The Oracle Torpedo – AMCs & Renewals.

Oracle Software and Application licensing, it sends a chill down many IT managers and SAM practitioners’ spine. Oracle is famous for withholding information regarding their licensing policies and terms of renewal. While the licensing slice is hotly debated, a subtle but never the less important piece, renewal and AMC of procured licenses is mostly ignored. We came acroess one such scenario on how Oracle forces its customers to go for renewal of its unused and underutilized application or software on their terms.

• Mismatching service level – When acquiring technical support, all licenses in any given license set must be supported under the same technical support service level. You may not support a subset of licenses within a license set; the license set must be reduced by terminating any unsupported licenses. 
• Oracle do not sell new licenses without technical support. If you don’t renew your current licenses and next year new licenses are being procured then again you have to pay for the back support for the present licenses as well, which will result in increasing the cost. If the same licenses are purchased again next year then you will end up paying 122% amount. 
• Support cannot be terminated for some of the licenses as it will trigger the Mismatching service level issue. All licenses in any given license set must be supported under the same technical support service level.
• If the licenses are not renewed by any customer, the Web-based as well as telephonic support stand canceled from Oracle. You will not be able to get all the new versions, patches, bug fixes and telephonic support etc. Also if you would like to renew the support in future, then as a failure of the renewal before due date it will attract the reinstatement policy. As per current Oracle policy, the reinstatement fee is equal to 150% of your support fee in effect at the time support is reinstated, prorated from the date the support is being ordered back to the date that the support lapsed.

 Reinstatement of Oracle Technical Support (If you wish to renew your licenses in future)

• If technical support lapses or was not originally purchased with a program license, a reinstatement fee will be assessed. The reinstatement fee is computed as follows: a) if technical support lapsed, then the reinstatement fee is 150% of the last annual technical support fee you paid for the relevant program; b) if you never acquired technical support for the relevant programs, then the reinstatement fee is 150% of the net technical support fee that would have been charged if support had been ordered originally for the relevant program per Oracle’s Support pricing policies in effect at the time of reinstatement. The reinstatement fee in (a) shall be prorated from the date technical support is ordered back to the date technical support lapsed. The reinstatement fee in (b) shall be prorated back to the original program license order date.

Once executed Oracle software program can be painful to exit, it is therefore extremely important that organisations understands the risks involved and adapts a strategy that will help them to exit such agreement with ease or go for partial renewal. An effective and mature SAM program or consulting services has definitely help if one is going for high dollar Oracle deals.