subsequent to 7/25 Customer Action:  Acquire 200 processor value unit licenses of WebSphere for 4 System x processor cores ProductChipsProcessor Cores Processor Value Units DB224200 WebSphere24200 Changes:  Purchase new WebSphere processor value unit licenses ProductChipsProcessor Cores Per Processor Licenses DB2242

7. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 7 Upgrade or Transfer Existing Processor Value Unit Licenses to New Servers

8. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 8 Scenario 3: Upgrade to Larger Server Single Hardware Platform Customer upgrades from a 4-way to an 8-way System p running WebSphere ProductChipsProcessor Cores Processor Value Units WebSphere24400 ProductChipsProcessor Cores Processor Value Units WebSphere48800 Customer Action:  Acquire 400 additional processor value units of WebSphere IBM System p Server WebSphere Base Changes:  Server upgrade, adding 4 processor cores  Add WebSphere processor value unit licenses for the new processor cores Result IBM System p Server WebSphere

9. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 9 Scenario 3a: Upgrade to Larger Server Single Hardware Platform Customer upgrades from a 4-way to an 8-way System p with Quad Core Modules (QCM servers) running WebSphere ProductChipsProcessor Cores Processor Value Units WebSphere24200 ProductChipsProcessor Cores Processor Value Units WebSphere48400 Customer Action:  Acquire 200 additional processor value units of WebSphere IBM System p QCM Server WebSphere Base Changes:  Server upgrade, adding 4 processor cores (one QCM module)  Add WebSphere processor value unit licenses for the new processor cores Result IBM System p QCM Server WebSphere

10. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 10 Scenario 4: Transfer Licenses to Larger Server Different Hardware Platform Customer upgrades server from an HP ProLiant PC Server (2 single-core x86 chips) to System i with 4 processor cores running WebSphere Commerce ProductChipsProcessor Cores Processor Value Units WebSphere Commerce 22200 ProductChipsProcessor Cores Processor Value Units WebSphere Commerce 24400 Customer Action:  Acquire 200 additional processor value units of WebSphere Commerce HP ProLiant PC Server WebSphere Commerce Base Changes:  Server upgrade to System i server  Transfer existing licenses of WebSphere Commerce  Add additional licenses of WebSphere Commerce Result IBM System i Server WebSphere Commerce

11. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 11 Acquire New Licenses

12. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 12 Scenario 5: Add New Product to Existing System Single Hardware Platform -- Full Capacity Customer adds DB2 to an existing System p server running WebSphere IBM System p Server WebSphere ProductChipsProcessor Cores Processor Value Units WebSphere24400 Base ProductChipsProcessor Cores Processor Value Units WebSphere24400 DB224400 Customer Action:  Acquire 400 processor value units of DB2 Changes:  Add new DB2 licenses on all processor cores IBM System p Server WebSphere & DB2 Result

13. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 13 Scenario 6: Add Additional Server -- Same Type Single Hardware Platform -- Full Capacity Customer’s workload increases requiring additional server. Customer chooses to install an additional System x dual-core server of same type IBM System x Server DB2 IBM System x Server DB2 ProductChipsProcessor Cores Processor Value Units DB224200 Base Result ProductChipsProcessor Cores Processor Value Units DB248400 Customer Action:  Acquire 200 additional processor value units of DB2 IBM System x Server DB2 Changes:  Install additional server with 4 processor cores  Acquire new licenses for the new processors

14. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 14 Scenario 7: Add Additional Server -- Different Type Different Hardware Platform -- Full Capacity Customer’s workload increases requiring additional server. Customer has a System x dual-core server and then installs a new System p server ProductChipsProcessor Cores Processor Value Units WebSphere Portal 24200 ProductChipsProcessor Cores Processor Value Units WebSphere Portal 48600* Customer Action:  Acquire 400 additional processor value units of WebSphere Portal IBM System x Server WebSphere Portal Base IBM System x Server WebSphere Portal Result IBM System p Server WebSphere Portal Changes:  Install additional System p server with 4 processor cores  Additional WebSphere Portal licenses for new server * Total of 600 made up of 200 on System x and 400 on System p

15. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 15 Scenario 8: Add Additional Server -- Different Type Different Hardware Platform -- Full Capacity Customer’s workload increases, requiring additional server. Customer moves DB2 workload off existing server and on to new System p server ProductChipsProcessor Cores Processor Value Units WebSphere24200 DB224200 ProductChipsProcessor Cores Processor Value Units WebSphere24200 DB224400 Customer Action:  Acquire 200 additional processor value units of DB2 IBM System x Server WebSphere & DB2 Base IBM System x Server WebSphere Result IBM System p Server DB2 Changes:  Install new System p server with 4 processor cores  Transfer existing DB2 licenses to new server and acquire additional licenses

16. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 16 Maintenance Renewals

17. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 17 Scenario 9: Maintenance Renewal Full Capacity Customer’s wants to renew maintenance for existing WebSphere and DB2 on System x dual-core server ProductChipsProcessor Cores Processor Value Units WebSphere24200 DB224200 ProductChipsProcessor Cores Processor Value Units WebSphere24200 DB224200 Customer Action:  Renew maintenance on 200 processor value units of both WebSphere & DB2 IBM System x Server WebSphere & DB2 Base IBM System x Server WebSphere & DB2 Result Changes:  No system or licensing changes.

18. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 18 Sub-capacity Licenses

19. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 19 Scenario 10: Add Sub-capacity licenses Same Hardware Platform -- Sub-Capacity Customer wants to add an additional sub-capacity license to an existing System p server running WebSphere MQ ProductChipsProcessor Cores Processor Value Units WebSphere MQ 12200 ProductChipsProcessor Cores Processor Value Units WebSphere MQ 23300 Customer Action:  Acquire 100 additional processor value units of WebSphere MQ Changes:  Increase hardware partition size  Order additional WebSphere MQ license Result IBM System p Server MQ Base IBM System p Server MQ

20. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 20 Scenario 11: Consolidate Servers -- Same Type Same Hardware Platform -- Sub-Capacity Customer consolidates 2 smaller systems of same type onto a single larger system, utilizing sub-capacity on the consolidated server ProductChipsProcessor Cores Processor Value Units WebSphere24400 DB224400 ProductChipsProcessor Cores Processor Value Units WebSphere24400 DB224400 Customer Action:  No additional processor value units required Base Sun Fire WebSphere Sun Fire DB2 Changes:  Install new larger server, implementing hardware partitioning  Convert existing DB2 & WebSphere licenses to sub-capacity licenses  Transfer DB2 & WebSphere licenses to larger server Result Sun Fire DB2 WebSphere

21. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 21 Scenario 12: Consolidate Servers -- Different Type Different Hardware Platform -- Sub-Capacity Customer consolidates 2 smaller systems onto a single larger System p server, utilizing sub-capacity on the consolidated server ProductChipsProcessor Cores Processor Value Units WebSphere24400 DB224400 ProductChipsProcessor Cores Processor Value Units WebSphere23300 DB223300 Customer Action:  No additional processor value units required; 100 licenses redeployed Base Sun Fire WebSphere HP 9000 DB2 Changes:  Install new System p server, implementing hardware partitioning  Convert existing DB2 & WebSphere licenses to sub-capacity licenses  Transfer DB2 & WebSphere licenses to larger server Result IBM System p DB2 WebSphere

22. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 22 Sub-capacity Licensing – Additional Information  Sub-capacity licenses also use processor value unit license structure  Sub-capacity part numbers have also been replaced  Existing process remains the same except:  Compliance tool (IBM Tivoli License Compliance Manager) will not report processor value units until 1H2007  Conversion to Processor Value Units occurs when the customer uploads the usage report quarterly

23. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 23 Sub-capacity Licensing For Distributed Systems New Sys  Sub-capacity licensing available for selected WebSphere and DB2 offerings that run on:  UNIX (AIX, HP-UX, and Sun Solaris)  i5/OS, OS/400  Linux (iSeries, pSeries, zSeries)  x86 (VMware ESX Server, VMware GSX Server, Microsoft Virtual Server) – Announced April 25 th, 2006  List of participating offerings on Passport AdvantagePassport Advantage  Track compliance using IBM Tivoli License Compliance Manager for IBM Software V2.2  Free version to support IBM software that supports selected partitioning technologies  Submit reports to IBM quarterly Application A – 2 processor licenses Application B – 4 processor licenses Application C – 8 processor licenses

24. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 24 Sub-capacity Licensing Enhanced April 25, 2006  Supports sub-capacity on x86 systems using:  VMware ESX Server  VMware GSX Server  Microsoft Virtual Server  Supports Solaris 10 (Containers) and HP-UX 11i vPAR partitioning technologies  Allows Itanium (HP-UX 11iv2) customers to run sub-capacity under trust model until ITLCM 2.3 is released in 1H2007  Announces IBM Tivoli License Compliance Manager for IBM Software V2.2 as the monitoring tool for sub-capacity licensing

25. Processor Value Unit Sales Scenarios Internal Use Only--Not to be shared outside the company until July 25, 2006 25 Reference Table: Processor Value Unit Assignment VendorSever BrandProcessor Value Units per processor core IBMSystem i100 System p100 System p QCM50 System x50 Hewlett-PackardProLiant50 9000100 SunSunFire100 The following table shows the processor value unit assignment for each server referenced in this presentation: