IBM Software Subscription & Support (S&S): Key Contract Terms to Know

IBM Software Subscription & Support (S&S)

Introduction
IBM’s Software Subscription & Support (S&S) is often one of the largest recurring IT costs for enterprises. This annual fee essentially serves as the “maintenance” for IBM software, covering product upgrades, patches, and technical support.

It sounds straightforward, but S&S also locks buyers into yearly cost increases (uplifts) and other restrictive terms if not carefully negotiated.

IBM’s contracts can be complex, and the company has been known to tweak its pricing models (for example, removing certain discounts or imposing large list price hikes) to its advantage. As a result, IT procurement and asset managers must be particularly vigilant with S&S agreements.

This guide explains how IBM S&S works, defines key clauses to watch for, and shares strategies for negotiating fairer terms. Read our overview guide for Mastering IBM Enterprise Agreements: ELA, Passport Advantage, and More.

Written in the voice of an IBM licensing and negotiation expert, it will help you navigate IBM’s standard practices with a strategic and skeptical eye – so you can minimize long-term support costs while ensuring you get the support and upgrades your business needs.

1. What is IBM Subscription & Support (S&S)?

Definition:

IBM Subscription & Support (S&S) is the annual software maintenance fee that IBM charges for its products. For perpetual (owned) licenses, S&S is typically 20–22% of the license’s purchase price per year.

In IBM’s newer subscription or SaaS models, the subscription fee automatically includes support. Still, the concept is the same – a portion of what you pay each year guarantees you support and access to updates. Think of S&S as the price of keeping your IBM software “current” and supported by the vendor.

Covers:

S&S entitles you to all software updates, patches, and new version upgrades released during your coverage period. It also provides access to IBM’s technical support teams for troubleshooting and issue resolution.

In effect, if IBM releases a new major version of the software, active S&S means you can upgrade to it without buying a new license.

You also receive routine fixes and security patches as they become available. Technical support is also included – you can open support tickets with IBM for assistance. (The level of support can range from online knowledge base access to phone support, depending on your agreement and the severity of the issue.)

Risk:

Without negotiation, customers often pay S&S on all licenses – even ones not actively used (“shelfware”). IBM’s default contracts don’t usually allow easy reductions in support counts year-to-year, so unless you negotiate flexibility, you could be stuck paying maintenance for software you aren’t actually using. Over time, S&S on unused licenses becomes pure waste.

Additionally, if you ever let S&S lapse, you lose the rights to new upgrades (you can only run the last version you had when support ended). This makes renewing somewhat of an “all-or-nothing” proposition – a lapse means forfeiting future updates unless you pay hefty penalties to reinstate. In short, S&S is essential but can become a costly trap if you’re not careful.

Checklist:

Use this quick checklist to ensure you understand your IBM S&S coverage and identify any immediate red flags:

☐ Confirm S&S % of license cost – Know what percentage of your original license price you’re paying annually (IBM standard is ~20%). Is yours higher? Lower due to past discounts? This baseline impacts all future costs.
☐ Verify entitlements – Clarify exactly what you’re entitled to with S&S: Are all updates and version upgrades included? Do you have access to IBM’s support portal and phone support? Any limitations? Make sure you’re getting full value.
☐ Identify shelfware paying S&S – Inventory on which licenses you are paying support. Are you actually using all of them? Identify any shelfware (unused licenses) where you might consider dropping support or negotiating a reduction to avoid unnecessary fees.

2. Standard Terms in IBM S&S

IBM’s S&S comes with a set of standard terms and conditions that every customer should be aware of. These default terms usually favor IBM, but knowing them arms you for negotiation.

Key standard elements include:

• Annual Uplift: IBM typically imposes an annual price increase of around 5–7% on S&S fees by default. This means that each year at renewal, your support bill increases, even if you’re using the same software. In some cases, IBM has attempted higher uplifts (up to 10% in aggressive scenarios or to align with list price changes). Unless you negotiate a cap, assume your support cost will rise every year. These uplifts compound over time, turning a $100k support bill into $116k+ after just three years of 5% increases, for example. It’s a significant budget factor over a multi-year period.
• Support Hours & SLAs: Standard IBM software support is typically provided during normal business hours (e.g., 8:00 a.m.–5:00 p.m., Monday through Friday) for most issues. High-severity issues (critical outages) will receive 24/7 attention, even under standard S&S – IBM will have engineers on-call for Severity-1 problems at any hour. However, for lower-severity tickets, support work is conducted during business hours, unless you have an upgraded support package. IBM offers premium support options (for an additional cost) if you require guaranteed 24/7 coverage for all issues or faster response times. Under the basic S&S, expect IBM to have target response times based on severity (for example, a response goal within 1-2 hours for critical issues, within a few business hours for medium-severity issues, and by the next business day for lower-priority issues). Always review the support SLA in your S&S terms to know the promised response times and coverage hours.
• Response Times: IBM’s response time commitments vary by severity of the support ticket. In practice, a Severity 1 (critical system down) issue typically receives the fastest response – you should receive an acknowledgment and engagement within a couple of hours, regardless of when it’s reported (since Severity 1 is 24/7). Severity 2 (high, but not total outage) might have a response target within four business hours. Severity 3 and 4 (medium or low priority) issues often have next-business-day initial response targets. These are general guidelines; your contract or IBM’s support handbook will spell out the exact SLA. The main point is that critical problems are prioritized, while lower-priority questions or “how-tos” may not receive immediate attention unless you have premium support. If your operations require a higher level of service (e.g., 24/7 for all severities or quicker turnaround), you’ll need to negotiate this (often at an additional cost).
• Included Upgrades: A major benefit of paying S&S is that you have the right to all new versions and upgrades of your licensed software released during your coverage period. If IBM releases version 10.0 of a product and you’re currently on version 9.0 with active Software Support (S&S), you can download and upgrade to 10.0 without incurring any new license fees. This includes major releases, minor updates, fix packs – essentially everything. It’s one reason many customers keep S&S: it’s the only legal way to stay up-to-date with IBM software. However, please note that if you allow S&S to lapse, you will immediately lose the right to download new versions released after your lapse date. You’d be stuck on whatever version you last had. This upgrade entitlement resumes only if you reinstate support (or purchase new licenses). So, continuous S&S ensures that you can always move to the latest and greatest IBM offering for your product.

To summarize some typical IBM S&S terms and why they matter, see the table below:

Table – Typical IBM S&S Elements

As the table shows, IBM’s standard stance is to lock in a steady revenue stream from you, with increasing fees and strict rules to ensure continuous payment. Knowing these defaults, a savvy customer will want to negotiate deviations or protections (covered in section 4).

IBM Saas vs IBM PaaS licensing? – IBM PaaS vs SaaS Licensing: Navigating Platform vs. Software Subscription Agreements

3. Critical Clauses to Review

When reviewing an IBM S&S contract (often part of the Passport Advantage agreement or a similar agreement), pay close attention to specific clauses that can have significant financial implications.

Here are the most critical areas to watch:

• Reinstatement of Lapsed Support: This clause outlines the process for reinstating S&S coverage if it expires or is canceled, and you subsequently wish to renew or resume support. IBM’s policy is notoriously strict: if support lapses, IBM typically requires you to pay retroactively for the lapsed period (up to a certain limit, commonly 12–24 months) plus the current renewal to reinstate. In other words, there’s a penalty for letting support lapse – you don’t save money by skipping a year because IBM will make you pay that “missing” year if you come back. For example, if you didn’t pay support last year and now want to receive support again, IBM might bill you for last year’s fee (perhaps even with an increase) and for the upcoming year. If your lapse is beyond the allowed window (e.g., more than a year or two), IBM may refuse reinstatement and instead require you to purchase new licenses to regain support. Always review this clause to understand the cost of any coverage gap. It often effectively locks you into either renewing on time or facing a hefty bill later.
• Late Renewal Penalties / Auto-Renewal: IBM usually sends renewal quotes well in advance of your S&S expiration. It’s crucial to meet renewal deadlines. If you miss the renewal date, two things can happen: (1) Your support lapses (triggering the reinstatement rules above if you want to fix it later), or (2) in some cases, IBM might auto-renew your support to avoid a lapse, but likely at full list price if you haven’t formally accepted a quote. For instance, if you had a special discounted rate but failed to submit the renewal paperwork on time, IBM might still process the renewal, but without the discount, meaning you would pay a higher amount. Alternatively, if your contract has an auto-renewal clause, you may be liable unless you provide notice to cancel by a specific date. The key is: do not ignore renewal notices or dates. Always negotiate and confirm your renewal terms before the deadline to ensure a smooth process. Missing it can either result in penalties or an unwanted renewal at unfavorable rates.
• Upgrade Rights: We have addressed this in standard terms, but it’s worth highlighting. The contract will specify that upgrade and update rights are contingent on active S&S. As a buyer, you should understand that “upgrade rights” isn’t just a marketing term – it’s a legal boundary. After your support end date, you will no longer be able to deploy any software versions released after that date. If IBM audits you and finds that you are using a version released after your S&S lapsed, that constitutes a compliance issue (unlicensed use). So review how the contract defines the scope of versions you can use. If you plan to skip support for a while, be aware you’ll be stuck on older technology. Conversely, if you maintain support, you have the right to all new versions. One strategy some use if they know they’ll lapse: download any available updates before the support ends (since you have the right while active). But legally, you shouldn’t use versions that come out afterward. This clause serves as a reminder of why staying on support (or carefully timing lapses) is important to avoid losing access to improvements.
• Scope of Coverage: Ensure the S&S agreement clearly covers all the environments and usage scenarios you require. For example, if you have multiple environments (development, testing, disaster recovery, production), verify that support covers issues arising in all those environments. Generally, if you have a license for an environment, support also applies to that environment. IBM doesn’t usually restrict support to “production only” or anything, but please double-check. Also, verify the geographic scope: if you operate globally, can you get support from regional IBM support centers as needed? Another aspect is whether third-party or secondary products are covered. IBM software often has prerequisites or components (such as WebSphere and DB2, bundled in a solution) – confirm that support extends to these bundled components as well. Essentially, read the fine print to be sure that when you call IBM with any problem related to the licensed software, they won’t turn you away due to environment or component issues. If something isn’t covered (for instance, a separate license may be required for a DR instance), this should be addressed during negotiations to avoid a support gap.

In summary, the above clauses determine the level of flexibility or inflexibility in your support situation. Always review them in IBM’s Terms and Conditions document or your renewal quotes. If any of these clauses seem especially risky or costly, flag them for negotiation.

IBM often uses standard boilerplate language; however, larger customers have successfully amended terms (e.g., waiving reinstatement fees in certain cases or allowing partial renewals without penalty). You won’t get what you don’t ask for.

4. Negotiation Points for S&S

Negotiating with IBM can be challenging – they are a large vendor with set policies – but as a customer, you do have leverage, especially if you’re a significant account or considering moving to competitor products.

Here are key negotiation points and strategies to help rein in S&S costs and improve terms:

• Price Holds: One effective tactic is to negotiate a multi-year price hold or freeze on your S&S fees. Instead of accepting 5-7% increases every year, push IBM to fix the S&S price for 2–3 years at the current rate. For example, if your annual support is $200,000 this year, negotiate that next year and the year after remain $200,000 (no uplift). Vendors often agree to this if you commit to those years upfront or bundle it into a larger deal. Even a shorter hold (say, no increase in Year 2, followed by a modest increase in Year 3) can save a significant amount of money compared to compounding uplifts. Make sure any price hold agreement is documented in the contract or quote (don’t rely on verbal assurances). By locking the rate, you protect your budget from unexpected hikes – at least for the term of the hold. This is especially important given IBM’s history: they occasionally implement broad price increases (in recent years, IBM has raised some software and support prices by double digits in a single instance). A price hold insulates you from those shocks during the agreed period.
• Cap Annual Uplifts: If IBM won’t agree to a full freeze, the next best option is to negotiate a cap on annual increases. For instance, you could cap the uplift at 3% per year or tie it to a Consumer Price Index (CPI) inflation rate. The idea is to limit IBM’s ability to impose 5%, 7%, or higher – instead, you get an upper bound that is more predictable and ideally lower. Many customers aim for a 0–3% range. Some contract language might say “annual S&S price increase shall not exceed 3% or CPI, whichever is lower.” Even if IBM insists on a fixed 5%, try to negotiate a reduction of a couple of points. Every percentage matters when dealing with large sums. A cap like this forces IBM to abide by a known maximum, which prevents nasty surprises. Given that inflation and vendor pricing can fluctuate, having it in writing that your support won’t jump more than X% gives you cost certainty. This can often be achieved if you’re renewing a large volume of support or purchasing new licenses – use that moment to secure better terms on the maintenance in the future. Remember, IBM sales representatives have some discretion, especially when closing quarter-end or year-end deals; they may be able to include an uplift cap to finalize a sale.
• Exchange Rights: A more advanced negotiation point is to request exchange or swap rights for licenses under S&S. This means if you have certain IBM software licenses that you later decide you don’t need or want to replace with a different IBM product, you can “exchange” the licenses’ support value towards another IBM software of equal or greater value. For example, say you’re paying support on an older IBM analytics tool but plan to move to a newer IBM product or a different IBM cloud service – negotiate the ability to transfer your investment. In practice, IBM might allow you to swap unused licenses for other licenses or cloud credits as part of a deal, but only if it’s agreed upon upfront. Having exchange rights in writing protects you from being stuck paying for support on a product that is no longer available. IBM sometimes has formal programs to migrate from one product to another (especially if they are deprecating a product in favor of a new one). Still, as a customer, you can proactively bake this flexibility into your contract. Essentially, you’re saying: “If I’m paying you maintenance, I want the ability to reallocate that to something of equal value in IBM’s catalog if my needs change.” This is not a standard right in IBM agreements, but large enterprises have negotiated it. It’s a great way to future-proof your investment – technology needs evolve, and you don’t want to double-pay for new licenses while old ones sit unused under support.
• Shelfware Mitigation (True-Down): A constant pain point is paying support on shelfware (unused licenses). To combat that, negotiate true-down rights – the ability to reduce the number of licenses under support (and the cost) as your usage declines. For instance, if you currently have 1,000 user licenses on support but expect to only need 800 next year (perhaps due to consolidation or moving some users off the platform), a true-down clause would allow you to drop those 200 from maintenance and pay less. Without this, you’re typically stuck renewing all licenses, even if they’re not all in use. IBM’s standard approach is “use it or not, you own it, you pay support if you want any of them supported.” But in negotiations, you can push for a more flexible approach. This might be structured as a percentage reduction allowed each year (e.g., you can reduce up to 10% of the quantity without penalty) or an overall allowance to terminate support on certain licenses. If IBM balks, consider your leverage – maybe you’re considering third-party support alternatives or shifting spend elsewhere, which can motivate them to cooperate. True-down rights are especially important in multi-year agreements: they ensure you’re not over-paying for capacity you’ve dropped. Even if you can’t get an explicit clause, you can at least plan to manually drop some licenses at renewal (IBM can’t force you to renew everything, though they might make it administratively difficult). Having it agreed makes the process smoother and without any penalty threats.
• Negotiation Leverage Tips: Always remember to leverage what matters most to IBM. They want to sell new licenses, cloud subscriptions, or prevent competitors from entering the market. Use that in your S&S talks. For example, if considering a new IBM project, negotiate the S&S terms as part of that deal (“We’ll buy this new IBM software, but we need a 0% uplift on support for the next 2 years on these and our existing products”). IBM reps have quotas and flexibility at big deals – that’s your chance to get concessions. Also, don’t hesitate to get quotes from third-party support providers (some companies support IBM software independently). Even if you intend to stay with IBM, knowing that alternative costs can be a bargaining chip: “If IBM can’t commit to a reasonable support renewal, we have options to move off your support.” IBM, of course, will warn you against leaving their support (because of upgrade loss, etc.), but showing them you’re willing to consider it can lead to last-minute discounting or concessions.

Checklist: Before finalizing any S&S renewal or new agreement, ensure you’ve addressed the following negotiation points:

☐ Annual uplift capped or CPI-based – Don’t accept open-ended increases. Secure a cap (e.g., ≤3% or tied to inflation) on yearly S&S price hikes.
☐ Multi-year price hold – Whenever possible, lock the support price for 2-3 years. Even a short-term freeze provides budget stability and savings.
☐ Exchange rights included – If relevant, get terms that allow swapping or crediting unused licenses toward other IBM products or services. This adds flexibility for future changes.
☐ True-down protection – Make sure you can reduce quantities (and costs) for support if your usage drops. Negotiate the right to scale down at renewals without penalty.

By checking off these items, you’ll have a much stronger contract that could save significant money and headaches down the road. It turns the S&S from a one-sided arrangement into a more balanced, client-friendly deal.

5. SaaS Support vs. On-Prem S&S

IBM, like many vendors, is moving more of its portfolio to SaaS (Software-as-a-Service) and subscription models.

It’s important to understand how support works in those models versus the traditional on-premises S&S, because the cost and terms may appear different, but many principles remain:

• On-Premises S&S: For traditional perpetual licenses, S&S is a separate line item that you pay annually (or in a multi-year upfront payment). You see it explicitly as “Subscription & Support” on quotes, usually calculated at ~20% of your license fees. You have the choice each year to renew or not (though with consequences as discussed). Agreements like IBM Passport Advantage govern the terms, and you mainly get the right to support and upgrades for software running in your environment. There’s no uptime guarantee from IBM because you run the software on your own infrastructure – IBM’s obligation is to fix issues and provide patches, not to ensure your system remains up (that’s the responsibility of your IT team). Essentially, on-prem S&S is a support contract for you as the owner of a software license.
• IBM SaaS / Subscription Support: In IBM’s SaaS offerings or subscription licenses (such as IBM Cloud Paks or cloud-hosted services), support is typically bundled into the subscription price. You don’t usually see a separate “20%” support fee; instead, you pay a recurring subscription fee that includes the right to use the software and receive support. The primary difference is that with SaaS, the software runs on IBM’s cloud (or is provided as a service), so IBM also commits to a level of service availability. This is where Service Level Agreements (SLAs) come in. IBM SaaS contracts often promise a certain level of uptime (e.g., 99.9% availability) and define remedies, such as service credits, if that uptime isn’t met. They also outline support response times for incidents, similar to on-prem, but sometimes with more stringent timelines since it’s a service. In many ways, SaaS support SLAs can be stronger. For example, IBM might guarantee that a Severity 1 cloud service outage will be worked on 24×7 until resolved and that you’ll get regular updates, etc., and if the service is down too long, you might get financial credits.
• Cost and Uplift in SaaS: Don’t assume that because support is “bundled” in a SaaS fee that you’re safe from increases. SaaS subscriptions also face renewal price increases. IBM might increase the subscription fee upon renewal (just like they would have increased S&S). In fact, IBM has been known to raise subscription and cloud costs annually unless locked in. The difference is you can’t choose to go without support – in a SaaS model, if you don’t pay the renewal, you lose access to the software entirely (since you don’t own a perpetual license). This can reduce your leverage because IBM knows you need to renew to keep using the service. It underscores the importance of negotiating multi-year commitments or price protections for SaaS. For example, if you sign a three-year SaaS agreement, try to negotiate that the rate remains the same for those three years, or any increase is preset (and modest). Otherwise, you might get a nasty surprise at year 2 or 3 with a jump in subscription cost. In essence, the procurement strategy for SaaS is similar: lock in prices and caps for as long as possible, just as you would with S&S.
• SLA vs S&S Differences: On-prem S&S doesn’t include any uptime or performance guarantee – that’s purely under your control. SaaS does include uptime commitments from IBM. This is a plus for customers, but make sure to read the fine print: the SLA may exclude certain types of downtime or have scheduled maintenance windows, etc. Additionally, the remedy is typically in the form of credits, which may not fully compensate for the business impact. On the support responsiveness side, IBM’s support team will often be the same or similar between on-prem and SaaS (you might even be dealing with the same support organization). The difference is that with SaaS, IBM can often directly apply fixes to the environment since it manages it. In contrast, with on-premises support, IBM provides patches or instructions, and your team applies them. From a terms perspective, ensure the SaaS contract clearly states support expectations (response times, how to report issues, etc.) just as you would clarify them in an on-prem support contract.
• Renewal Risk: One risk unique to SaaS is that if you don’t like the support or terms, your alternative is to migrate off the platform entirely, which can be a significant undertaking. With perpetual licenses, if IBM support became too expensive or unsatisfactory, some customers consider third-party support or staying on older versions without support. With SaaS, you don’t have that option – you’re essentially renting the software. So at renewal time for SaaS, IBM may have the upper hand. To mitigate this, negotiate renewal terms upfront. Try to include a clause that allows for renewal at the same price or with a slight increase at most. If IBM won’t commit beyond the initial term, at least you know to anticipate negotiations each cycle, and you can prepare alternatives or plan for a potential migration if they try a big increase.

In summary, while the packaging differs (separate maintenance fee vs. bundled subscription), the core advice remains the same: negotiate your support terms, whether on-premises or SaaS.

On-prem S&S offers a bit more flexibility in dropping coverage (while retaining the software), but may lack the robust SLAs. SaaS offers better SLAs and a single bill for everything, but you’re more locked in and must closely monitor renewal pricing.

A procurement-focused approach will ensure that, regardless of the model you’re in, you’re protected against unwarranted cost escalations and have clarity on support expectations.

How do IBM agreements compare? – IBM Passport Advantage vs Enterprise License Agreement: Which to Choose?

6. FAQs

Finally, let’s address some frequently asked questions about IBM S&S terms and how to handle tricky situations:

Q: What happens if I don’t renew IBM S&S for one year?
A: If you decide to skip or stop paying S&S for a year (or any period), a few things occur. First, as of your support end date, you lose access to IBM’s support services and future updates. You can still legally use the software version you have at that moment (your perpetual license is still valid for the existing version). Still, you won’t receive any new patches or upgrades released after your coverage expired. If an issue arises, you can’t call IBM for help except on a pay-per-support basis (which is usually expensive and limited). Essentially, you’re on your own. Now, if you want to re-activate support a year later, IBM will treat it as a lapsed support reinstatement. They will likely charge you for the “missing” year of support (and possibly a penalty). For example, if you skipped a year that would have cost $50,000 in support fees, IBM might require that $50k (sometimes capped at up to 2 years of fees) to be paid when you return, plus the new support term going forward. In some cases, customers find that after not renewing, IBM’s quote to reinstate is so high that it’s nearly the cost of buying fresh licenses. So, dropping S&S can save money in the short term, but there’s a risk: you’re stuck on an old version, and it’s costly to get updates later. Organizations sometimes do it if they’re in a stable environment and don’t plan to upgrade for a while, but it should be a conscious decision with full awareness of the trade-offs.

Q: Can I drop support on some licenses and keep others?
A: Yes, you generally can choose to renew S&S on a subset of your licenses and let other licenses lapse – with some caveats. IBM’s agreements usually operate at the individual entitlements level. For example, if you own 100 licenses of a software, you could decide to renew support on only 50 of them. The remaining 50 would become unsupported (you still own them, but you won’t receive updates or support for those). However, IBM may require that you specify which licenses (by serial number or entitlement) are still under support and which are not. In practice, during renewal, you would inform IBM or your reseller of the line items or quantities you are renewing and those you are dropping. There’s no direct financial penalty for dropping some licenses – you simply stop paying for those. However, be cautious: if you later use one of those dropped licenses and require support or an upgrade for it, you’ll face reinstatement fees (as that particular license is no longer under support). Additionally, IBM sales representatives may informally push back – they might urge you to keep all licenses on support, or they may suggest that your discount level could change if your volumes decrease. It’s essential to verify if your pricing is based on a specific volume band; dropping a large chunk might reduce your discount, making the per-license support cost higher for the ones you retain. Therefore, the strategy is to analyze usage and drop only truly unused licenses, and then confirm with IBM how this will impact your pricing for the remainder. It’s a smart way to eliminate shelfware maintenance costs, and IBM does allow it, though they won’t advertise that you can do this. Always document which licenses you chose not to renew in case of any disputes later.

Q: Does IBM allow reinstatement after a lapse — and at what cost?
A: IBM does allow you to reinstate S&S after a lapse, but it will come at a steep cost. The standard practice is that you’ll have to pay for the entire period during which you were unsupported (up to a limit, often 2 years). For instance, if your support expired 18 months ago and you now want to reinstate it, IBM will ask for 18 months’ worth of support fees (as if you had never left) plus the fee for the upcoming renewal term. In many cases, they also include any annual increases that would have occurred in that time. Sometimes, an additional 10-20% reinstatement surcharge is applied, although IBM may waive the formal surcharge and instead apply back fees. The result is usually that reinstating can cost nearly as much as maintaining support the whole time – hence there’s little financial benefit in a short lapse. If the lapse has been very long (say, over 2 years), IBM might say the product is now treated as a new license sale (especially if versions have moved on significantly). One strategy, if you know you might want to come back later, is to negotiate something at the time of dropping off – but honestly, IBM rarely budges on the principle of back fees. They enforce this to discourage customers from “turning off” support to save money and then turning it on only when needed. There have been cases where a customer left IBM support and later, during a big new purchase negotiation, got IBM to waive some back fees as part of a deal, but that’s the exception, not the rule. Count on paying retroactively if you lapse. Always run the math: if you’re dropping support purely to save money in the short term, ensure that if you need to upgrade later, you’re okay with either the hefty reinstatement bill or potentially buying new licenses as an alternative.

Q: How much uplift is “standard” for IBM S&S?
A: “Standard” in the IBM S&S context usually refers to the typical yearly price increase applied to support renewals. Historically, IBM has typically set an annual growth rate of around 5% as a baseline. In recent years, ranges of 5–7% have been common for many products. IBM representatives might tell you, “Our standard annual increase is 7%” (or some figure in that range) when discussing renewals. That being said, IBM has also made larger one-time adjustments; for instance, IBM has at times increased support prices by 10% or more in a year, especially when aligning them with the list price or adjusting for inflation/currency changes. Essentially, 5% can be seen as a common minimum standard, but it’s not a hard rule. The key thing to know is that IBM will almost always propose some uplift unless you have a special agreement. They rarely keep pricing flat by default. From a buyer’s perspective, you should view any “standard” uplift as a starting point for negotiation, not something you must accept. Many customers successfully negotiate lower uplifts or even zero increase for a period. Vendors sometimes call an increase “standard” to normalize it, but in contracts, you have the power to question it. Also, remember that if you got a very steep discount on the initial license or prior support, IBM might try to “normalize” it by higher uplifts to catch up to a target support level. Always ask: “What is driving this increase?” and “What can we do to mitigate it?” In summary, while 5-7% might be standard, your goal should be to break from that standard through negotiated caps or freezes (because over a decade, even 5% each year means paying about 63% more than you are now for the same support).

Q: Are SaaS support SLAs stronger than on-prem S&S terms?
A: They are different, and in some ways stronger, yes. With SaaS, IBM typically includes an uptime guarantee (for example, a guarantee that the service will be available 99.9% of the time) – something you don’t get with on-prem software since you run it yourself. This means the SaaS SLA covers areas such as availability and performance, and often provides remedies, including service credits, if IBM fails to meet those targets. That’s a form of “strength” because it gives you a contractual assurance of reliability. In contrast, on-prem S&S doesn’t guarantee your system won’t go down – it only guarantees IBM will help you if something goes wrong. Regarding support responsiveness, IBM’s commitments in a SaaS SLA are often similar to traditional support for issues (e.g., they’ll still classify issues by severity and respond accordingly). In some IBM SaaS offerings, you might even find guaranteed response times spelled out more explicitly. Both on-prem and SaaS support will prioritize critical issues. Still, SaaS might have the edge in that IBM is actively monitoring its service and can sometimes fix issues before you even notice. One could say that SaaS support is proactive (they ensure the service is up and updated), whereas on-premises support is reactive (they respond when a problem is reported). That said, it’s not universally true that SaaS support is “better” – it depends on the vendor and the offering. For IBM, major SaaS products will have a published SLA you can review. It’s also important to note what the SLA does not cover, such as issues caused by your network connection or user errors. As a buyer, you should compare the SLA to your requirements. If you require higher uptime or faster response times than the standard, you may need to negotiate an addendum or a premium support package, even for SaaS. In summary, IBM’s SaaS SLAs add an extra layer of assurance (uptime, cloud-specific metrics) on top of the normal support terms – that is indeed stronger in scope than on-prem S&S terms – but you should still ensure the provided SLA aligns with your business needs and hold IBM accountable to those promises.

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