Recently, Oracle started pressuring customers with 8% technical support cost increases. Oracle claims this increase is driven by inflation. Believe it or not, Oracle’s 8% price spike wasn’t the end of the bad news for Oracle support customers. Oracle made another change to their technical support policies that will impact you negatively for years to come.
In the excerpts below, you see Oracle’s old support repricing policies and Oracle’s new support repricing policies. We’ve highlighted the relevant sections for reference.
| Oracle’s old repricing policy | Oracle’s new repricing policy |
|---|---|
| In the event that a subset of licenses on a single order is terminated or if the level of support is reduced, support for the remaining licenses on that license order will be priced at Oracle’s list price for support in effect at the time of termination or reduction minus the applicable standard discount. Such support price will not exceed the previous support fees paid for both the remaining licenses and the licenses being terminated or unsupported, and will not be reduced below the previous support fees paid for the licenses continuing to be supported | In the event that a subset of licenses on a single order is terminated or if the level of support is reduced, support for the remaining licenses on that license order will be priced at Oracle’s list price for support in effect at the time of termination or reduction minus the applicable standard discount. Such support price will not exceed the previous support fees paid, plus any applicable country annual adjustments, for both the remaining licenses and the licenses being terminated or unsupported, and will not be reduced below the previous support fees paid for the licenses continuing to be supported. |
What does this Oracle support change mean for you?
Let’s go through an example of what this language changes and how you can end up paying more money to Oracle when you use less software. The chart below shows an example of a customer with 100 licenses and who pays $1,000,000 a year for support.
Under the old language, a customer could drop down to 70 licenses and Oracle could only reprice it back up to $1,000,000. A horrible deal for sure, but a decrease in licenses at least avoided the inflation increase. However, under the new policies, Oracle can not only reprice your support back to what you were paying for last year, they can now also add on an inflationary cost increase. In the example below a customer using less Oracle software and spending $1,000,000 a year with support will now spend $80,000 more per year even though they are using less Oracle software.
| Item | Old support policies | New support policies |
|---|---|---|
| Original license quantity | 100 | 100 |
| Original support fee | $1,000,000 | $1,000,000 |
| New license quantity | 70 | 70 |
| New support fee | $1,000,000 | $1,080,000 |
While it might not seem like much, at least under the old policies even Oracle acknowledged it wasn’t going to raise your rates when you used less of their stuff. Those pricing and customer service norms are gone now with this new Oracle policy. Oracle just doesn’t care if you use less of their products, they are going to try to force you to pay more.
So much for the kinder and gentler Oracle I keep hearing Oracle executives talk about!
If you think you are paying too much for Oracle support and you want to learn all your options to get that cost down, reach out to Palisade Compliance today and we’ll help you reduce your Oracle technical support costs and take back control from Oracle.
