The Right Way and Wrong Way to Move to Oracle’s Cloud

First, let’s talk about the wrong way to move to Oracle’s cloud. This is a real example of an Oracle customer in distress. Unfortunately, they made so many bad moves we were not able to get them to where they wanted to go.

In this case, the customer was a major California university. They previously moved their on-premise environment to the Oracle cloud. They were unhappy with the Oracle cloud experience, so they wanted to move from OCI to AWS. Of course, their Oracle rep said they couldn’t make that move without going out of compliance. That’s when the university called Palisade Compliance for help.

Bad news about Oracle DB licenses

I asked to see their Oracle contracts and they forwarded me their cloud contracts. I clarified my request and asked to see their Oracle license contracts. That’s when they told me they had “turned in” all their licenses to Oracle and only paid annual cloud fees. What? You did what?! That’s right. The university had no Oracle licenses.

I read through the cloud agreements and there it was. All the licenses were terminated, and I was the one who had to give them the bad news. If they lift and shift to AWS, they would have to rebuy all the Oracle licenses. I did give them other options of porting to a non-Oracle database or renting Oracle Database SE on AWS, to name a couple. However, all these options were cost prohibitive. The university was forced to stay with Oracle cloud.

Unfortunately, the university’s big mistake of “turning in” their Oracle database licenses is Oracle’s ultimate goal. That’s exactly what Oracle is encouraging their customers to do. Turn in your licenses, they will give you some one-time credit, and you can move to the Oracle cloud. Oracle makes it sound great, but there are two HUGE problems with this approach.

2 problems with ‘turning in’ your licenses

First, you never get the credit value in cloud that you give up with your licenses. NEVER. Second, and most important, you lose your leverage over Oracle and ultimately your freedom. This university wanted to leave Oracle cloud but could not. They were trapped. There is nothing Oracle likes more than a customer that is helplessly locked into Oracle.

What should they have done instead?

What the university should have done was retain their Oracle database licenses and acquire additional Oracle cloud credits to use OCI. If they had retained their Oracle licenses, they would have been able to lift and shift to AWS without any problems.

Never ever give up your Oracle licenses for Oracle cloud credits. The short-term savings on your balance sheet will never make up for your loss of leverage, freedom, and future Oracle costs that will become unavoidable.

Craig Guarente
Craig Guarente
Craig is the CEO of Palisade Compliance, which he founded in 2011. Before 2011, Craig worked at Oracle for 16 years where he was the Global Vice President of Contracts, Business Practices, and Migrations. He was also the Global Process Owner for Oracle’s audit teams (LMS), a member of Oracle’s CIO advisory board, and on the Oracle User Group’s contract and licensing advisory board. Craig is now the leading expert on Oracle licensing, is quoted in dozens of publications, and assists with many high-profile Oracle disputes.
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