Oracle & Rimini Street: A Look at the Latest Events

Rich is once again joined by the experts from LicenseFortress and Beeman & Muchmore – this time to examine the latest happenings in the ongoing battle between Oracle and 3rd party support provider, Rimini St.

They discuss the details of the case, what has happened recently, and how this may impact customers of Oracle and Rimini St – and what potential it holds for the wider software and IT industry.

Please note that everything said in the podcast is opinion-based on public information.

Welcome to the IAM Review podcast news reviews and resources for ITAM, SAM and software licensing professionals.

Opening Remarks

Rich Gibbons:

Hello everybody. Thank you very much for joining me on this latest IAM Review podcast. Once again, I am joined by a fantastic group of speakers. We have got the always excellent Mike and Dean from Licensed Fortress, and they’re joined by the equally always excellent art and Joel from Beman and much more. So I’m sure you will have heard us all talking on previous podcasts, so you know what you’re in for. Today we are talking about the Oracle versus Remedy court cases and what that means for the IAM industry and professionals within it. Couple of bits of housekeeping, one pronunciation. So we’ve got a mixture of English East Coast, US and West Coast us. So we’ve determined we’re going to try and stick to what seems to be the English pronunciation, which is Rimini, but if you hear a ramini or anything in between, we are all talking about the same thing. And the other piece is everything that we’re talking about today is taken from the public record. It’s all public knowledge. So then no one is a client of any of ours. So everything we’re saying is out in the public domain, any opinions are our own, et cetera. And with that, I will hand over to Mike to kick us off and see how we get on from there.

Oracle vs. Rimini Case

Michael Corey:

Thank you Rich. And I want to thank ITM for having us here today. So one of the most profitable, consistent parts of Oracle’s business is its ongoing support. This is a revenue stream that keeps going on and on in perpetuity. Ru’s entire business model offers companies and alternatives to vendor supply support and Remedy Street is the largest provider globally For over a decade, these two organizations have been battling in court with the original litigation, starting with the copyright infringement case in 2010. And public records show Oracle prevailed winning 90 million in damages, fees and the cost on that action. Oracle is doing everything it can to protect this lucrative revenue stream. During this ongoing court battle, remedy Street, Oracle’s attempted to challenge everything from our rights to use third party support alternatives to the reuse of knowledge being learned from one customer and then being used in another customer. This has Remedy Street on the front lines protecting all our rights as it continues to protect its right to exist. Given the wide ranging effect this court battle could have on every organization globally, we feel it’s frankly important that we discuss it today.

Background of Oracle and Rimini Court Battle

Rich Gibbons:

Wonderful intro from Mike there. Thank you very much. And I think what we’ll do now is just look at some background. It’s a topic that’s been 13 years in the making so far. So for those people who aren’t fully familiar, I think you, Mike covered quite a bit of the background there, but is there anything additional that anyone thinks we should cover just to set the scene for our listeners today in terms of how we got to where we are or indeed, where are we at the moment?

Joel Muchmore:

So Rich, I’m happy to give what I would call the capsule summary of how the two matters have fought against each other for those last 13 years. Again, all of this is out there, but it’s surprisingly hard to find these good capsule summaries because people seem to have given up on the case at sometimes you can find articles from a few years back that try to summarize the whole thing, but it’s too much. The avalanche of rulings information seems almost overwhelming. Ramini won filed in 2010. It was Oracle against Ramini for the way in which they were gathering up patches downloaded from the Oracle store and then used to help their customers. That went on. They had that sledgehammer verdict that came out. There was a permanent injunction that was entered. Ramini said, we’re all better now. And so they filed Ramini two against Oracle to try to get a declaration that what they were now doing was okay.

Oracle cross sued and said, aha, no it’s not. You’re still doing many, many things that you should not be doing. In the meantime, they also filed back in Romani one, they being Oracle against Ramini saying You breached the permanent injunction and you should be in contempt of court. The court agreed and said, you breached the permanent injunction. And my very humble opinion on that one, it was very, very minor breaches, but it shows just how tight the permanent injunction is on Ramini. It was little things like a customer of Ramini forwarded patches to a Ramini technician who then failed to go through the protocol of quarantining. It was little things like that, but nonetheless, there were still a million more dollars at stake and a breach of the permanent injunction. Then in the matter that just happened or the trial happened in around February, it was a bench trial and then the ruling came down at the end of July is the sledgehammer verdict again that we’re all talking about.

And it was the one that said, you’re violating on PeopleSoft. You are in direct violation, you’re violating for database in PeopleSoft environments, and then you are, I get ’em mixed up here, but there was a no infringement for JD Edwards and e-Business Suite. And then on top of that, there were further findings as far as statements Ramini had to make about that they had made before that were untrue. They had to never say other things. So it’s a tight permanent injunction that came along with this that actually compelled speech, which is something that this country loads. We do that as rarely as possible. You have the courts actually force somebody to say something about their product That happened. Obviously Ramini ran to the ninth circuit and appealed it and then filed an emergency motion to say we got to stay this permanent injunction. The court denied it but said, well, as long as you’re at the ninth circuit, we’ll let the ninth circuit decide this.

So the permanent injunction is on hold right now while the ninth Circuit decides it. The ninth Circuit just said, well, Oracle just filed something back at the district court asking for an expansion of the order, basically saying there’s similar things that you treated differently, so revisit your order. Then the ninth Circuit said we can’t decide any of this until it’s final at the district court level. So the permanent injunction is stayed. Ramini does not need to say the things that they were compelled to say until after the permanent injunction is over, and now they we’re back at the district court with a timely filed motion to expand the 197 page order to include some additional products that weren’t originally included. There’s my summary. I bet that was crystal clear.

Explanation of the Ninth Circuit Court

Rich Gibbons:

That was fantastic and it cleared up a question that I had. I’d seen that. Rimini and side note, we’ve already failed at the standard pronunciation, but I think we’ve said both of them. So I think everyone knows what we’re talking about and yet I’d seen that Rimini had to say certain things, dah, dah, dah, but I also couldn’t find them. And that explains why if the injunction is kind of being on hold for our international listeners, what’s the significance of the ninth, the ninth Circuit court? Is that particularly technology related or is that one of the higher levels of court in the us?

Joel Muchmore:

Oh, got it. Of course. Oh, go on art, please.

Arthur Beeman:

Well, and this is an important point, and thank you for raising this rich in the United States on these matters. We don’t have what you see in other countries and in particular western democracies. So-called specialized courts, okay, the ninth Circuit, which is the appellate court for, we’ll just say the West Coast and the US district courts within the states of the United States on the West coast considers all matters of general jurisdiction, including in this instance of course copyrights and in a way both at the trial court level and the appellate court level, that’s what makes intellectual property disputes in the United States such a lottery because there are times at the trial court level, candidly, where you have a judge who really never understood the technology, nevermind the law for a moment, just didn’t quite get the technology, and what happens then? You get bad decisions, you get decisions that really, really aren’t on track with the technology and the law as it should be evolving.

The ninth Circuit is again, it’s an appellate court of general jurisdiction and where they go on this issue, and Mike identified it at the outset and he referred to it as the reuse of knowhow. And once that is in the hot hands of the ninth circuit, what’s going to happen? We don’t know. And that’s highly speculative right now. The ninth Circuit is by reputation, a court that doesn’t hesitate to get creative and remember here that what we are talking about are rights, intellectual property rights, and that’s how Oracle comes to the table. They have duly authorized copyrights. They have been protected by the US Patent trademark office, copyrights been issued, and the best way to look at a copyright, it’s like a patent or anything else, it’s a government sanctioned monopoly. In other words, you’re allowed to exclude your competitors and others from a particular space.

So in most instances, if not all, when you have an intellectual property interest, a patent or in this instance a copyright, you come with a presumption of validity of the intellectual property and then all you really need to do is make the case for infringement. And that’s why this reuse of know-how, and it’s going to be, we’re pretty confident we’ll be in the hands of the ninth circuit. Don’t forget, as appalling as that sounds, the notion of reuse of knowhow somehow or other constituting infringement of a copyright. Don’t forget that there is a doctrine in US law referred to as cross use, and that’s what Oracle’s arguing here. So they’re not really creating this out of whole cloth. It’s not as outrageous necessarily. It could be an outrageous outcome, but the legal arguments that they’re going to be taking to the ninth Circuit are not outrageous per se and very much grounded in established copyright law.

Rich Gibbons:

Oh wow. So first of all, fantastic explanation of the court system there and then the point you make at the end there, it’s not a completely made up attempt to this know-how piece. That’s interesting that there is something behind it. So we’ve mentioned it a couple of times, this reuse of know-how it’s one of those things, it does what it says on the tin in terms of what we’re talking about, but I think for people listening who are maybe thinking, oh, well no, it can’t mean what I think it means when we talk about the reuse of knowhow, what exactly are we referring to there? Is it a specific technology, is it specific things or is it just general knowhow about Oracle software? Have they drawn a line around it or is it up for debate?

Intellectual Property Rights and Reuse of Know-How

Arthur Beeman:

Well, certainly from the standpoint of the litigation, and Joel, obviously your insights here will be important, but certainly from the standpoint of the litigation, what we’re talking about in the instance of reuse of knowhow or as Oracle describes it cross use, it’s the use of one customer’s license to develop updates for other of its customers. And they’re saying that that amounts to cross use and a simple, how should I say, the exterior of that is quite appealing. In other words, there is the doctrine, and you typically, as the defendant in this instance, Rimini or anyone else sued on Oracle’s copyrights, you’re basically in most instances for copyright because the copyright has generally been conferred pursuant to a license, you’re left with really two defenses. One is you have an express license. In other words, what you’re doing you can do pursuant to the license’s terms in this instance with the Oracle licenses because they do so much by their language to limit the scope of the authorized use such that it has to be done on behalf of the particular licensee.

That’s a stretch to say that, well, you’re allowing me to do this pursuant to the terms of the license. The other defense that’s typically raised unfortunately is even tougher. And that’s the so-called copyright misuse, and that’s a doctrine that prohibits copyright holders from leveraging their limited monopoly to allow them control of areas outside their monopoly. So what you would have to show in the instance of reuse of knowhow, and by the way, that doctrine, copyright misuse, it’s used sparingly and rarely successfully. I’m not saying it’s impossible, but it’s tough. And so you’d have to come in here and say, your monopoly, Oracle is limited to this. And by reaching into or attempting to control reuse of knowhow in this market, this support market, third party support market, you are stretching your monopoly beyond what the intellectual property law provides tough case to make. So I think that where we have Oracle, where Oracle finds itself with the ninth circuit new game, they can take all this and it’s viewed as a fresh start with the ninth circuit on these matters, and they’ll get it and it’ll really be, again, to Mike’s original point, that’s going to be when the ninth circuit has a time for everyone in this industry to be holding their breath.

Rich Gibbons:

Right. I see. So we’re talking about this through the lens of Rimini Street third party support, but does the reuse of knowhow extend outside of that? So if person A learns how to manage Oracle software or how to defend an Oracle audit, can they then tell someone else or use that knowledge to support another customer? Does it touch on that side of things as well, Mike?

The Potential Impact on IT Professionals

Michael Corey:

See to me, it’s opening up a can of worms, right? The wrong judge comes along and agrees with this, and now all of a sudden you’re an ITM expert, you’re working at a customer, you’ve come up with a strategy and a way to go determine in something, and you go and take a script you’ve created, you move it over to another customer, you violated reuse of knowledge, right? It’s just how you, it’s just opens up a can of worms of potential problems. And what people have to understand is Oracle’s going to do everything it can to protect this revenue stream. And the reason they’re here is because Reini Street has crossed lines. It shouldn’t. So one of the other things that was up was do you even have a right to use a third party support? The good news is the courts came in and said, you absolutely do have a right to use third party support, but there’s a right way and a wrong way to do it.

So for example, Reini Street, even though you’re entitled to the patch, can’t give it to you, you have to get it before you leave Oracle support or before you leave the other support organization, then you’ll have a legitimate right to use that patch. But if you forgot to download it, guess what? You can no longer go get it. It would be illegal. And so there’s a lot of things going on here, and it’s really frankly very dangerous and you have to pay attention because all of a sudden you might find out you’re doing a lot of illegal things until it gets cleaned up.

Rich Gibbons:

So you make a very good point there in terms of how this relates to the IT world, the IT asset management audience, I think someone mentioned it near the start, I think it was you, that this has been going on for a long time and people have become maybe a little bit immune to it and doesn’t really affect me. It’s kind of legal wrangling about very specific things. But as we’ve seen so far, this has potential, whether you are an end customer of Oracles, whether you are a third party consultant, et cetera, potentially it might impact you. So this is one of those areas of we all need to pay attention, we need to understand what we’re doing, how this lawsuit might impact us. And I guess with it going to the ninth circuit, are we able to say, and I think I know the answer to this, are we able to say, oh, this will be decided in the next six weeks, six months, six years, or is it depends on how many other cases they’ve got? Depends how much attention they pay, how long they want to delve into it. Is it an open-ended situation?

Joel Muchmore:

I would be surprised if it was decided within a year. Once you start stretching towards a year and a half or two years, then that starts to seem lengthy. But we could get a decision on whether or not the permanent injunction is in place could happen in the next six weeks. It’s my understanding that’s fully briefed and ready to go and that could drop pretty much any time. But there’s still one thing in between now and then. And that’s of course Oracle’s efforts to expand the order from the district court and then the impact of that is going to be massive. On the one hand, remedy has stated that they can go ahead and serve people, soft customers. They’ve said, no problem, we still got it. Then they filed papers that said that if you enforce this permanent injunction, all of our PeopleSoft customers are going to be in a world of hurt right now.

So obviously the truth lies in between those two, but I don’t know exactly where. It certainly isn’t going to be good for existing PeopleSoft customers if a permanent injunction drops. Obviously I have no idea whether or not Remedy is frantically right now trying to replace things inside of certain PeopleSoft environments for their customers. Pure speculation, I imagine they are, but I don’t know. And I want to throw out one more grenade into this, which is the Ramini customers who might have these contraband files on their computers right now, is there liability for these many customers for having copyright infringing materials on their environments? It’s not too hard to speculate a situation where Oracle is already doing an audit of somebody and then they expand their audit a little bit and they say, now let’s search for these named files. Remember the 197 page order listed the names of a lot of files that were contraband, and then they just with their scripts run a review to see if any of those files are there.

And if they are, they say you’re a copyright infringer. I mean you would have defenses, oh, I didn’t know Ramini put them there. But good luck with those because all of a sudden in the scope of an audit, they have yet another hammer they’re hammering you with, which is you have these copyright infringing materials in your system and it’s your environment. You should know better. Now, again, that is speculation, but at the same time, we do know that Oracle likes to fight these proxy wars. We accused them of that during the whole cloud wars rather than attack Google or attack Amazon, they attack their customers and said, oh, you’re infringing because you moved Oracle software into the cloud. And they’re like, whoa. Amazon said we could or I thought we could or whatever. They didn’t really care about that customer in my opinion, as much as they wanted to make Amazon and Google appear unreliable. Could they do that here? I have not seen any signs of it, but I’m holding my breath for the first audit where we get back an audit report that says, we really need to look into these files. You have that. Once again, you are forbidden from having their copyright infringing,

Michael Corey:

But Oracle’s motivation’s very clear. They want to protect this revenue stream and legitimately want to protect the intellectual property that has been stepped on. We got here because Rimini Street frankly did things it shouldn’t do. But in Rimini Street’s defense name one IT company that got to where they are, that didn’t play a little loosey goosey. This is a heritage on Silicon Valley of crossing lines they shouldn’t get to. So they’re big enough they can afford to fight it.

Rich Gibbons:

Completely agree with the overall point. And I think Joel’s point made something clearer to me that this isn’t an abstract, it is if Oracle auditing you and you are a Remini Street customer, this is something that you need to be considering now. And we say it every time we speak for one reason or another, but the IAM team needs to be talking to their in-house legal team or their third party legal support, whoever it may be to say, look, this is our situation. We use this company, we use this other company. There’s an ongoing situation. Let’s talk about where we might need to be careful or what we might need to do to protect ourselves. So I guess that’s the kind of immediate action. Anyone listening to us, if you tick these boxes, go and have that conversation and understand the products that are in use and how it might impact you. And I suppose a slight side note with that, we’re talking here about Oracle and Remedy. There are other third party support providers for Oracle, and then there are people who provide third party support for other publishers, IBM, Microsoft, et cetera. Does this potentially apply to all of them as well?

Arthur Beeman:

Well, by saying potentially, absolutely. It does potentially bear in mind that our intellectual property law structure here in the United States, the contemplates enforcement of the ip, copyright, patent, whatever it may be by the holder of the intellectual property. In other words, it’s to the discretion of the intellectual property holder. So there’s a scenario obviously where if they be an Oracle get a favorable ruling on this cross use issue, reuse of knowhow, however you want to frame it. The way they would deploy that law on their side is strategically they’ll go after certain third party providers and let the others walk for whatever business reasons they may have. And it’s that unpredictability of their enforcement, of their intellectual property, which in its own way adds to the havoc which they can leave on the market when they go out and enforce it as they see fit. Because there’s no requirement. Once you have the intellectual property that you uniformly and fairly enforce it out there in the market, you can crush some people and let others walk. That’s your call. And that unpredictability is what makes it such a wicked weapon,

Rich Gibbons:

Right? Oh, that’s interesting. So if I’m a third party support provider, everything’s fine for me right now. Everything continues to be fine for the next five years, but then one day Oracle can say, actually, now things aren’t fine, and I can’t go, oh, well, but it been, it was fine last year that they can do things differently and at different times depending on how they feel,

Arthur Beeman:

Depending on the state of the law. Absolutely, yes.

Rich Gibbons:

Right. And I see, I suppose as well, if Oracle are successful, that opens up the possibility for other software publishers to go, oh, well, if Oracle can stop people doing that, I don’t see why we can’t. And a similar thing across the third party support market, and it is a growing area, we see that IAM review more people thinking about it, talking about it, looking at their options, especially with all the price increases that we’re seeing from software vendors through 2023, it becomes more of an appealing thing. So Dean, have you seen an increase as well in customer organizations looking at third party support for Oracle and possibly other software vendors?

Dean Bolton (28:15):

I would say yes, rich. I mean, I think in general everybody’s looking for ways to get the job done with less expense, right? It is always about budgets are shrinking and with a lot of the propositions put out there by these third party support vendors, it’s a good way to save money and it can be a very effective way, especially when you’re talking about some legacy environments. But I think your overall point, rich is back to what Mike had said at the outset is that this is a significant revenue stream for Oracle and other vendors. And they are doing things not just with this legal battle, but just in general overall to protect that. For example, as all of these vendors move away from this, I’ll call legacy model of license and support towards the new model of subscriptions, that’s another way to protect it because it takes this off the table in the old version, if you bought a license and then paid support, obviously as we’ve been talking about, you can decide that you don’t need support for that anymore.

Recommendations for IT Asset Managers

You still have that license. With the new model of these subscriptions, a lot of the terms are that when you stop paying, you lose the license as well. And that makes it impossible to take to a third party provider because they’re bundled up in one. And we’ve seen additional requirements coming into play when you’re talking about some cloud environments too, where the vendors might be requiring an active support contract, which would obviously prevent third party support from coming into play. A lot of nuances in there, but it’s all, I think ultimately, as Mike said, comes down to revenue and protecting that revenue stream because it is billions with a B for a lot of these vendors.

Rich Gibbons:

That’s an interesting point, and talking about subscriptions and locking things down, tying people in. As we move to the cloud, whether it’s Oracle’s cloud or someone else’s cloud, moving things to SaaS subscriptions, platforms, a service, et cetera, it is common more and more so for customers these days. So this thing to consider whether when you think, are we going to move to the cloud, do we move from CapEx to opex? And typically OPEX always looks more appealing, the numbers are smaller, it’s spread out, but something which people perhaps aren’t aware of. And certainly in a larger organization, I can well imagine there being a disconnect between the finance people who are making the decision. Do we move out Oracle to an OPEX model? They’re probably not talking to the teams who are supporting, as you said, Dean, legacy Oracle software from the mid 20th century potential, well, perhaps not that old, but certainly decades old, and a decision that’s taken on in one part of the business may increase costs significantly in another part of the business or introduce compliance risk, et cetera.

So I think again, as an action point for people, it’s making sure that all the parts of your business are joined up when you’re talking to these vendors, Oracle and others. And if you are using third party support, make sure everybody who needs to know is aware and aware of what that means in regards to this current lawsuit, but also in general terms of procurement and change is going forward. So I mean on that side with the cloud, have you seen anything around Oracle making it, what’s the word, a stipulation if you’re moving into the Oracle cloud, you have to have Oracle support, whether you’re using BYOL or subscription, or have you seen, is it possible to have third party support and be in a cloud environment?

Dean Bolton:

I think the short answer is yes, but it depends on the particulars of there, because all clouds are not the same. And even within a certain cloud, you have, as you mentioned, different pieces, right? It could be infrastructure as a service, it could be platform as a service, it could be SaaS, software as a service in there. And those particulars are all different in there. I think for the most part, which though a kind of guiding principle is if you’re just using the cloud for infrastructure and the customer controls, the installation controls, the patching controls, the maintenance on it, those are the ones where you can bring your own license and use third party support. It’s the ones where it’s either a mix or fully controlled by the cloud provider where the patching is done by them or partially done by them, where it becomes much more tricky in there to control it. And all of the providers have different standards routed, and even the licenses themselves can be applicable in different scenarios there. So it does become difficult, but there are certainly scenarios where third party support works in the cloud just as well as it does in legacy environments.

Rich Gibbons:

I see the phrase that one can’t help but use when talking about any software. It depends. It unfortunately does have to be the caveat for most things. But kind of back to the legal side of things and the confusion, the uncertainty to art’s point earlier that you don’t uniformly, et cetera, it reminds me of the secondhand software market in Europe. So it is something that we’ve had, I think we’re approaching more than a decade of where you’ve been able to resell software, purchase secondhand software, and there are legal cases, there’s precedent, there are a variety of companies in Europe who specialize in this area, but for a lot of organizations, there’s just an element of uncertainty. I’m not quite sure what I can do, what I can’t do. So if I’m a purchaser, a procurement manager, an IT director, there’s a kind of risk rewards, yes, I might be able to save X amount of money, but what if I’m wrong or what if our particular scenario falls outside of that scope and I’m now, I’ve saved 3 million but actually apply and we get hit with a bill, so I’ll probably to be safe, I’ll just buy regular first party software.

I know that’s okay. And I feel like, and again, this is my opinion, but it feels like a similar situation with the third party support where the confusion and the uncertainty means that many organizations will lean towards the safer and more expensive option of sticking with first party support. Do you feel that that is perhaps part of what they’re trying to go for here?

Arthur Beeman:

Well, go ahead, Dean, please.

Dean Bolton:

I was going to say I think safety is definitely there. This does get very tricky and very few people have had to polish up their resume when they go with the safe route or employ some of the large well-known vendors to give them advice on this. But I would say from our perspective, rich, I think we know a couple of people and a couple firms that would be happy to assist them with all of these nuances and do it on a pretty regular basis.

Arthur Beeman:

If you want to look at a true Orwellian future here, all you have to do is look at the frustration and problems encountered by remedy in attempting to comply with the permanent injunction. And this gets back to the by way of example, the reuse of knowhow, the cross use, however you define it. If the ninth Circuit ultimately renders an opinion where they in essence say there’s a right way and a wrong way, who knows what that’ll be, but let’s just say there’s a right way and the wrong way. I can’t believe how difficult that will be in the IT world to figure out what to do. I mean, after literally years of litigating and knowing the issues inside out, remedy was having a hard time towing the line on not one but two permanent injunctions. If all of a sudden the permanent injunctions become the law of the land, so to speak, by virtue of a ninth circuit decision, and you have IT departments around the country trying to figure out, well, what do we do with this third party support? It seems to me we can do this based on the decision, but not that well talk to your lawyers and hope that you don’t get sued. I mean, that’s a tough future. Even if they acknowledge that as the Ninth Circuit acknowledges that, well, there is such a thing as knowhow, and you cannot across the board copyright know-how in this context. However, there is still this doctrine of cross use and therefore you need to do A, B, and C. That’s going to be a tough market to navigate.

Implications of Ninth Circuit Rulings on IT Practices

Rich Gibbons:

Yeah, I think for customers and for providers and for consultancies and things, and then listening to that, then my instinct was, well, I would just get support from the publisher and not potentially trip up. So it certainly seems like a more important situation than it first looks. I think for many people listening, there are these various Oracle versus Google, and there’s always some kind of case going on, and I think people think, well, it is at a much higher level than my organization. I’ll keep doing what I’m doing and I’ll read about it in the New York Times or something when it is finally done, but from this conversation, and I thought I had a pretty good handle on it, but it turns out not as good as I thought. So it is been very interesting for me to see, oh, actually it applies here and it applies there, and this might cause a problem.

And I think for the people listening to us, everyone will have at least one part of their business where they can see the potential implications of this. And I think it seems to be in two sections. If you are a Remedy customer, then there’s one set of perhaps more immediate problems or changes that might come about. But then for all of us in a wider industry, if you’re using Oracle, then there are implications and potentially further down the line if you’re using any software, there may be implications for this. So yeah, it seems like it has the potential to be a real line in the sand and will be, oh, do you remember the days before when you could do this? So yeah, my advice for our listeners would be understand how this might affect you. Are you using Remedy? Are you using Oracle? Do you have plans to, and go and talk to your stakeholders, procurement and things of course, but higher up as well, the C-F-O-C-I-O, et cetera understands is there a conversation or a plan for next year or three years that might get you caught this? It’s one of those I’ve been saying in various ways, the item risk is business risk. And this is one of those things where if someone looks at it as, oh, it’s third party support, it’s an item thing, I don’t need to concern important stakeholders with it. But I think absolutely this is one of those things that has the potential to impact right throughout a business.

Importance of Reviewing Software Contracts

Michael Corey (42:05):

But take that a step further. Every time you make a purchase from any software vendor review in detail the terms, because it’s not uncommon for them to start changing terms over time and sliding it into the purchase. So really it really does require professionals inside the organization, ITM professionals, they’re worth their weight and gold and outside professionals who are constantly dealing with the vendors and their evolving playbooks. What if Oracle decided up the road? You know what? We want to close this loophole of getting patches so when somebody leaves, they can use those patches that they downloaded. What if they decide to change the terms to say, you can download a patch, but you can only use it in the next 90 days. And they slide that in and try to change your terms moving forward so that you don’t have this as an option. And so my only point is, buyer beware, use professional help review these contracts, review these purchase orders to make sure they’re not changing the rules on you. That works against you.

Rich Gibbons:

Completely agree. And I think we’ve seen it with other vendors where click through agreements. Yep, that’s fine, but it actually claims to fundamentally change an agreement that you made 10 years ago that you think is still in effect. And that’s a whole other podcast on its own, that side of things. But given that we’re approaching time, we’ve covered a lot here, some of it relatively complicated for people that aren’t of a legal disposition. And as we said at the start, it’s all in the public domain. It’s all public knowledge. So if you want to learn more, I think as Joel said, it’s not defined, but if you want to learn more, it is out there. You can do some research yourself. You can of course get in touch with any or all of us to help as well. But I suppose final thoughts from each of you, if you will indulge me for those people listening, what’s the kind of main thing that they should take away from this today in terms of one thing that you should understand or one thing that you should go and do when you get back to the office?

Final Thoughts and Key Takeaways

And I’ll start with you, Mike.

Michael Corey:

Yeah, I think that a business has to, I think outsourcing to a third party alternative is a very viable option depending on your unique circumstances. And with it comes a lot of pros and cons. So for example, 50% cost savings, maybe as high as the 70, 80% cost savings. When you’re factor in, you’re not doing major upgrades, no longer entitled to them is on one side of the scale. And on the other side of the scale is you don’t get any security patches moving forward. And so you have to think about how you’re going to handle everything comes with pros and cons. And so depending on your situation, this might make perfect sense or it might make better sense to stay where you are.

Rich Gibbons:

Right. Great point. Yeah, I think that sometimes people forget that staying where you are is sometimes the better option. So I like that, Joel.

Joel Muchmore:

Well, rather than take the opportunity to be simple and concise, I’m just going to real quick ratchet it up. This is a huge question in America right now. Yeah, I said it a huge question in America, but it is the freedom to do what you want with your stuff. This is happening across all industries. Monsanto says you can’t reuse your seats. Farmers, John Deere says, you can’t look inside of the underhood of your tractors right now. Apple says you can’t jailbreak your phones. I think the EU is doing a better job of pushing back on some of that. We’re getting almost no pushback here in the United States. And this is the exact same example of that. You are tethered to exactly what we say about what your software is and who can servee it. It is not yours, it is still ours, and you are in bondage as long as you are one of our customers.

It is a terrible trend. I do not like it. And what’s interesting is it crosses both ends of the political spectrum, techno liberals as well as the working man, both want the right to do stuff with their stuff, yet somehow are government or our policies or our courts are not helping us with this one. And so I think it’s important to look at this on that broader spectrum and try to be loud about it, seize these rights. It is my opinion that it is your software to do with what you want with it. And we are here to help. Other people are here to help. And I say, stand up, do it. Use your software, know the limitations and be careful. But I do not like anybody in any industry getting bullied, which I think is happening in most industries right now.

Rich Gibbons:

That is a fantastic final point, Joel. And yeah, I think that will resonate with lots of people for sure, and you make a good point that be aware of what you can and can’t do, but make sure you exercise your rights as much as you can. Dean, your final thoughts?

Dean Bolton:

Yeah, I think just to piggyback off of what Joel said there is I hope what we conveyed here is that while the topic at hand was really limited with Oracle and Reini Street, this has much broader implications. And thankfully right now it has not really spilled over into something that could be really impactful for all customers with a bunch of different vendors. But there’s nothing that says that won’t happen in there. And again, it’s about kind of taking a broader picture at it, looking at how this applies to you, not just particularly if you’re an Oracle customer or if you’re a Reini Street customer or considering either of those, but looking at it from a bigger picture in there kind of across the board.

Rich Gibbons:

Perfect. Completely agree with that. And then the final thought, the honor is yours, art.

Arthur Beeman:

Oh, well, thank you and thanks again for hosting. Very much appreciated. Let me just say, I’m going to conclude with a little flag waving here. Okay. American law is, you can view it as notorious or a good thing, but very supportive of intellectual property rights. When Joel and I talk to juries and we’re representing holders of intellectual property rights, we talk about inventors in the same breath here in America, that we talk about cowboys. It’s part of our identity. Oracle comes to this table with the cache of being the holder of the intellectual property. They own it and they can do with it what they want pursuant to a contract. And not only can the contract change, as Mike pointed out, but the law itself can change. And that’s what we’re looking at with the Ninth Circuit. When they get in front of them, this reuse of knowhow issue, the rules of the game will change. It’s not going to be a hundred yards on the football field anymore. It’s going to be 50 yards. And that makes a big, big, big difference. And I think what that means for anyone using software is don’t fall prey to caveat eter. Just get out there and know what you’re dealing with, know the contract and by extension, know the law, and both can change right out from under you. And the rules can change. And the only way you can protect your business is by staying on top of both your contract and the law.

Rich Gibbons:

And that I think is a fantastic point to make, that it’s similar to learning the licensing rules of a product. You can learn everything about Microsoft and then next week that they’ve changed half a dozen things and you’re worse than when you start it. And it’s even more the case here that understanding everything now is brilliant, but you need to make sure that you keep an eye on what does the ninth Circuit say, what appeals are made, what things are and are held, et cetera. And it’s a constant process. And for most of our listeners who are managing large IT asset management estates and they’re doing this, that and the other, it’s not something that they can reasonably keep up to date with themselves. So making sure that you use in-house, legal third parties, et cetera, to inform yourself that you do a review every three months, six months, whatever work you are constantly checking.

I think that is a fantastic point to end on. So as always, thank you to the four of you. Fantastic speakers. As always, thank you to everyone who’s tuned in. I’m sure you found it as useful as I did. If you have any questions, I can’t for a moment, imagine that any of my fellow speakers would be annoyed if you got in touch with them. I think they would welcome it, I’m sure. So feel free to do that. Yeah, have a great rest of your day everyone, and I will see you on the next one. Thank you all very much.

Speaker 7 (52:11):

Thank you. Thanks, rich.