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Oracle has made the strategic decision to bring on-premises term licensing to an end. This means that, as of September 2021, most of Oracle’s on-premises term licenses will no longer be offered for renewal or new customers.
However, there are a small handful of exceptions.
Certain key Oracle products will still be available on term licensing, but for only for 1 year at a time. These products are as follows:
Oracle Database Programs
Standard Edition 2 (SE2) and Enterprise
Edition (EE).
Oracle Database Enterprise Edition Options
Active Data Guard
Multitenant
Advanced Compression
Advanced Security
Partitioning
OLAP
Database In-Memory
Database Vault
Real Application Clusters (One Node)
Real Application Testing
Oracle WebLogic Suite Options
SOA Suit for Oracle Middleware
Oracle Database Enterprise
Management Packs
Tuning Pack
Diagnostic Pack
Oracle Middleware
WebLogic Suite
WebLogic Server Enterprise and
Standard Edition
Internet Application Server Enterprise Edition Forms and Reports
Oracle Date Integration Programs
Golden Gate
Oracle Extended Programmes
Exadata Storage Server Software
Why is Oracle term licensing ending ?
Oracle’s move to end term licensing for its on-premises products is reportedly linked to a downturn in the sales of term licenses in recent years.
And with this in mind, Oracle is keen to encourage customers to migrate to OCI (Oracle Cloud Infrastructure).
This change will only affect Oracle term licensing.
What does the end of Oracle term licensing mean for you?
Licenses of 2, 3 and 5-year terms will no longer be available for Oracle’s on-premises products.
The end to many of the 1 and 2 year term licenses will come as a blow for some companies who favour them when working on time specific projects that only require short-term use.
There are two ways in which this change from Oracle can affect the end-user:
1) Changes to infrastructure
Where users are upgrading or changing their on-premise hardware provisions to a cloud facility, there may be a time whereby Oracle software is running concurrently across the existing and the new software, but only for a short period.
In the past, this period of time would typically be covered by term licenses. Unfortunately, with the absence of term licenses, users will have no choice but to purchase perpetual licenses, which are ultimately more costly.
Where, in the past, traditional one-year term licences could be purchased for a percentage cost of a perpetual license, purchasing a subsequent single year term license will incur a further 5% cost on top.
2) Temporary Oracle licensing non-compliance solutions
In situations where a company has been found to be non-compliant by Oracle License Management Services (LMS) during an Oracle License Audit – perhaps for using a product that was not under the current license agreement – the situation can typically be settled by purchasing a term license.
This acts as a temporary measure to cover the gap and buys time whilst a company decides whether to cease the use of the product, or to purchase a perpetual license.
However, on-premises term licensing is now being phased out. This means that Oracle users falling foul of historical Oracle license non-compliance (exceeding one year) will be required to purchase either a perpetual license, or an Unlimited License Agreement (ULA).
Be careful before signing a Unlimited License Agreement. Preferably speak to your Oracle licensing partner.
Is my existing Oracle term licensing still valid?
Don’t worry, Oracle has issued a statement to confirm that existing term licensing customers will remain supported through to the end of their term.
At the end of the agreement, users will be required to purchase a perpetual license.
If you’re set on opting for a term license ahead of the deadline, these are the costs:
1-year term – 20% of perpetual license cost
2-year term – 35% of perpetual license cost
3-year term – 50% of perpetual license cost
4-year term – 60% of perpetual license cost
5-year term – 70% of perpetual license cost
Any additional support fees work out at 22% of the net perpetual license fee. This will remain the same for the duration of your term licensing agreement.
But again, once your term license has expired, you will be required to sign up to a perpetual license (unless your product falls within the exceptions listed above).
7 Costly Oracle Licensing Pitfalls
And how to avoid costly license non-compliance fines
Read the full guideNext steps
In order to find a more flexible solution to the changes end of term licenses might bring to your organisation, Xynomix recommends migrating the majority of your on-premise deployments to Oracle Cloud Infrastructure.
This can be done without significant business disruption and need not require a great deal of re-architecture or re-integration. Making the move will allow your operations to run more reliably and deliver a higher performance at a reduced cost when compared to on-premise solutions or alternative cloud services.
By using Oracle Cloud, you will experience benefits that outweigh the use of on-premise software such as:
- Rapid patching
- Straightforward, predictable costs
- Usage monitoring
- Simple scaling, according to need
- Greater control of security and governance
- Enhanced high availability
- Federated identity with your existing programmes and systems
Any additional support fees work out at 22% of the net perpetual license fee. This will remain the same for the duration of your term licensing agreement.
But again, once your term license has expired, you will be required to sign up to a perpetual license (unless your product falls within the exceptions listed above).
Conclusion
Whilst the end to term licenses may leave you feeling uncertain of the best way forward, Xynomix will work with you to navigate any emerging issues.
Our experts can perform an Oracle License Review of your estate’s perpetual licenses and advise you on the most cost-effective way forward.
Xynomix is able to guide you through negotiations on a new agreement with Oracle, offering practical advice to see you safely through your old infrastructure and avoiding the need to purchase additional licenses for a double use period.
Our experienced and Oracle-accredited experts will help you navigate safely to Oracle Cloud Infrastructure, future-proofing the capacity and agility of your infrastructure environments.
Contact Xynomix
Xynomix has unrivalled experience across the full range of Oracle and Microsoft SQL server database environments. As industry-leaders in managed database services and consultancy, we are perfectly positioned to offer independent enterprise-grade support to keep your critical systems up and performing perfectly. Get in touch now on 0345 222 9600 or via [email protected].
