Oracle, Licensing, Software asset management, Unlimited license agreements

1. ULA – A report from the “frontlines”
“By failing to prepare, you are failing to prepare”
by Redress Compliance

2. Introducing Fredrik Filipsson
Principal Licensing Consultant and co-founder
15 yrs+ Oracle Licensing Experience
•40+ ULA renewals and
certification for companies
Sweden, Ireland, UK, Germany,
Switzerland, US, Canada,
Australia, Italy, Spain, France,
Saudi Arabia and NL
•50+ License Audits
•Over 150 different types of
Oracle Licensing & Contract
work around the world.
•Recently completed a US
license audit project and a ULA
in Germany

3. ULA Basics
• Pay Oracle 1-50m $ in License fee, a one license fee. (price is
based on business value, not customer size or oracle estate)
• You choose which products you want to include. Most common is
database products and sometimes mixing with middleware.
• For how long (negotiable) 1-5 years (3Yrs most common)
• You can theoretically deploy 100 000 processors of unlimited
Oracle Software.
• End of ULA – Licenses converted to perpetual based on your
count.
• Support will not increase if you exit Oracle ULA.

4. ULA contract mechanics:
2019
You sign an
Oracle ULA.
You pay a one
time license
fee.
2022
If the agreement
is for 3 years, in
2022. You either
exit or renew.
RENEW
means: new
license fee and new
support.
EXIT
means:
You tell Oracle how much
you have deployed and all
those licenses will be made
into perpetual.
(So ULAs can be
incredibly powerful it
managed correctly)

5. The trade/deal you do with Oracle.
Oracle gives you unlimited usage rights
“The Trade”
You give away the right to terminate support
contracts 1 by 1 (all CSI become 1)
You also give Oracle a very large lump sum of
money (license fee for ULA)

6. Contract 1+2+3+4+5 + = 736k $ NEW ULA support = It
becomes an UNBREAKABLE contract.
Contract 1: - 55k $
Contract 2: 120k $
Contract 3: 244k $
Contract 4: 17k $
Contract: 5: 300k $
Oracle ULAs will make your support contract almost
“unbreakable”

7. Top4 reasons why you might renew your ULA (against your will)
You by mistake deploy Oracle Software not part of ULA
For example you deploy 1000
processors of Oracle Database EE.
During certification/exit process you
give Oracle script output.
Script output shows Oracle you
have accidentally used Advanced
Compression not part of the ULA.
Its 240 processors and each CPU
license is 11 500 $ - combined
value 2,7m $ + 22% support = 3,2m
$
Oracle proposes you renew
your ULA to avoid
purchasing new licenses for
3,2 $ and includes the
product that you had a gap
for.
Often the non ULA renewal
proposal is non-attractive
and companies renew ULA
again.
#1Deploying non ULA
Software

8. You sign a contract in US – ULA.
Territory clause only says
deployments in the United States.
During certification/exit
process Oracle is informed
that you have deployed
software in Brazil.
Top4 reasons why you might renew your ULA (against your will)
#2
Contract Compliance
Why do
customers renew
ULAs when they
don’t want to?
100 processors of Oracle
Database Enterprise Edition – A
list price value of 4,7m $.
Oracle proposes you renew your
ULA to avoid purchasing new
licenses for 4,7m $ and includes
brazil in your ULA.
And you pay for a new Oracle ULA
(license fees higher or same as
before and new and old support.

9. But then you use Oracle
software on legal entities that
are NOT part of the ULA.
Example 100 processors of
DB EE
Top4 reasons why you might renew your ULA (against your will)
EXAMPLE
100 processors of Oracle
Database Enterprise Edition – A
list price value of 4,7m $
Oracle proposes you renew your
ULA to avoid purchasing new
licenses for 4,7m $ and includes
the new entities in the ULA.
And you pay for a new Oracle ULA
(license fees higher or same as
before and new and old support
#3
Contract Compliance
You sign a ULA on
parent/corporate level.

10. Top4 reasons why you might renew your ULA (against your will)
If you deploy Oracle ULA software in Azure or AWS
For example you deploy 100
processors of Oracle DB EE. When
the ULA ends those deployments
cannot be counted towards the exit
numbers. So you are in affect non-
compliant.
During certification/exit process
Oracle is informed that you have
deployed software AWS.
100 processors of Oracle Database
Enterprise Edition – A list price
value of 4,7m $
Oracle proposes you renew
your ULA to avoid
purchasing new licenses for
4,7m $ and includes some
rights to allow cloud
deployments the next time
you exit your ULA.
And you pay for a new Oracle
ULA (license fees higher or
same as before and new and
old support
#4Deploying Oracle Software
in non Oracle Cloud.

11. How 15 companies did in their ULAs

12. Why did they enter an Oracle ULA?
Audit
result, 7
Other reasons, 8
WHY?

13. What was the cost of their ULA?
0
6
4
2
3
<1m euro 1m-3m 3m-6m 6-10m 10m >

14. ULA experience
6
9
Renew at least once First time ULA

15. Why did they renew their first ULA?
4
2
Non compliant Other

16. Our ULA compliance statements
License gaps
0
2
2
5
6
<1m euro
1m - 3m
3m-10m
10m -30m
50m >
Top 4 ULA compliance issues
Deployed non
ULA Products
Combining 1#
with
virtualization
Deployed in
public cloud
Contract
Compliance
21
3 4

17. What decision did they make?
5
10
Renew Exit

18. If you discover license gaps - what can you do?
You can renew the ULA with
new products (without
alerting Oracle)
• Why not alert Oracle? :
Because ULA pricing is not
transparent, its based on a
fictive business value.
• If ULA negotiations are
based on 20m euro non
compliance, ULA Price will
be much higher compared
to a competitive
negotiation ULA.
You can try to
remove license
gaps – then
rerun scripts to
see if it is
removed.
You can put
"compliance
issue" on
physical servers
(less CPUs)
and purchase
licenses.
Often 90-100%
of all license
compliance you
can resolve
without
purchasing a
license.
1
2
3
4

19. Report from the frontlines

20. Current status:
European Retail company – 120 000
employees.
Company had not made decision on their
ULA at the start.
Previously:
3x ULA renewals, each for 3 years. (9YR
ULA)
ULA included Database, options and WLS
ULA Expiring in Dec 2019

21. Their Oracle estate
Using Flexera
to manage
Oracle.
1000
databases, 250
WLS.
10% running in
Azure.
5 DCs, globally,
both physical
and virtual
(VMWare)

22. Date 1 5 12 19 26 3 10 17 24 31 7 14 21 28 5 12 19 26
Week # in project #1 #2 #3 #4 #5 #6 #7 #8 #9 #10 #11 #12 #13 #14 #15 #16 #17 #18
Project Timeline
Oct’ 2019 Nov’ 2019 Dec’ 2019 Jan’ 2020
Contract signature
• Setting up project
• Scheduling kick off call
• Share ULA contract
• Onsite meeting
• ULA Contract
analysis
• ULA Training
• Project Kick off
• Validation of
data collection
Deployment analysis (script
analysis)
Data collection from Client
(script output)
• Project Results
• Onsite meeting
• ULA Compliance
• Non ULA products
• Remediation advise
Creation of
deliverables
ULA Decision

23. Contract Analysis - example
“You shall furnish Orade with a certification signed by a C-level
executive of Your entity verifying the quantity of Processors on which the
Unlimited Deployment Programs are installed and running”
IMPACT It means you shall only sign a document
specifying the numbers. This is the “old clause”
Oracle is nowadays offering a text saying you need to
co-operate with Oracle LMS.
“You may not certify Unlimited Deployment Programs that have been
deployed into the public cloud (for purposes of this order, examples of the
public cloud include, but are not limited to, Amazon EC2, IBM's Blue
Cloud, Sun Cloud, Googles AppEngine and Microsoft Azure) as of the
date on which the Unlimited Deployment Period ends (such certified
quantity, the "Certified Deployment" ).”
IMPACT At the end of the ULA if you have any
deployments in a third party cloud. They will not be
counted towards the certification = automatic non
compliance.

24. Process
Step 1:
• Training all stakeholders
ULA contract mechanics.
• Why 1: Often
misconceptions about the
ULA prevents
maximization by IT/App
owners.
• Why 2: Allow company to
make an more informed
decision about ULA:
Step 2:
• Analysis of the ULA
contract
• Why 1: to identify any
contractual risks in the
ULA.
• Why 2: To understand
the certification process.
• Why 3: An incorrect ULA
such as missing legal
entities or incorrect
territory might make a
ULA exit very difficult.
CONTRACT
ANALYSIS
REVEALED:
90 days
certification
instead of
standard
30 days.
did not say
anything about
co-operating
with Oracle LMS
or running
oracle scripts.
All legal
entities
were
covered.
All geographical
territories
covered
(worldwide)
did not allow cloud (azure) to be
used for exit numbers.

25. Process
Step 3:
• License Compliance
• We use Flexera
inventory as a
baseline where is
Oracle installed.
• We used LMS options
file from Flexera to
perform an analysis of
all db options.
END RESULT:
Flexera
showing
license
requirements
when there
was none.
Flexera not
showing
license
requirement
when there
should have
been.
Flexera is
unable to do
basic version
recognition for
WLS.
We used
Oracle FMW
scripts to
analyse
versions.

26. Oracle Actions:
ORACLE BEHAVIOR
- Very keen to run scripts on clients
environments. (to help count)
- As customer was undecided Oracle
offered “free” advice by SIA.
- ULA Insight workshop was offered
to help company make a decision.
- No threats about audit
Oracle wanted to know about renewal 6 months before ULA expiry.
1. ULA remain as is (same products,
same term, same price)
2. ULA with a few new products
(slightly higher price)
3. Perpetual ULA (50%+ more then as
is ULA)
ORACLE OFFERS:

27. End results
• Signed a 3-year ULA including the
products that caused non
compliance.
• Pricing was the same “as current
ULA”.
• ULA expired in Dec 30th.
• ULA was signed on January 30th.

28. 4 Lessons learned
1) Late in reviewing licensing, By being late in renewing licensing there was no time to take remediation steps before ULA
exited. Customer felt that the risk identified was easiest eliminated by renewing ULA with new products. Most of the non compliance was
due to DBA using something by mistake and was not needed by the business. It can be removed, but it requires time and effort. = cost.
2) No optimization – They had ULA products that were not deployed, some application owners did not know the ULA term and was
expecting HW refresh post ULA. If they would have known earlier about the ULA they could potentially have made HW refresh in ULA.
3) License gap identified– Estimated value: 20m euros, this was resolved renewing the ULA with new products at a value lower
than €2m. But if Oracle would have known about the licensing gap the ULA price would have been €5m+
4) SAM tool – Unreliable data. We used it only for discovery purposes “where is Oracle SW installed” by trying to figure out WHY the
SAM tool was reporting incorrect data is a waste of time. (Its Flexera SW development) You can use the options file (raw output) and
analyze it. Instead of running Oracle LMS scripts where running scripts will take time.

29. Get more ULA knowledge
• 5 secrets about Oracle ULAs that Oracle does not want you to know about–
https://www.linkedin.com/pulse/5-oracle-ula-secrets-what-does-want-you-know-fredrik-filipsson/
• 21-must ask questions about your Oracle ULA license agreement
https://www.linkedin.com/pulse/21-must-ask-questions-oracle-ula-agreement-morten-andersen/
• 6 common mistakes companies make when exiting their Oracle ULA
https://www.linkedin.com/pulse/6-common-mistakes-companies-make-when-exiting-oracle-ulas-filipsson/
• How to avoid a “forced ULA renewal”
https://www.linkedin.com/pulse/how-avoid-forced-oracle-ula-renewal-fredrik-filipsson/
• How to master your Oracle ULA agreement
https://www.linkedin.com/pulse/how-master-your-oracle-unlimited-license-agreement-fredrik-filipsson/
• Oracle Masterclass Negotiations: From On Premise Licensing to Cloud Contracts
(https://www.youtube.com/watch?v=0k8c2vNErMw&feature=youtu.be)
• Oracle License Management Training: How to exit your Oracle ULA
https://www.youtube.com/watch?v=jvCHqDWgvDQ

30. Thank you
CONTACT ME
www.redresscompliance.com
fredrik@redresscompliance.com
+353 168 74903
Oracle License Management – Free Training
31 hours of recorded video training this dealing with Oracle
Software topics: https://app.livestorm.co/redress-compliance
Newsletter - https://mailchi.mp/168cad9b93c8/oracleplaybook
Connect with me on LinkedIn
Fredrik Filipsson

31. 5min break

32. 1. Improve Oracle Capability - > SAM tool
• You can improve your
understanding of your SAM
tool capability.
• Run Oracle LMS scripts and
have an expert tell you what
requires licensing.
• Then compare with the SAM
tool findings.
• Avoid over-purchasing
licensing.
• Perform remediation & Risk
reduction activities
• Improve your tool (it can be
great, but you need to
understand what it can and
cant do)
• Create processes for dealing
with SAM tool weaknesses
WHY:

33. 2. Stop the ”bleeding” – annual license review
• Get control over your Oracle
licensing.
• Only reliable way is to
implement a process where
you use Oracle “LMS” scripts.
• You can implement a solution
where the LMS scripts are run
on an annual basis without
much overhead.
• No fear of Oracle license
audits.
• Can actually be used to
prevent audits.
• Massive savings > no more
license audit fees
• Massive savings > quickly
identify unused software.
WHY:

34. 3. Pay attention Licensing & Versions
• Standard Edition if you update
your database you will suddenly
need SE2 licensing and can fall
into Enterprise Edition licensing.
• In 19c only, you can have up to 3
PDBs created without a license.
(create more and you need a
license, also not free in earlier
versions)
• RAC is no longer included in
standard edition in 19c. (need
EE)
• More risks to be non
compliant on SE DB and risk
EE licensing per core.
• More information and checks
to be aware of for Oracle SAM
professionals.
• Oracle are making Licensing
more difficult NOT easier.
WHY:

35. 4. Java Licensing
• Don’t wait for the
inevitable audit.
• After a license review is
complete it may take you 6
months before you are
able to make a decision
• Most Java installations are
not used but deployed as
wrongly assuming “free”
• Oracle have stopped reselling
Java from partners.
• Oracle wants you to sign Java
ULAs
• No formal Java audits seen
• Not uncommon to uninstall
90% on desktop Java.
• Not uncommon 70% of server
Java is not utilized/needed.
WHY:

36. 5. Oracle Changes to Audit Clause
• Contract leverage moved to
Oracle.
• Previously audit clause did
not mention “scripts/data
measurement” customers
could say they did not want
to run them. Oracle usually
accepted.
• You can renew your old
OMA as is or remove the
language about data
measurement tools.
• For various reasons you might
not want to run Oracle audit
scripts/measurement.
• 2 companies have renewed
old OMA without the audit
clause requirements.
• 1 company managed to
remove the mentioning about
data measurement tools
completely.
WHY:

37. Questions?