Oracle Licensing

Reducing Oracle Support Costs

Oracle Support Reduction Optimization

  • Third-Party Support: Consider providers like Spinnaker Support for significant savings.
  • Terminate Unused Licenses: Stop paying for non-utilized licenses.
  • Downgrade Versions: Switch from Enterprise to Standard editions.
  • License Optimization: Adjust license models to save costs.
  • Cloud Transition: Migrate to Oracle Cloud or alternatives like AWS.
  • Hardware Changes: Consider platforms like IBM LPAR.
  • Negotiate with Oracle: Engage in discussions for discounts.
  • Stay Updated: Keep software current to avoid higher fees.

Introduction to Oracle Support Renewals

Oracle support renewals are essential for maintaining access to updates, patches, and technical assistance for Oracle products.

Understanding the costs associated with these renewals is crucial for effective budget management. Optimizing Oracle support renewals can lead to significant cost savings, making it a strategic priority for many organizations.

Oracle Support Renewal Optimization

Oracle Support Renewal Optimization

Understanding Oracle Contracts and Policies

Familiarize yourself with Oracle’s contracts and policies, including terms that govern support fee adjustments and terminations. This knowledge is foundational for developing a cost-reduction strategy.

Developing a Strategy to Reduce Oracle Support Fees

Crafting a strategy involves assessing your current Oracle support contracts and identifying areas for potential savings. The goal is to minimize costs without compromising the support quality needed for your operations.

Key Steps in the Optimization Process:

  • Review Oracle Contracts: Thoroughly examine the details of your Oracle contracts to understand your obligations and opportunities for adjustments.
  • Familiarize with Oracle Policies: Understand Oracle’s support policies, such as the Matching Service Levels and Repricing policies, to navigate potential reductions effectively.
  • Identify Opportunities for Savings: Consider clauses or terms allowing fee reductions, such as terminating unused licenses or downgrading from higher to lower software editions.
  • Plan Negotiation Approaches: Develop a negotiation strategy to engage with Oracle representatives. Highlight your understanding of your specific needs and usage to negotiate better terms, potential discounts, and price reductions.

Oracle Technical Support Policies

Oracle Support Renewal Optimization

Overview of Key Oracle Support Policies:

  1. Matching Service Levels: Oracle requires that all licenses within a product family have the same support level. This ensures consistency and prevents partial support scenarios.
  2. Reinstatement Fee: If support lapses or was not initially purchased, a reinstatement fee of 150% of the last annual support fee or the fee that would have been charged originally is assessed.
  3. Repricing of Technical Support: When licenses are terminated, the remaining licenses’ support costs are recalculated based on the current list price minus standard discounts, often resulting in higher costs for the remaining licenses.

Detailed Explanations and Examples:

  • Matching Service Levels: If a company owns 50 Oracle database licenses, they must all be supported at the same level. Dropping support for only a portion of these licenses is not allowed, maintaining uniform support coverage.
  • Reinstatement Fee: If a company stops Oracle support and wants to reinstate it later, it will need to pay a fee that could be 150% of the previous support costs, making it expensive to return to Oracle support.
  • Repricing of Technical Support: Suppose an organization reduces its licenses from 100 to 70. Oracle will recalculate the support costs for the remaining 70 licenses based on the list price, potentially nullifying any anticipated savings.

What is Oracle Extended Support?

Definition and Cost Implications: Oracle Extended Support provides continued updates and fixes beyond the Premier Support period, typically at a higher cost.

It is usually 10-20% more expensive than Premier Support due to the increased costs of maintaining older software versions.

Comparison with Premier and Sustained Support:

  • Premier Support: Offers full updates, fixes, and enhancements for a defined period.
  • Extended Support: Extends the full support period but at a higher cost.
  • Sustained Support: Provides access to existing updates and fixes without new enhancements, usually after Premier and Extended Support periods.

Before Renewing Oracle Support: 4 Key Recommendations

  1. Active Use Verification: Ensure that all Oracle licenses are actively used. Conduct a pre-renewal review to avoid paying for unused licenses.
  2. Annual Oracle License Optimization: Regularly optimize Oracle licenses to reduce unnecessary costs. This can often reduce licensing needs by 10-30%.
  3. Bypassing Oracle’s Repricing Rule: Strategize to bypass Oracle’s repricing policies, which can result in higher support costs even after reducing licenses.
  4. Realistic Expectations from Oracle Support Negotiations: When negotiating with Oracle, the best achievable outcome is often waiving the annual 8% uplift rather than significant fee reductions. Manage expectations accordingly.

Top 10 Strategies to Reduce Oracle Support Costs

Top 10 Strategies to Reduce Oracle Support Costs
  1. Third-Party Support: Consider third-party support providers like Spinnaker Support or Rimini Street. They can often provide substantial savings, sometimes up to 50%, compared to Oracle’s support fees. This option precedes Oracle’s updates and patches but can significantly reduce costs.
  2. Evaluate License Usage: Conduct a thorough review of all Oracle licenses. Identify and terminate support for any idle or underused licenses. This step ensures you only pay for what you use, potentially saving a substantial amount on support fees.
  3. Software Downgrading: Assess if your organization can function effectively with lower-tier software editions. Downgrading from Oracle Enterprise Edition to Standard Edition can lead to significant savings, especially if you are not using the advanced features of the Enterprise Edition.
  4. License Model Optimization: Reevaluate your current license models. Switching from processor-based licenses to named user-plus licenses or other models could lead to cost reductions. Optimize the licensing model to match actual usage patterns and business needs.
  5. Terminate Unused Licenses: Carefully manage the termination of unused licenses, keeping Oracle’s technical support policies in mind. Understand the implications of terminating licenses, such as the potential repricing of remaining licenses, and plan accordingly to avoid unexpected costs.
  6. Leveraging Oracle Cloud: Explore migrating some environments to Oracle Cloud, especially test and development environments. This move can reduce support costs as cloud subscriptions often include support and are billed based on actual usage rather than a perpetual license model.
  7. Migrating to AWS or Azure: Consider alternative cloud platforms like AWS or Azure for running Oracle workloads. These platforms may offer more cost-effective licensing options and better flexibility, potentially reducing overall costs.
  8. Change Hardware Platform: Evaluate the cost benefits of changing hardware platforms. For example, consolidating workloads onto IBM LPAR (Logical Partitioning) can reduce the number of Oracle licenses required, leading to lower support costs.
  9. Complete Oracle Exit: For some organizations, discontinuing Oracle support might be viable. This approach involves transitioning to alternative solutions or platforms, which requires careful planning but can eliminate Oracle support fees.
  10. Negotiating with Oracle: Engage proactively with Oracle for better support terms. Strategies may include leveraging existing relationships, clearly understanding your organization’s Oracle usage, and being prepared to discuss alternative support options. Negotiating can sometimes result in discounts or more favorable terms.

These strategies require thoroughly understanding your organization’s specific Oracle usage and support needs. Implementing these steps can save significant costs while ensuring continued access to necessary support services.


  • Fredrik Filipsson

    Fredrik Filipsson brings two decades of Oracle license management experience, including a nine-year tenure at Oracle and 11 years in Oracle license consulting. His expertise extends across leading IT corporations like IBM, enriching his profile with a broad spectrum of software and cloud projects. Filipsson's proficiency encompasses IBM, SAP, Microsoft, and Salesforce platforms, alongside significant involvement in Microsoft Copilot and AI initiatives, enhancing organizational efficiency.

    View all posts