Intro – the good, the bad, and the ugly
The ULA (Unlimited License Agreement) is still Oracle’s preferred way to license their software. Many clients look into Oracle’s ULA to see if it’s the best fit for their company. The ULA is:
- limited in term, typically 3 years
- limited in products to what is negotiated
- limited in use to specific entities in many cases.
As you can see, there are limitations to the “unlimited” part of the ULA. One thing that is unlimited is the license annuity for Oracle. Simply put, it’s the gift that keeps on giving – to Oracle. The ULA has good, bad and ugly attributes:
- Good – provides the client with the ability to deploy a set of products on an unlimited number of processors for a period of time.
- Bad – if not properly managed, ULAs can create compliance issues at the end of the term.
- Ugly – often used by Oracle as a way to “close out” and audit.
At the end of your ULA term
One good thing about an Oracle ULA is that there is an end date to the contract, specified in the contract itself. Oracle typically keeps their licensing unclear, but in this case it’s crystal clear that there is an end to the ULA.
The last year of your ULA is probably the most critical time because your actions will determine whether you give Oracle millions of additional dollars, or take a different path that saves you money and helps you achieve your digital transformation goals.
The conclusion of your ULA could result in either a new deal with Oracle, or an exit through certification. The choice is yours. Here’s some information on how to manage the last year of your ULA so you retain control:
The last year of your ULA should be focused on three goals:
- First, you should maximize your ULA deployments. What I mean by that is roll Oracle out everywhere. Expand your licensing footprint so you can claim as many licenses as possible if and when you certify. Remember, your support costs do not go up when you claim more licenses. There is literally no downside here. Don’t squander this opportunity to reduce your unit price Oracle costs.
- Second, ensure there are no non-compliance issues. It’s a mistake to believe you cannot go out of compliance when you have an Oracle ULA. In fact, almost all Oracle ULA customers are out of compliance. So while you are expanding your footprint, make sure you are not expanding your non-compliance. Being out of bounds with your Oracle ULA can force you into an expensive renewal.
- Third, negotiate hard with Oracle on a new ULA. Negotiate price and terms throughout the last year. There is a negotiation methodology to get the best deal with Oracle and part of that process is that you have time to go through the back and forth that Oracle will put you through. Take this last year as an opportunity to get better terms and better pricing.
The best and worst things to do at the end of your Oracle ULA
ULAs are complicated and managing them can be challenging. We could get into a long list of items to do, and avoid. For the current purpose, let’s focus on the single biggest worst and best things you can do at the end of your ULA.
Don’t get trapped!
Simply put, the worst thing you can do at the end of your ULA is not have a way out. If you get to the end of your ULA and you have not planned for your escape from that onerous agreement, then you will be stuck in it and forced to pay Oracle more money that could easily have been avoided. We’re talking millions, sometimes tens of millions of dollars. I’ve seen companies forced into ULA renewals that ultimately cost them over one hundred million dollars.
Plan for certification
Now, the best thing you can do at the end of your ULA is to plan for certification and prepare that certification document. Whether or not you intend to certify, having a certification letter prepared and presented (in part) to Oracle Sales will increase your leverage and empower you to negotiate with Oracle from a position of strength with all the relevant data you need to make a good decision for your business once the ULA expires.
You’re in control
If you’ve done all three steps above, then you only have one thing left to do at the end of your ULA, and that is to make a decision. Following our ULA methodology will leave you with two great options:
- Option 1 is a ULA certification with no risk and plenty of licenses to last for years to come.
- Option 2 is a highly negotiated, low-cost ULA renewal.
More help and content:
Palisade Compliance offers a suite of ULA optimization services from ULA negotiation, through ULA management, and ULA certifications. We’ve helped over 100 clients with their ULAs. If you have an Oracle ULA or you are contemplating one, please reach out to us for assistance.
For a comprehensive review of ULAs and the key steps that you should follow leading up to certification, please download our white paper on finding your way out of an Oracle ULA.