IBM Passport Advantage and the changes in 2023.

IBM Passport Advantage is:

  • A program by IBM for acquiring software.
  • Provides a flexible and cost-effective purchasing method.
  • Simplifies IBM software product licensing and management.
  • Designed for diverse customer needs.

Understanding IBM Passport Advantage

IBM Passport Advantage

IBM Passport Advantage is a comprehensive licensing program designed to offer streamlined and efficient purchasing and management of IBM software licenses.

This program is vital for businesses that use IBM software, and it has several key aspects:

  • Comprehensive Licensing Program: Passport Advantage is a program that encompasses a wide range of IBM products and services. It’s a one-stop solution for clients to order eligible products (EPs), making it simpler to manage software licenses across an organization​​.
  • Flexible Pricing and Volume Discounts: One of the critical benefits of Passport Advantage is the Relationship-suggested Volume pricing (RSVP). This pricing model offers discounts based on the volume of purchases, meaning the more IBM products you buy, the more you save​​.
  • Program Options: There are two variations of the program: Passport Advantage (PA) and Passport Advantage Express (PAE). The PA is generally more suited to larger organizations with more complex licensing needs, while the PAE is tailored for smaller businesses or those with simpler requirements​​.
  • Enrollment and Management: Enrollment in Passport Advantage is straightforward and can be done online. This process allows businesses to easily add new sites to their existing agreement, ensuring all their IBM software needs are centralized under one agreement​​.
  • Online Tools for Management: Passport Advantage Online (PAO) provides a secure, web-based tool for managing Passport Advantage transactions and account information. It offers site-specific data and a host of tools to efficiently manage licensing agreements and ensure compliance​. ​​

How IBM Software Integrates with IBM Passport Advantage

How IBM Software Integrates with IBM Passport Advantage

IBM Passport Advantage is the foundational licensing and purchasing platform for all IBM software products, streamlining the procurement process for businesses.

  • Consistent Purchasing Process: When purchasing IBM software, businesses use the Passport Advantage program, ensuring a uniform and efficient buying experience across various IBM software offerings.
  • Unified Licensing Terms: The program provides a singular set of terms and conditions for all IBM software licenses. This unification means that regardless of the type or quantity of IBM software a business uses, all licenses can be managed under one comprehensive agreement.

Deep Dive into the IBM Passport Advantage Program

Deep Dive into the IBM Passport Advantage Program

The IBM Passport Advantage program is tailored to enhance the management of IBM software licenses, offering various services and benefits for effective software asset management.

  • Comprehensive and Flexible: Designed to aid businesses in effectively managing their IBM software licenses.
  • Supports Diverse Business Needs: Catering to various company sizes and types, from small enterprises to large corporations.

Detailed Explanation of the Passport Advantage Program

IBM Passport Advantage is a volume licensing program designed to offer businesses a flexible and cost-effective method for acquiring IBM software.

  • Variety of Licensing Options: Includes full-capacity, sub-capacity, and virtualization capacity (Sub-Capacity) licensing.
  • Software Subscription and Support (S&S): Each software license comes with S&S, granting access to product upgrades and technical support, ensuring businesses have the latest software versions and assistance when required.
  • Volume-Based Discounts: The program offers escalating discounts based on the volume of software licenses purchased, leading to considerable cost savings for businesses with extensive software needs.

IBM Passport Advantage streamlines the process of purchasing and managing IBM software licenses, making it simpler for businesses to stay compliant, up-to-date, and supported in their use of IBM software products.

How Businesses Can Leverage the Passport Advantage Program

How Businesses Can Leverage the Passport Advantage Program

Businesses can leverage the Passport Advantage program in several ways:

  • Cost Savings: By taking advantage of volume-based discounts, businesses can save money on their software purchases.
  • Simplified License Management: Businesses can manage their software assets more easily with a single agreement for all IBM software licenses.
  • Access to Latest Software: With the S&S service, businesses can always have access to the latest versions of IBM software.
  • Technical Support: The S&S service also provides access to IBM’s technical support, helping businesses resolve any issues they may encounter with their software.

License Verification and Compliance Risk in IBM Passport Advantage

License Verification and Compliance Risk in IBM Passport Advantage

License verification and compliance risk are crucial aspects of software asset management that require careful consideration, especially when utilizing IBM software under the Passport Advantage program.

From the perspective of end customers, these factors play a pivotal role in ensuring optimal software usage and avoiding legal and financial repercussions.

The Importance of License Verification in IBM Passport Advantage

License verification is critical in ensuring a business’s software usage aligns with its license agreements.

  • Ensuring Compliance: Verifying licenses is vital for complying with the terms of IBM software agreements. Non-compliance can lead to legal issues and significant financial penalties.
  • Optimizing Cost Management: Regular license verification helps identify the overuse or underuse of software assets, allowing businesses to adjust their usage to optimize costs.
  • Mitigating Risk: Effective license verification aids in risk management by preventing the pitfalls of software audits, non-compliance penalties, and potential reputational damage.

Understanding the Compliance Risks with IBM Software Licensing

Compliance risks in IBM software licensing can have legal and financial implications for businesses.

  • Overuse of Software: Using more of an IBM software product than the licensed amount can result in non-compliance and potential penalties.
  • Underuse of Software: Holding more licenses than necessary can lead to inefficiencies and unneeded expenditures.
  • Violating License Terms: Each IBM software product has specific terms, which can result in non-compliance.
  • S&S Renewal Lapses: Failing to renew Software Subscription and Support (S&S) included in Passport Advantage might mean losing access to crucial updates and support, leading to compliance issues.

Navigating IBM’s Passport Advantage Changes

Navigating IBM’s Passport Advantage Changes

IBM, a leading player in the technology industry, announced significant modifications to its Passport Advantage Agreement (IPAA) on February 1, 2023.

These changes, which will affect all new customers, are set to extend to existing customers on May 1, 2023.

As an IBM analyst, I’ve dissected these changes to provide a comprehensive understanding of what they mean for businesses and how they can adapt to these new terms.

Critical Changes in IBM’s Passport Advantage Agreement

IBM’s Passport Advantage Agreement has recently seen significant changes that have critical implications for businesses using IBM software.

Increased Reporting Obligations

  • Detailed Reporting Requirement: Firms must report all deployed IBM programs within 30 days upon request.
  • Extended Rights for Data Requests: IBM’s rights to request user data have been expanded from IBM Program License Agreements (IPLAs) to IPAAs.
  • Yearly Compliance and Auditor Confidentiality: Businesses must maintain annual compliance for all IBM products. IBM is also challenging confidentiality agreements with independent auditors.

Incentives for Cloud Migration

  • Changes in Discounts: Discounts for some traditionally on-premises deployed products have been removed up to 24% but remain unchanged for hybrid and multi-cloud platforms.
  • Price Harmonization: An 8% increase in price harmonization worldwide and up to 15% in selected countries.

Simplified Documentation

  • Integration of License/Use Forms: Previously separate attachments for license/use forms are now integrated into the current Passport Advantage contract. This change affects Subscription Licenses, Container Licensing, Government Options, and Academic Volume Options.

Renewal Requirements

  • Verification for Fewer Uses: Businesses looking to renew their Software Subscription and Support (S&S) for fewer uses must verify current uses and installations.
  • Renewal Deadline: Failure to submit verification 30 days before the renewal date mandates renewal of all expiring quantities.

Mandatory Use of IBM-Approved Tools for Reporting

  • IBM Tools for Compliance Reporting: Businesses are required to use IBM tools or manual processes to create compliance reports. Manual reporting of container licenses is no longer accepted.
  • Record Keeping: The IBM License Service (ILS) must be used for quarterly reports, and records should be maintained for at least two years.

Redress Recommendations

ibm passport advantage changes

To navigate these changes, businesses should take proactive steps:

  • Strengthen Software Asset Management (SAM): Establish robust SAM processes for better visibility into IBM license usage.
  • Negotiate Better Terms: Aim to negotiate favorable terms in an ELA or ESSO to protect against non-compliance penalties.
  • Stay Informed: Regularly check the IBM Terms web page for updates, as IBM will no longer provide email notifications.
  • Monitor Compliance: Keep a close eye on compliance, especially with IBM’s sub-capacity requirements.
  • Partner with IBM Licensing Expert: Work with experts to maintain compliance and navigate complexities.


The recent changes in IBM’s Passport Advantage Agreement introduce both business challenges and opportunities.

By understanding these changes and implementing proactive strategies, businesses can effectively manage compliance risks, optimize their IBM licensing, and reduce unnecessary costs in the evolving technology landscape.

FAQs on IBM Passport Advantage

What is IBM Passport Advantage?

IBM Passport Advantage is a comprehensive licensing program that offers a flexible and cost-effective way to acquire IBM software, Subscription and Support (S&S), IBM Appliances, IBM Appliance Services, and IBM Cloud services.

What are the key features of IBM Passport Advantage?

IBM Passport Advantage offers a wide range of features, including volume-based discounting, single agreement coverage, flexible acquisition options, varied payment options, and online access to manage your account.

What are the recent changes in IBM Passport Advantage?

IBM has made significant changes to its Passport Advantage Agreement, including increased reporting obligations, incentives for cloud migration, simplified documentation, new renewal requirements, and mandatory use of IBM-approved tools for reporting.

What is the importance of license verification in IBM Passport Advantage?

License verification ensures that a business complies with the terms of its software license agreements. It helps in cost management, risk management, and avoiding legal issues and financial penalties.

What are the compliance risks associated with IBM software licensing?

Compliance risks can arise from overuse of software, underuse of software, non-compliance with license terms, and failure to renew Software Subscription and Support (S&S)

What is the audit process in IBM Passport Advantage?

The audit process involves notification, data collection, analysis, and audit reports. IBM or an authorized third party conducts the audit to verify that a business’s use of IBM software complies with the terms of its software license agreements.

How can businesses successfully navigate IBM software audits?

Businesses can navigate IBM software audits by being prepared, understanding their licenses, and using tools like the IBM License Metric Tool (ILMT).

What does migrating to the cloud offer in terms of cost benefits?

Transitioning to IBM’s cloud or hybrid offerings can help businesses save money. IBM has removed entitled discounts for some products traditionally deployed on-premises but has kept discounts for on-premises hybrid and multi-cloud platforms.

What tools are approved by IBM for reporting?

IBM now expects all customers to create reports supporting their compliance positions using IBM tools or manual processes. Manually reporting your container licenses is no longer permitted. Businesses must use an IBM License Service (ILS) to run quarterly reports and maintain these records for at least two years.

Need help with IBM Passport Advantage?

Navigating IBM Passport Advantage can be complex.

If you need expert guidance to ensure compliance and optimize your software investment, don’t hesitate to contact Redress Compliance.

Our team of IBM licensing specialists is ready to assist you.

Contact us today for a consultation!


  • Fredrik Filipsson

    Fredrik Filipsson brings two decades of Oracle license management experience, including a nine-year tenure at Oracle and 11 years in Oracle license consulting. His expertise extends across leading IT corporations like IBM, enriching his profile with a broad spectrum of software and cloud projects. Filipsson's proficiency encompasses IBM, SAP, Microsoft, and Salesforce platforms, alongside significant involvement in Microsoft Copilot and AI initiatives, enhancing organizational efficiency.