- Processor: Based on the number of processor cores where the software is installed
- Named User Plus (NUP): Based on the number of authorized individuals
- Application User: Similar to NUP, used for Oracle Applications products
- Employee: Based on the total number of employees in the customer’s organization
- $M Cost of Goods Sold: Based on the customer’s cost of goods sold
- Others: Trainee, Subscriber, Stream, UPK Module, Expense Report
Oracle Licensing Metrics
Oracle software licensing is based on clearly defined metrics designed to quantify software usage accurately and ensure compliance.
Choosing the correct licensing metric significantly impacts cost, compliance, and strategic software management.
This article explains Oracle’s key licensing metrics in depth, highlighting how they are calculated and applied and the specific Oracle products each metric covers.
Processor Licensing Metric
Oracle’s Processor Licensing metric is the most common for server-based products.
How Processor Licensing Works
Processor licensing involves counting the total processors or processor cores on servers running Oracle software. Oracle’s licensing rules for processor metrics are as follows:
- Identify the number of cores in each processor.
- Apply Oracle’s Processor Core Factor Table to calculate required licenses.
- Multiply the total cores by the applicable core factor.
Example:
If a server has 2 Intel Xeon processors, each with 8 cores (16 cores total), and Oracle’s Core Factor for Intel Xeon is 0.5, the organization must purchase licenses for 8 processors (16 cores x 0.5).
Products Licensed under Processor Metric
Oracle typically applies the Processor Licensing metric to server-intensive products, including:
- Oracle Database Enterprise Edition
- Oracle Database Standard Edition 2
- Oracle WebLogic Server
- Oracle Internet Application Server
- Oracle Real Application Clusters (RAC)
Named User Plus Licensing Metric
The Named User Plus (NUP) licensing metric is common for environments with a known and limited number of users accessing Oracle products.
How Named User Plus Licensing Works
NUP licensing involves counting all unique users who access Oracle software, directly or indirectly. Oracle applies minimum user licensing thresholds depending on the product and hardware used.
Typical Minimums:
- Oracle Database Enterprise Edition: 25 NUP licenses per processor.
- Oracle Database Standard Edition 2: 10 NUP licenses per server.
Example:
A server running Oracle Database Enterprise Edition on two Intel Xeon processors must license at least 50 Named Users (25 per processor) even if fewer than 50 users access the database.
Products Licensed under Named User Plus Metric
Common products licensed using NUP metrics include:
- Oracle Database (All editions)
- Oracle WebLogic Server
- Oracle Internet Application Server
- Oracle Business Intelligence (BI)
Application User Licensing Metric
The Application User licensing metric is specific to Oracle application products and is often tied to individual users’ access to application features.
How Application User Licensing Works
Application User licensing typically requires counting all individuals authorized to access Oracle application software. Each user requires one Application User license, regardless of actual usage frequency.
Products Licensed under Application User Metric
Oracle uses the Application User metric for products such as:
- Oracle E-Business Suite (specific modules)
- Oracle Siebel CRM
- Oracle JD Edwards EnterpriseOne
- Oracle PeopleSoft Enterprise (specific applications)
Example:
If an organization licenses Oracle Siebel CRM for 500 authorized users, it must purchase 500 Application User licenses, even if only 300 regularly use the system.
Employee-Based Licensing Metric
Employee-based licensing metrics, such as the one introduced for Java SE Universal Subscription, are based on the total number of employees within an organization rather than specific users or processors.
How Employee-Based Licensing Works
Under employee-based licensing, all full-time, part-time, and temporary employees and contractors who support internal business operations are counted. Licensing covers usage across all environments, including desktops, servers, and cloud deployments.
Typical Pricing Example (Java SE Subscription):
- 1-999 employees: $15 per employee/month
- 1,000-2,999 employees: $12 per employee/month
Products Licensed under Employee-Based Metric
The primary Oracle product using the employee-based metric is:
- Java SE Universal Subscription
Example:
A company with 1,500 employees would pay $18,000 monthly ($12 x 1,500) or $216,000 annually for a Java SE Universal Subscription.
Enterprise Licensing Metric
Enterprise Licensing typically covers large-scale licensing agreements designed for unlimited or broad organizational deployments.
How Enterprise Licensing Works
Enterprise Licensing involves licensing Oracle software based on organization-wide metrics, often including total revenue, employee count, or user base. Examples are Oracle Unlimited License Agreements (ULA) and Oracle Perpetual Unlimited License Agreements (PULA).
- ULA: Unlimited deployments during a fixed term (e.g., 3-5 years).
- PULA: Unlimited deployments indefinitely, with specific termination conditions.
Products Licensed under Enterprise Licensing Metric
Enterprise Licensing covers a wide range of Oracle products, typically databases and middleware solutions, such as:
- Oracle Database Enterprise Edition
- Oracle Real Application Clusters (RAC)
- Oracle Partitioning
- Oracle WebLogic Suite
Example:
A global enterprise signs a ULA for Oracle Database Enterprise Edition and RAC, allowing unlimited deployments within three years for a fixed upfront fee.
Concurrent Device Licensing Metric
Concurrent Device Licensing is based on the maximum number of devices that simultaneously access Oracle software.
How Concurrent Device Licensing Works
Under this model, licenses are based on the highest number of devices concurrently accessing Oracle software. It suits environments with shared terminals or kiosks.
Products Licensed under Concurrent Device Metric
Oracle applications occasionally use Concurrent Device licensing, including specific products within:
- Oracle Retail Solutions
- Oracle Hospitality Solutions
Example:
A retail chain licenses Oracle Hospitality for 300 point-of-sale devices. If no more than 200 devices ever concurrently access the software, 200 Concurrent Device licenses may suffice.
Expense Report Licensing Metric
Expense Report Licensing is specific to certain Oracle applications that manage financial or expense-related data.
How Expense Report Licensing Works
Organizations purchase licenses based on the number of expense reports processed annually.
Products Licensed under Expense Report Metric
- Oracle PeopleSoft Expenses
- Oracle Fusion Cloud Expenses
Example:
An organization processing 10,000 expense reports annually licenses Oracle Fusion Cloud Expenses for 10,000 expense reports. If the volume increases, additional licenses are required.
Revenue-Based Licensing Metric
Revenue-based licensing involves licensing fees tied to an organization’s revenue, often used for Oracle industry-specific solutions.
How Revenue-Based Licensing Works
Oracle calculates licenses based on the company’s annual revenue or specific revenue-generating activities, providing unlimited user access within the licensed revenue tier.
Products Licensed under Revenue-Based Metric
Revenue-based licensing frequently applies to:
- Oracle Communications Billing and Revenue Management (BRM)
- Oracle Financial Services solutions
Example:
A telecommunications company generating $500 million annually might license Oracle Communications BRM based on revenue tiers, regardless of user count.
Hosted Named User Licensing Metric
Hosted Named User Licensing applies to cloud-hosted services, counting named users authorized to access Oracle’s hosted environment.
How Hosted Named User Licensing Works
Organizations license Oracle’s hosted applications based on authorized named users, typically tracked annually.
Products Licensed under Hosted Named User Metric
- Oracle Fusion Cloud applications
- Oracle SaaS offerings (e.g., HCM, ERP, CRM)
Example:
An organization licenses Oracle Fusion Cloud ERP for 1,000 hosted named users. Additional named users require extra licenses.
Hosted Employee Licensing Metric
Hosted Employee Licensing counts all employees (full-time, part-time, temporary, and contractors) accessing or benefiting from Oracle’s cloud-hosted applications.
How Hosted Employee Licensing Works
Licenses cover all employees regardless of individual use. Pricing typically scales based on the total employee count.
Products Licensed under Hosted Employee Metric
- Oracle Fusion Cloud HCM
- Oracle Taleo Cloud Services
Example:
A company with 3,000 employees licenses Oracle HCM Cloud under the Hosted Employee metric, purchasing licenses for all 3,000 employees.
Metered Licensing Metric
Metered Licensing is usage-based, charging organizations based on measurable software usage or transactions.
How Metered Licensing Works
Organizations pay according to predefined usage metrics (transactions, storage, API calls). This flexible approach aligns costs closely with actual software use.
Products Licensed under Metered Metric
- Oracle Cloud Infrastructure (OCI) services
- Oracle Integration Cloud
Example:
An organization licensing Oracle Integration Cloud pays based on monthly transaction volume, scaling costs based on actual usage.
Conclusion: Selecting the Right Oracle Licensing Metrics
Oracle licensing metrics are critical to effective software license management, cost control, and compliance. Organizations should:
- Clearly understand each licensing metric and applicable Oracle products.
- Conduct detailed internal assessments to determine the best-fitting metric based on business requirements.
- Regularly revisit licensing metrics as organizational needs evolve.
By deeply understanding Oracle licensing metrics, organizations optimize software investments, ensure compliance, and align Oracle software licensing with strategic objectives.
