A procurement team is evaluating Instana licensing costs for an environment containing 300 physical servers, 400 virtual machines, and 2,000 Docker containers distributed across those VMs. How are Instana host unit entitlements correctly calculated for this environment?

Instana uses a host-based licensing model where each monitored physical server or virtual machine counts as one host unit, regardless of the number of processes, JVMs, or containers running on that host. Docker containers on a licensed host are covered within that host unit entitlement, providing significant cost predictability in high-density containerized environments. This per-host model is a key differentiator from per-container or per-transaction licensing models used by some competitors. The correct answer is 'Physical servers and VMs each count as one host unit; Docker containers running on monitored hosts are included within the host unit entitlement at no additional per-container charge'. The incorrect options — 'Each Docker container counts as a separate host unit, resulting in 2,000 host units for containers alone in addition to server and VM counts', 'All monitored entities are counted individually: 300 physical servers + 400 VMs + 2,000 containers = 2,700 total host units required', 'Only physical servers count as host units since VMs and containers are considered subcomponents of the physical server license' — are wrong because they do not align with IBM Instana's architecture or recommended practices for this scenario. Understanding this concept is essential for the Domain 5: Planning domain of the IBM Instana Observability certification.