How to Avoid a Bad Oracle Relationship with a Third Party Mediator

Saturday, 27 January, 2024

In the intricate world of Oracle licensing and audits, businesses often find themselves in a tumultuous relationship that has them caught in a bad romance. Oracle, with its indispensable software and services, sometimes plays the role of a demanding partner, expecting unwavering loyalty and compliance. The complexity and ever-changing nature of Oracle’s licensing terms can feel like moving goalposts, leaving companies striving for compliance but often falling short. This dynamic sets the stage for audits that can strain the relationship further, making it feel as though Oracle is exploiting its indispensable position for additional gains.

Many fear that involving a third-party mediator in such situations might exacerbate tensions rather than alleviate them. However, this apprehension often stems from misconceptions about the role and impact of mediators in the audit process. In reality, skilled mediators can serve as invaluable allies, offering insights and solutions that not only resolve immediate issues but also fortify the relationship between vendor and customer, ensuring a smoother journey ahead. While navigating this complex relationship, companies often adopt a strategy of cooperation, hoping for leniency in their audits.

Playing Nice

Maintaining a cordial relationship with your auditors is undoubtedly beneficial, but it’s crucial to understand that amiability alone won’t shield your company from audit fees. Oracle has garnered a reputation for its rigorous and often contentious software licensing audits, a sentiment echoed across various platforms and discussions. It’s akin to believing that if you play nice, the Oracle audit team might just look the other way. Spoiler alert: they won’t. Oracle’s rigorous audit practices are well-known, and playing nice doesn’t necessarily put you in a safe zone. However, the underlying complexity of Oracle’s licensing terms often renders simple goodwill insufficient for avoiding compliance issues.

It’s Complicated (on Purpose)

Oracle’s licensing structure is notoriously complex, a characteristic that some argue is by design rather than by accident. The ever-changing landscape of Oracle’s licensing terms adds another layer of difficulty, making it challenging for businesses to stay on top of their compliance status. The specifics of Oracle licensing can vary significantly based on the product and deployment scenario, further complicating understanding and compliance.

Oracle’s strategic use of complexity in its licensing agreements offers them distinct advantages. The “fine print” can often surprise businesses, resulting in audits where compliance and fees are strictly enforced. Moreover, the intricacies of preinstalled features can easily lead to non-compliance, highlighting the importance of cautious and diligent licensing management. Such intricacies not only confound businesses but also create a sense of isolation as they navigate the convoluted landscape of Oracle’s licensing terms.

The Isolation Trap

In the intricate dance of Oracle licensing and audits, companies often find themselves in what can be termed the “Isolation Trap.” This predicament arises when businesses, fearing the repercussions of an audit, attempt to navigate the complexities of Oracle’s licensing agreements alone. The isolation trap is a dangerous place to be, not because of the inherent challenges of understanding Oracle’s licensing structure but because it limits the perspectives and solutions available to the company. The fear of exacerbating tensions with Oracle may deter companies from seeking external help, but this is a misconception that can lead to dire consequences.

Related: Why Organizations Hesitate to Hire a Third-Party Expert for an Oracle Audit

The reality is that third-party mediators, like LicenseFortress, bring a wealth of knowledge and experience to the table, transforming potential conflicts into opportunities for clarification and agreement. Their involvement doesn’t just offer a chance to resolve immediate audit concerns; it also provides a pathway to strengthen the relationship between Oracle and its clients. By bridging the communication gap and presenting well-informed arguments, mediators can turn what might have been a financial and relational disaster into a constructive dialogue, leading to outcomes like the annulment of substantial compliance fees. While companies may feel alone in their compliance struggles, it’s crucial to recognize that the challenges often stem from Oracle’s side of the relationship.

It’s Not You, It’s Them

In the realm of Oracle licensing and audits, the blame often falls on the customer for non-compliance or misunderstanding of the complex licensing terms. However, the intricacies and constant evolution of Oracle’s licensing agreements contribute significantly to these challenges. Moreover, the issues at hand are not solely due to the customer’s oversight but are significantly influenced by Oracle’s opaque and convoluted licensing practices.

Our case study where a health insurer tried to navigate their audit independently, underscores the value of expert third-party intervention in these situations. Hostility arose from Oracle’s aggressive audit strategy, which left the organization in a difficult position. Initially, the organization attempted to handle the Oracle audit independently, acknowledging some compliance issues and aiming to settle them reasonably. However, Oracle’s approach—auditing, then demanding exorbitant fees, followed by bargaining for a still substantial amount while pushing for upgrades or extended contracts—escalated the situation. The insurer faced a staggering claim of $400-500 million in unpaid license fees, which Oracle later reduced to $10 million as a “bargain” settlement, including a contentious VMware exception clause. LicenseFortress’s intervention revealed the insurer actually owed $700,000 in back-license fees, significantly less than Oracle’s claims. Read the full case study.


The narrative that unfolds in the realm of Oracle licensing and audits is one of complexity, challenges, and the need for clear communication and expert guidance. Like any relationship, it requires effort, understanding, and sometimes, external help to navigate through tough times. The key to a healthier dynamic lies in recognizing the complexities, seeking expertise when needed, and striving for transparency and fairness in all dealings. In doing so, companies can turn a potentially fraught relationship into a more stable and mutually beneficial partnership.