IBM sells products to HCL – what does this mean for you?
After announcing a deal in December last year, both IBM and Red Hat publicly announced on their websites that HCL has officially acquired various software products from IBM. On June 30, 2019 IBM and HCL completed the transaction. This acquisition helps HCL to further build their software division and fit the growing market areas they want to be in. Security, marketing and commerce are strategic segments for HCL.
In the HCL press release you can find more about HCL’s intentions with this acquisition. At the same time IBM published an overview for their customers to inform them regarding the divesture of IBM products.
What does this mean for you in general?
As part of the deal, HCL takes full ownership of the research and development, sales, marketing, delivery, and support for AppScan, BigFix, Commerce, Connections, Digital Experience (Portal and Content Manager), Notes Domino, and Unica. An exact product list of 169 pages including part numbers and description can be found here. This means that IBM will no longer sell or resell these divested products. Also, IBM partners selling the divested products will require to register with HCL to become an HCL partner/reseller.
From a practical sales engagement point of view, IBM will introduce an HCL sales representative to many of their accounts. In other cases, it can be that other methods of introduction will be used. If you are not contacted and want to engage with such HCL representative, you can reach out to them through HCL@us.ibm.com.
What does this mean for you practically?
First of all, you will receive a letter ‘assigned by notice’ from HCL. With this letter, you are notified that HCL will honour and fulfil the obligations in your IPAA/IPLA contract and will continue to provide support immediately. This means that for any upcoming support renewal for the acquired products you will need to work with HCL instead of IBM. Other IBM products will remain contracted and supported as you were used to before.
There can be situations when IBM will not hand over your contract to HCL. This might be applicable to ELAs, ESSOs US Federal Government and contracts containing specific conditions you have with IBM. In this case, it is wise to contact your IBM representative to check the duration of your contract and how the relationship with HCL will be until the end of your agreement.
Any pending support cases that remained open at IBM were transferred to HCL. Your organisation should have received HCL support credentials on July 2, 2019 for you to track the open support cases.
As per July 16th most new HCL customer should have received a welcome email “Introducing HCL Software” to their new customers. Via this email you can go to the page where HCL has a “Big Welcome to New HCL Customers!”. Here you can register as a new HCL customer and receive your credentials.
Another important part to watch out for is if you received an HCL Proof of Entitlement (PoE). We recommend you verify these entitlements to avoid a wrong license transfer by IBM to HCL. If you did not receive such a letter, contact HCL at HCL@us.ibm.com or their support. We can gladly assist you with such exercise if needed.
What does this mean for your current IBM audit?
If you are under an IBM audit, we recommend you to check the divested products in the list provided above and in your entitlements overview. After understanding what products are now HCL owned, you can determine how this impacts your organisation; meaning to which company you have the responsibility to report the deployment. During the audit, it is recommended to contact the third-party auditor and IBM and discuss having these products out of scope of the investigation. Although each situation might be different, we have seen cases where the auditors with IBM’s consent have agreed to take the HCL products out of the IBM audit scope.
It is recommended to have a clear view of your entitlements and actual deployments in place before discussing this in more detail with IBM or the third party auditor.
Regarding your agreements, your Passport Advantage (PA) business contact with IBM will receive a request for consent to assign your organization’s contract to HCL. That person will be asked to respond within 30 days. Upon you providing your consent the contracts will be assigned to HCL. Again, we recommend verifying these PA records very well before giving your company’s consent. With these verifications you prepare yourself as good as possible to have an out of scope discussion.
In addition, before providing your consent, it is wise to read and review the HCL agreements carefully as they will become applicable to your company as well.
- For information on HCL’s Master License Agreement:
- For information on HCL’s Support Offering:
- Additional Information:
Understanding the deployment for the HCL products within your organization is key when you start talking to your new HCL sales representative. This since there is still a lot of unclarity on the inclusion of IBM products in HCL products.
- WebSphere Commerce (WCS) includes IBM DB2.
- WebSphere Commerce is sold to HCL, however DB2 remains an IBM product.
- How will HCL or IBM deal with determining usage during the audit as DB2 is a supported program of WCS.
Similar principles are applicable to programs like BigFix where ILMT remains at IBM.
In order to help you understand more about this acquisition, IBM provides one helpful page regarding the HCL acquisition. This can be found in IBM’s newsroom.
Next to all the information you can find online, we recommend our customers to have a clear and accurate view of your IBM and HCL entitlements and your current deployment. This will help to determine what the IBM & HCL transaction will actually mean for your organization. Don’t wait until future compliance or contract renewal discussions start. Should you require any assistance, we can surely support you. Don’t hesitate to reach out to us.
This article was published on 18-07-2019
Patrick is co-founder of B-lay. From 1998 he brings a vast experience from his previous roles in Oracle License Management Services (LMS) (active for 6 years) and Adobe License Compliance Services (LCS) (active for 4 years) to create transparency in the licensing market. In addition, he leverages his IBM and SAP knowledge gained throughout the years to help our customers better understand and manage their software licenses. Patrick holds a bachelor’s degree in Business Economics and IT from Hogeschool Utrecht in the Netherlands.