Siebel Pricing – How to Calculate Licensing Fees

How Does Siebel Pricing Work?

• Component Licensing: Licenses individual products for specific users.
• Custom Application Suite (CAS) Licensing: Bundles multiple applications for defined users.
• Enterprise Licensing: Licenses the entire organization without tracking individual users.
• User-Based Metrics: Includes Named User, Application User, Custom Suite User, and Concurrent User licenses.
• Hardware-Based Metrics: Includes Processor, Physical Server, and Computer licenses.

Siebel Pricing

Siebel CRM is licensed through a modular, user-based model that can become costly without proper planning. Every user needs a core Siebel CRM Base license (and possibly industry-specific add-ons), with list prices in the thousands of dollars per user.

This advisory overview provides an overview of how Siebel licensing works, typical pricing, and strategies for negotiating better terms. Enterprises should leverage this knowledge to manage Siebel license costs effectively while avoiding compliance pitfalls.

Understanding Siebel’s Licensing Structure

Oracle Siebel CRM uses a modular licensing approach. This means you license the Siebel CRM Base Application for each user and then add any extra modules needed for that user’s role or industry.

Every internal user must at a minimum have the Siebel base license, which provides core CRM functionality (accounts, contacts, etc.).

If you require industry-specific capabilities (for example, a tailored version for Financial Services or Telecom), an additional Industry Base module is required for each user as well. In practice, a user may have a base CRM license, plus one or more module licenses (such as Sales, Service, or Marketing), assigned to them to cover all the functionality they use.

Siebel’s modular licensing structure requires each user to have a Base CRM license and any relevant add-on module licenses. The total cost per user depends on which modules (e.g., industry-specific options or specialized tools) are added to the base license.

This structure allows organizations to tailor licenses to their needs, but it also means costs scale with the number of users and modules deployed. All users accessing Siebel must be licensed appropriately – there’s no sharing of accounts or mixing licensed and unlicensed users on the same system. If an industry-specific edition is used (such as Siebel for Communications or Financial Services), every user requires the corresponding industry module license in addition to the base license. Oracle’s policy is “all or nothing” for industry solutions, ensuring consistency (and revenue) across the user base.

License Models and User Metrics

Siebel offers several license metrics to accommodate different usage scenarios. Understanding these metrics is critical for both compliance and cost optimization:

• Application User (Named User) – The most common metric, this is a per-named-user license for each employee or internal user who accesses Siebel. If 100 employees use Siebel, you need 100 licenses. Each license is assigned to an individual (not shared or concurrent). This metric encompasses core Siebel CRM modules (such as Sales and Service) for internal users.
• Industry Module User – For industry-specific versions (e.g., Siebel Financial Services), the metric is similarly per user. These are essentially add-on licenses on top of the base for each user in that industry deployment.
• Registered User – A named user license for external users like partners or customers accessing Siebel (for example, through a partner portal or customer self-service site). This metric is used instead of Application User for non-employees. It is typically priced separately and sometimes at a different rate, since it covers external parties.
• Named User Plus (NUP) – A variation of the named user metric that also counts non-human operated accounts (e.g., service accounts, scripts, or any account that accesses the software). In Siebel, NUP licenses might appear for certain technical components or older licensing agreements. The concept ensures that if you use a single technical login for multiple people (via a proxy or integration), those hidden users are still counted towards licensing. NUP is less common for Siebel CRM itself, but you might encounter it for related Oracle components (like management tools or older contracts).
• Processor License – This is a capacity-based metric where you license the Siebel software per server CPU (processor) instead of per user. A processor license permits unlimited users on that server. Oracle defines the number of cores that count as a processor based on a core factor table. This model is useful if you have a very large or hard-to-count user base (for instance, a public-facing Siebel portal with thousands of users). It’s expensive per processor (often priced in the tens of thousands of dollars each) but can be cost-effective when user counts would otherwise be enormous. Many external-facing Siebel modules (like customer-facing web portals or e-commerce via Siebel) can be licensed this way to allow unlimited external users.
• Legacy Concurrent User – Siebel historically offered concurrent user licensing (a pool of shared licenses for a maximum number of simultaneous users). Oracle has discontinued selling new concurrent licenses for Siebel after the acquisition. Suppose your organization has old Siebel concurrent user licenses. In that case, they can be used under grandfathered terms, but be cautious: exceeding the allowed concurrent count even once can violate compliance and trigger a forced migration to named user licensing. Companies with legacy concurrent licenses must monitor usage closely to avoid any overage.

In addition to these user-centric metrics, a few Siebel components utilize usage-based metrics (for example, licensing based on the number of customer records or transactions for specific modules, such as Siebel Loyalty). These are less common, but if you use such modules, ensure you track the usage units (e.g., number of loyalty program members) to stay within licensed bounds.

Pricing Components and Cost Structure

Siebel’s pricing is composed of upfront license fees for each component plus recurring support fees. Oracle’s list prices for Siebel can be quite steep, but they provide a baseline for negotiations.

As of late 2024, key list prices for Siebel licenses were:

License fees are typically one-time (perpetual) costs that grant a permanent right to use that version of the software. The Software Update License & Support fee is charged annually (usually 22% of the net license cost) to provide access to updates, patches, and Oracle support services.

For example, a Siebel Base license, priced at $3,750, incurs a yearly support cost of $825 per user. These support fees are not optional if you want to stay on Oracle’s maintenance and upgrade path – and they can increase over time (Oracle often applies a small percentage increase each year unless you negotiate price protection).

Beyond the base and industry licenses, Siebel includes many optional modules (for specific functionality like Loyalty management, Partner Portal, etc.). Most of these also have per-user list prices (commonly in the few-hundred-dollar range each).

If you deploy such modules, their costs will add on per user in addition to the base. For instance, if a user requires Siebel Call Center functionality, a specific license for that module may be available at an additional cost per user. It’s essential to consider all modules in use when calculating total license requirements.

Real-World Pricing Example: Suppose a company has 150 internal users on Siebel in the Communications industry. They would need 150 Siebel Base licenses (150 × $3,750) plus 150 Communications Industry licenses (150 × $400) at list price, which totals $625,500 in license fees.

Additionally, annual support at 22% would amount to approximately $137,610 per year. However, in real enterprise deals, Oracle’s list price is just a starting point. Significant discounts are common – for a deal of this size, a savvy customer might negotiate a discount of 50% or more off the license costs.

At a 50% discount, the license cost drops to $312,750, and Oracle’s support fees would typically be 22% of that discounted price ($68,800 per year). This illustrates the crucial role of negotiation in achieving a reasonable total cost of ownership (TCO) for Siebel.

Contract Negotiation Strategies

Negotiating with Oracle for Siebel licenses can substantially lower your costs and improve contract terms. Here are key strategies and considerations for enterprise buyers:

• Negotiate Discounts Aggressively: Oracle’s sales reps expect customers to push back on the high list prices. Volume discounts are routine – the more users or the larger the deal, the deeper the potential discount. It’s not unusual to secure discounts of 30–70% off the list price, depending on the size of the purchase and the timing. Always treat the list price as a flexible starting point.
• Timing and Sales Quotas: Leverage Oracle’s fiscal calendar to your advantage. Oracle representatives have quarterly and annual targets; deals closed near quarter-end or fiscal year-end (Oracle’s year ends in May) often get better terms. If you can time your purchase or renewal to coincide with these crunch times, you may unlock extra discounts or incentives.
• Bundle Modules in a Suite: If you need multiple Siebel modules (e.g., Sales, Service, and Marketing) together, ask Oracle for a custom Siebel suite license. Oracle can create a Custom Application Suite bundle that covers a set of modules for a single price per user. This can simplify licensing and potentially result in a lower combined cost than purchasing each module individually. Ensure the bundle includes all the necessary functionality, and negotiate a lower price per user – the bundle should offer a cost benefit for your broader commitment. (Be wary of Oracle simply summing up the list prices of each component; a bundle deal should reflect a discount for the package.)
• Consider an Enterprise Agreement (ULA): For very large Siebel deployments, an Unlimited License Agreement (ULA) or enterprise license can be negotiated. This is a fixed-fee, time-bound deal (commonly 2-3 years) where you pay upfront and can deploy unlimited Siebel licenses during that term. Ultimately, you certify your usage, and that becomes your perpetual entitlement. A ULA can be cost-effective if you anticipate massive growth in users or are rolling out Siebel broadly. However, ULAs require careful negotiation on scope (including which modules are included and how the certification works) to ensure you get value. Only consider this if you have a clear expansion plan, and negotiate safeguards (like including all key modules, and clarity on post-ULA support fees or options to reduce scope if needed).
• Protect Against Support Cost Creep: Oracle’s standard support is 22% of your license purchase price, and they often increase it by a few percent annually. You can negotiate caps on support fee increases or even a reduced support percentage as part of the deal. For example, try to stabilize support at 22% with no more than a 0-3% annual increase, or negotiate a lower support base rate (some customers have achieved reductions, such as paying 17-18% instead of 22%, especially when threatening to leave Oracle support). Locking in these terms at the time of purchase can save millions over the life of a Siebel implementation.
• Non-Production and Development Use: By default, any use of Siebel (including in test or development environments) is licensed. In negotiations, you can seek concessions like free or discounted development/test licenses. Oracle sometimes allows a certain number of non-production users or a percentage of licenses to be used in test environments at no extra charge, but only if you explicitly negotiate it. Ensure that any special terms for development or testing usage are included in the contract to avoid unexpected costs later.
• Leverage Future Commitments: If your company has broader plans with Oracle (such as other software purchases or cloud services), use that as leverage. Oracle may offer better Siebel pricing if it sees a long-term relationship or a bundling opportunity. Conversely, if you’re considering phasing out Siebel in favor of another solution, you could use that as leverage, too – Oracle might drop prices to dissuade you from leaving. Be cautious with this tactic, but it’s a valuable part of your negotiation toolkit.
• Engage Experts or Benchmarking: Oracle licensing is notoriously complex. Consider involving a third-party licensing advisor or using industry benchmarks to verify the deal’s terms. Knowing what discounts other similar clients achieved or what Oracle’s sales reps are authorized to approve can strengthen your position in negotiations.

Managing Compliance and License Optimization

After signing the deal, ongoing management of Siebel licenses is crucial. Oracle is known for auditing customers’ software usage, and Siebel is no exception.

To avoid compliance issues and get the most value out of what you’ve purchased, keep these practices in mind:

• Track and Control User Access: Maintain an up-to-date roster of Siebel users and which licenses (modules) each user is assigned. When employees leave or no longer need access, promptly deactivate their accounts. This allows you to reallocate that license to another user, thereby avoiding the need to purchase new licenses unnecessarily. Many compliance troubles come from inactive accounts or “role creep” where more users have access than licenses purchased. Conduct periodic internal audits to compare active user counts in Siebel with your licensed counts.
• Avoid Unauthorized Module Use: Siebel’s software might not technically prevent you from enabling a module you haven’t licensed, especially if a feature was installed or a trial key was used. It’s up to your administrators to ensure only licensed modules are active and accessible to users. Configure role-based access controls so that no one can accidentally use a module that isn’t licensed. Oracle auditors will look for the use of unlicensed components (e.g., if you activated the Siebel Marketing module without a license). Ensure you have governance to prevent this scenario.
• Proper Licensing for Environments: Unless your contract stipulates otherwise, licenses are generally required for any environment where the software is used. That means if you have separate test, development, or disaster recovery installations of Siebel, those systems should not be accessed by more users than you have licenses for (often, companies only allow licensed production users to use test systems, or they negotiate some test-only user licenses). Clarify your contract terms regarding non-production environments and ensure compliance with them, or negotiate those rights upfront as noted.
• External User Licensing: If you expose Siebel to external users (partners, customers), ensure you’ve accounted for this with the correct license metric (such as Registered User or a processor license for a portal). Do not allow external individuals to use internal accounts; this violates contract terms. Keep internal and external usage separated in your licensing approach, as Oracle audits will scrutinize this distinction.
• Shelfware and Support Waste: Evaluate your Siebel license utilization over time to identify areas for improvement. It’s common for companies to end up with more licenses than they use (for instance, after an initial purchase, the rollout may cover fewer users than anticipated, resulting in shelfware). If you’re paying maintenance on a chunk of unused licenses, that’s wasted spend. Oracle typically won’t volunteer to reduce your support costs, but you can attempt to terminate or reallocate unused licenses at renewal. It may require negotiation (Oracle often tries to enforce policies that prevent dropping support on licenses without terminating all of them, etc.). Still, savvy customers have negotiated reductions by showing they are over-licensed. At a minimum, use surplus licenses for new users or new modules whenever possible, rather than purchasing additional ones.
• Prepare for Audits: Always be audit-ready. Keep good records of your entitlements (the licenses you purchased and the contract documents) and your usage (user lists, modules enabled, server details for any processor licenses). Oracle’s License Management Services (LMS) could audit your Siebel deployment, and if they find you’re using more than entitled, they will charge back-support fees and require license purchases to cover the gap. Proactive compliance is far less expensive than a post-audit penalty or purchase. If you stay on top of the points above, an audit should not catch you off guard.
• Third-Party Support Options: One way some Siebel customers optimize costs is by switching to third-party support providers once the system is stable and they no longer require Oracle’s updates. Companies like Rimini Street offer support for Siebel at roughly 50% of Oracle’s annual support fee. This can cut recurring costs dramatically. However, moving off Oracle support has implications: you won’t receive new patches or upgrades from Oracle, and Oracle may refuse to support or certify your environment if you come back. If you consider third-party support, do so only after verifying your license compliance (Oracle often audits customers who drop support), and download all the latest patches/documentation before your Oracle support ends. Using the possibility of third-party support as a negotiation lever can sometimes even prompt Oracle to offer a better support discount to retain your business. Weigh the risks and benefits – for a steady-state Siebel deployment, third-party support can save money, but you must be comfortable relying on the provider and potentially forgoing Oracle’s future product enhancements.

Recommendations

• Assess Needs Before Buying: Thoroughly evaluate which Siebel modules and the number of users you truly need. Avoid purchasing components “just in case.” Start with essential licenses and add on as needed to prevent costly shelfware.
• Negotiate Beyond Price: Don’t just negotiate the license discount – also negotiate support terms, deployment rights (e.g., test environments), and future flexibility. Aim to include clauses that allow you to scale down support or swap licenses if your needs change.
• Time Your Purchase Strategically: Engage Oracle at times when they are more likely to concede (quarter-end/fiscal year-end). Enter negotiations with a clear budget and alternative options, and be willing to walk away if terms aren’t favorable.
• Utilize Expert Insight: Leverage Oracle licensing experts or peers who have gone through Siebel deals. Benchmark discount levels and contract terms. An informed approach can reveal concessions that Oracle sales may not initially offer.
• Monitor and Optimize Continuously: Post-purchase, treat license management as an ongoing process. Conduct internal license audits regularly, reclaim unused licenses, and ensure you’re using what you pay for. Use this data to inform renewal negotiations – for instance, drop maintenance on genuinely unused licenses or negotiate offsets (like extra products or cloud credits) if you’re stuck paying for them.
• Consider Future Roadmap: If Oracle is encouraging a move to their cloud CRM or another product, use that in negotiations for your Siebel renewal (“Give us a better deal now, and we’ll consider Oracle in the future”). Conversely, if you plan to stick with Siebel long-term, negotiate long-term price protections (caps on support increases, options to purchase additional users at a fixed discount).
• Stay Compliant Proactively: Invest in compliance monitoring tools or processes for Siebel. The cost of a license management tool or periodic third-party review is far less than an Oracle audit true-up. Ensure your IT governance encompasses user provisioning/deprovisioning and module access controls, taking licensing into account.

Checklist

• ☐ Inventory Current Usage: List all Siebel modules in use and count active users for each. Match this against your licensed entitlements to identify any shortfall or excess.
• ☐ Review Contract Terms: Understand your Siebel license agreement – note the metrics, restrictions (e.g., external use, non-prod usage), and support policies. Ensure compliance with these terms or plan to renegotiate problematic clauses at renewal.
• ☐ Optimize Before Expansion: Before requesting more licenses or modules, fully utilize what you have. Reassign unused licenses to new users or retire unused modules to avoid unnecessary purchases.
• ☐ Engage Stakeholders Early: If a contract renewal or expansion is upcoming, start conversations with procurement, IT, and an Oracle account manager well in advance. Develop a negotiation plan that includes desired discounts and terms, and secure executive buy-in to maximize leverage.
• ☐ Consider Support Alternatives: Evaluate whether Oracle support is delivering value for its cost. If your Siebel implementation is stable and you don’t need frequent updates, consider researching third-party support as a bargaining chip or cost-saving measure – but weigh the trade-offs and ensure you’re prepared for the change (e.g., have all necessary patches and documentation in hand).

FAQ

Q: How is Siebel CRM typically licensed? Are licenses perpetual or subscription?
A: Siebel is usually licensed on a perpetual basis per named user or processor. You pay a one-time license fee for each user (or processor) and then pay annual support (maintenance) fees to Oracle. While Oracle offers cloud subscription models for other products, Siebel itself is an on-premises product and is not sold as a SaaS; however, Oracle may offer term licenses (time-limited) upon request. In most cases, enterprises own Siebel licenses perpetually and just renew support each year. Subscription licensing isn’t common for Siebel, so expect a traditional buy-and-maintain model.

Q: What does a Siebel license cost per user?
A: The list price for a basic Siebel CRM user (the Base Application license) is roughly in the mid-thousands of dollars (about $3,750 per user at list). Additionally, if you require an industry-specific module, the cost is approximately $400 per user. Additional functional modules (like analytics, loyalty, etc.) each have their own price (often a few hundred dollars per user). These are list prices – actual prices can be much lower after negotiation. For example, an enterprise might negotiate that $3,750 base cost down to $1,500 or less per user through volume discounts. Always remember to account for the annual support cost (~22% of the net license price) when calculating the total cost per user over time.

Q: How can we reduce the cost of Siebel licensing?
A: There are several ways to optimize Siebel costs. First, negotiate aggressively – aim for a substantial discount off the list price and favorable terms (such as fixed support costs or bundle pricing if you require multiple modules). Second, right-size your license counts: only buy for the users and modules you truly need, and consider phasing implementation to avoid upfront overspend. Third, consider alternatives such as an Unlimited License Agreement if you anticipate rapid growth, but weigh the pros and cons carefully. Additionally, controlling ongoing support costs is key – you might negotiate a lower support rate or consider third-party support for older, stable environments. Finally, maintain compliance to avoid pricey surprises – it’s cheaper to manage licenses properly than to pay audit penalties.

Q: What are common compliance pitfalls with Siebel licensing?
A: A few issues regularly trip up Siebel customers. One is not having enough licenses for all active users – sometimes test accounts, contractors, or service integrations are overlooked and not licensed, which an audit will flag. Another pitfall is using modules that weren’t purchased. Siebel doesn’t always enforce licenses in software, so a well-meaning admin might enable a feature (such as a specific industry module or add-on) without realizing it requires a license; this results in compliance gaps. Additionally, misclassifying users poses a risk (e.g., granting external partner users access under internal licenses). And if you had legacy concurrent user licenses, exceeding the concurrent limit even briefly voids the terms. To avoid these issues, implement strict internal controls: regularly reconcile user accounts with licenses, lock down module access, and educate your IT team on what usage is allowed under your contract.

Q: Can we drop Oracle support for Siebel to save money?
A: Yes – some companies choose to drop Oracle’s support and go with a third-party support provider (or self-support) to save on the 22% annual fees. This can cut support costs by 50% or more. However, doing so means you won’t get updates, patches, or official Oracle help. Before dropping support, ensure your system is stable on a version you’re comfortable running for an extended period. You should download any critical patches available while you still have access to them. Be aware that Oracle may attempt an audit if they suspect you’re leaving support, so ensure you’re fully compliant before making the switch. Also note, if you ever need to return to Oracle support, they will charge backdated fees and penalties (a reinstatement fee), which can be very expensive. Many organizations use the threat of leaving support as leverage to negotiate a better deal from Oracle. For example, Oracle might offer a discount or freeze on support price increases to keep you. Weigh the pros and cons: third-party support can yield big savings, but it’s effectively a one-way move and works best for deployments that don’t require new Oracle enhancements.