Introduction
A third-party license consultant applied Oracle policy, not customer contractual obligation
With over 1,000 employees, the software company is a global provider of cloud-based administration software. Oracle started an audit of the company’s databases and middleware. First, the company engaged a third-party license consulting firm to get an objective assessment. The third-party firm found that they were out of compliance and owed $57 million in back licenses and fines, following the Oracle Partitioning Policy. This is the same policy that Oracle License Management Services (LMS) would use when determining the proper way to license Oracle software. It is a well-documented fact by Gartner Research that Oracle enforces policy as if it were a contractual obligation. Consequently, many customers are over-licensed and paying way too much for their Oracle software.
The software company then contacted LicenseFortress for a second opinion.
Challenges
The terms of the Partitioning Policy are overwhelmingly lucrative for Oracle
The software company had six VMware clusters. One cluster to support middleware, another to support the Oracle database, and a third cluster for all non-Oracle software. It also had the same cluster configuration to support Disaster Recovery (DR). They kept their Oracle workloads restricted to those six environments in both the production and DR environments.
Naturally, the terms of the Partitioning Policy are overwhelmingly lucrative for Oracle. Following Oracle’s virtualizing licensing policy: They would need to count all the physical ESXi hosts’ physical cores in all the vCenter Server Instances, even if your organization is not running Oracle across the entire VMware environment. Based on this position, The software company’s total core count was 306. The details are depicted in Figure 1.
The third-party firm concluded that the software company was out of compliance and owed $57 million in back licenses and fines. It recommended they settle with Oracle by purchasing an Unlimited License Agreement (ULA) for $8 million. See Figure 2.
Solution
Untangling the Partitioning Policy saves the customer nearly $8M upfront
Before making any payments, the software company’s board directed its executives to engage another consulting firm and contacted LicenseFortress for a second opinion. LicenseFortress analyzed the same scripts that the previous consulting firm had analyzed. And on the contrary, no issue was found with the VMware configuration that the software company had set up. See Figure 3.
Lastly, LicenseFortress found two minor compliance gaps totaling $200k:
- Unlicensed usage of the Tuning Pack
- DR environment was not licensed for WebLogic
Cost Savings
The $8 million mistake
Ultimately, the software company decided to bring in an outside consultant and not rely on an Oracle audit. Unfortunately, the company learned that “all consulting firms are unequal.”
However, they settled their compliance issue for $200,000, avoiding the costly mistake of buying an $8 million ULA and its 22% annual support costs.
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Anonymity Statement
This case study is based on a customer of LicenseFortress. LicenseFortress takes steps to properly safeguard sensitive and personal information by removing all direct identifiers – e.g., name, location, CSI numbers, etc. This step is taken to protect the identity of our customers.
