oracle license agreements / Oracle pool of funds

What is Oracle Pool of Funds (enterprise license agreement)

What is Oracle Pool of Funds?

  • A contract between Oracle and a customer.
  • Allows purchasing a predetermined number of Oracle software licenses in advance.
  • Licenses are pooled for flexible deployment across servers or devices.
  • Reduces the need for per-server or per-device licenses.
  • Ideal for organizations with fluctuating software usage needs.

What is Oracle Pool of Funds?

What is Oracle Pool of Funds?

Definition and Basic Concept The Oracle Pool of Funds (PoF) is a flexible licensing agreement that allows customers to pre-purchase a specific amount of Oracle software licenses.

These licenses are pooled together, providing the customer with the flexibility to deploy the software across various servers or devices as needed over 2-3 years.

This arrangement helps organizations manage their software licenses more effectively by allowing them to draw from the pool as their needs arise rather than purchasing licenses individually for each server or device.

Suitable for Companies Experiencing Growth in Oracle Software Products with Uncertain Product Mix

  • Flexibility: The PoF agreement is particularly beneficial for companies experiencing growth in their use of Oracle software products but is uncertain about the exact product mix they will need.
  • Adaptability: By purchasing a pool of licenses, companies can ensure they have the necessary licenses available as their software requirements evolve without having to predict their exact needs in advance.

Alternative to an Unlimited License Agreement (ULA) or Large-Volume Purchase

  • ULA Alternative: The PoF can be used as an alternative to the Oracle Unlimited License Agreement (ULA) or large-volume purchases.
  • Reduced Upfront Commitment: While a ULA offers unlimited use of specified Oracle products for a fixed period, it often requires a significant upfront commitment and may not be suitable for organizations with fluctuating needs.
  • Cost-Effective: The PoF provides flexibility by allowing companies to scale their usage up or down within the limits of the pre-purchased pool, making it a cost-effective solution for managing variable software demands.

When to Consider Oracle Pool of Funds

When the Product Mix is Uncertain

  • Unpredictable Needs: Organizations unsure about the specific Oracle software products they will need in the future should consider the PoF.
  • Flexible Allocation: This agreement allows them to purchase a flexible pool of licenses without committing to specific products upfront.
  • Compliance: As their needs change, they can allocate licenses from the pool to the required products, ensuring they remain compliant and adequately licensed.

When Avoiding Commitment to an Oracle ULA and Consolidating Legacy Support into One CSI

  • Avoid ULA Commitment: Companies that prefer not to commit to an Oracle ULA, which can be rigid and expensive, may find the PoF a more suitable option.
  • Simplify Management: The PoF allows for consolidating legacy support into a single Customer Support Identifier (CSI), simplifying license management and support processes.
  • Streamline Operations: This can be particularly advantageous for organizations looking to streamline their Oracle license management and reduce administrative overhead.

When Aiming for High Discount Rates for On-Premises Software

  • Cost Savings: The PoF agreement offers the potential for high discount rates on Oracle software licenses.
  • Bulk Purchase Benefits: Organizations that purchase licenses in bulk can negotiate significant discounts, reducing their overall software costs.
  • Maximize ROI: This is especially beneficial for companies that use a large amount of on-premises Oracle software and want to maximize their return on investment by minimizing license expenses.

By considering these factors, organizations can determine whether the Oracle Pool of Funds License Agreement is the right choice for their licensing needs. It provides the flexibility and cost savings required to support their growth and operational goals.

Potential Drawbacks of Oracle Pool of Funds

All Products Purchased Through PoF Belong to One Customer Support Identifier (CSI)

  • Unified CSI: All products purchased through the PoF agreement are grouped under a single Customer Support Identifier (CSI).
  • Repricing Rule: These products are subject to Oracle’s repricing rule, which can complicate cost management and budgeting.

Challenges in Reducing Future Oracle Maintenance Costs

  • Fixed Maintenance Fees: The consolidated CSI and repricing rule can make reducing future Oracle maintenance costs difficult.
  • Cost Inflexibility: Organizations may find negotiating lower maintenance fees for specific products within the pool challenging.

Limitations in Terminating Other Support Contracts

  • Support Contract Restrictions: The PoF agreement includes clauses that prevent customers from terminating other support contracts that contain products covered by the PoF.
  • Reduced Flexibility: This limitation can reduce customers’ flexibility in managing their overall Oracle support and maintenance strategy.
  • Vendor Lock-In: The inability to terminate certain contracts can result in vendor lock-in, making switching to alternative support solutions harder.

Grasping the Total Support Stream in PoF Agreements

Explanation of Total Support Stream The Total Support Stream is a critical component of the PoF agreement. It encompasses the support maintenance for various types of licenses within the pool.

Existing Licenses

  • Definition: These are licenses for software programs already included in the Pool of Funds when the agreement was signed.
  • Support Coverage: Existing licenses are covered under the same support terms as new and acquired ones, ensuring continuity of support services.

New Licenses

  • Definition: Licenses for software programs added to the Pool of Funds during the agreement period.
  • Flexibility: New licenses allow organizations to expand their usage of Oracle software as their needs evolve, with support included.

Acquired Licenses

  • Definition: Licenses for software programs that become part of the Pool of Funds through acquisitions of other companies by the end-user.
  • Integration: Acquired licenses are integrated into the existing support structure, ensuring comprehensive coverage for all included software.

Additional New Licenses

  • Definition: These are new licenses for software programs included in the agreement purchased after the Pool of Funds’ signature date, often against a price hold.
  • Expanded Coverage: Additional new licenses allow users to extend the use of Oracle software under the existing PoF agreement, maintaining support consistency.

Understanding the Total Support Stream and its components can help organizations better manage their Oracle software licenses and ensure continuous support throughout the agreement period.

Annual Technical Support Fees

Annual Technical Support Fees

Obligation to Pay Annual Technical Support Fees

  • Mandatory Fees: End-users must pay annual technical support fees as part of the Pool of Funds agreement.
  • Calculation: These fees are calculated based on the total value of the Pool of Funds agreement.

Fees Apply from the Start

  • Immediate Payment: The obligation to pay these support fees begins at the start of the agreement period, even if the end-user has not yet deployed any software.
  • Continuous Coverage: This ensures that all licenses, whether currently in use or not, are covered under Oracle’s support services from the outset of the agreement.

Consequences of Non-Compliance

Consequences of Non-Compliance

Immediate Termination of the Pool of Funds Period

  • Compliance Requirement: Maintaining the Total Support Stream is a critical compliance requirement under the Pool of Funds agreement.
  • Termination Clause: If an end-user fails to maintain this support stream, Oracle has the right to terminate the Pool of Funds period immediately.

Requirement to Declare Current Deployment

  • License Declaration Report: Upon termination, the end-user must submit a License Declaration Report that details the current deployment of Oracle software.
  • Transparency: This report ensures transparency and compliance by documenting how the software licenses have been utilized.

Potential Penalties or Contract Terminations

  • Penalties for Non-Compliance: Failure to comply with the reporting and support requirements can result in financial penalties.
  • Risk of Contract Termination: In severe cases, non-compliance may lead to the termination of the Pool of Funds agreement, affecting the end-user’s ability to continue using Oracle software under the agreed terms.

By understanding these obligations and potential consequences, organizations can better manage their compliance with the Oracle Pool of Funds agreement, ensuring continuous support and avoiding penalties.

Oracle Pool of Funds: Pros and Cons


  • High Discount Rates: Customers can negotiate significantly higher discount rates than individual license purchases.
  • Flexibility in Choosing Products: Allows organizations to select the products they need, covering only the parts of the PoF license agreement that are relevant to them.


  • Products Belong to One CSI and are Subject to Oracle’s Repricing Rule: All products purchased through PoF are grouped under a single Customer Support Identifier (CSI), making it difficult to manage future maintenance costs.
  • Restrictions on Terminating Other Support Contracts: The PoF agreement includes clauses that prevent customers from terminating other support contracts that include products covered by the PoF.
  • Additional Investments Required for Products Outside the PoF: If customers need additional products not covered by the PoF, they must purchase them separately, which can increase costs.
  • Ongoing Technical Support Costs After PoF Expires if Total Amount is Not Spent: Customers who have not fully utilized the pool of funds will continue to pay technical support costs even after the PoF agreement expires.

Understanding the License Declaration Report

Understanding the License Declaration Report

Significance of the License Declaration Report:

  • Compliance: The License Declaration Report is a crucial document that ensures Oracle users comply with their agreement terms.
  • Transparency: It provides a detailed account of software program deployment, ensuring that only the software for which licenses have been paid is used.

Mandatory Submission for Compliance:

  • Obligation: Submitting the License Declaration Report is mandatory for maintaining compliance with Oracle’s reporting requirements.
  • Frequency: Typically, reports need to be submitted annually, but the exact frequency can vary based on the agreement.

Detailed Contents Required in the Report:

  • Comprehensive Details: The report must include every installation of Oracle software programs, regardless of their purpose (e.g., production, test, development).
  • New Deployments: It should only include new software licenses deployed since the last report, except for the initial report at the start of the agreement.
  • Excluded Programs: Any software programs or license types not included in the PoF agreement cannot be declared.

Post-Submission Process and Implications:

  • Fixing License Quantities: Oracle will fix the quantity of declared software licenses as perpetual licenses after submission.
  • Burn Down Value: The financial value of the declared licenses is deducted from the total Pool of Funds value.
  • Additional Purchases: Additional licenses must be purchased separately if the total Pool of Funds Credit value is reached.

What Occurs When the Oracle Pool of Funds Agreement Expires?

What Occurs When the Oracle Pool of Funds Agreement Expires?

Final License Declaration Report:

  • Requirements and Deadlines: The end-user must provide a final License Declaration Report within 30 days after the agreement expires.
  • Total Quantity of Licenses: This report must declare the total quantity of software licenses acquired under the Pool of Funds agreement.

Additional Software Licenses:

  • Procedure if Value is Used Up: If the total value of the agreement is used up before it expires and more software is deployed, additional licenses must be purchased.
  • Separate Purchase: This means buying the required licenses separately if they exceed the initially agreed-upon Pool of Funds value.

Unused Value of the Pool of Funds Credit:

  • Implications: The remaining funds are forfeited if the agreement expires and the total value is not used.
  • No Refunds: There are no credits or refunds for the unused value of the Pool of Funds Credit.

Adding Software Programs to the Agreement:

  • Restrictions: Once the agreement is in place, adding new software programs typically requires additional payment for licenses and technical support.
  • Additional Costs: Organizations must pay for these new licenses and support fees to include additional software programs in the PoF agreement.

By understanding these aspects, organizations can better navigate the complexities of the Oracle Pool of Funds License Agreement, ensuring compliance and optimizing their Oracle software usage.

FAQ: Oracle Pool of Funds

What is the Oracle Pool of Funds?

The Oracle Pool of Funds (PoF) is a flexible licensing agreement that allows customers to pre-purchase a specific amount of Oracle software licenses over 2-3 years.

Who should consider using the Oracle Pool of Funds?

Companies experiencing growth in Oracle software products, with an uncertain product mix, or those looking to avoid committing to an Oracle ULA.

How does the Oracle Pool of Funds work?

Customers buy a predetermined number of licenses, which are pooled together. These licenses can then be deployed across various servers or devices as needed.

What are the benefits of the Oracle Pool of Funds?

High discount rates on licenses and flexibility in choosing products.

What are the main drawbacks of the Oracle Pool of Funds?

All products belong to one Customer Support Identifier (CSI) and are subject to Oracle’s repricing rule. There are also restrictions on terminating other support contracts.

How are the licenses priced under the Pool of Funds?

Licenses are discounted, and the total cost is calculated based on the overall pool of licenses rather than individual purchases.

What is a Customer Support Identifier (CSI)?

A CSI is a unique identifier for a customer’s support contracts with Oracle, under which all purchased products are grouped.

Are there reporting requirements with the Oracle Pool of Funds?

Customers must submit regular reports detailing the number of active licenses and the servers or devices on which the software is installed.

What happens if I don’t use all the licenses in the Pool of Funds?

Unused licenses are forfeited at the end of the agreement period, and there are no credits or refunds for the unused value.

Can I add new software programs to the Pool of Funds agreement?

Typically, adding new software programs requires additional payments for licenses and technical support fees.

What are annual technical support fees?

These are fees calculated based on the total value of the Pool of Funds agreement, payable annually, even if no software is deployed initially.

What happens if I fail to maintain the Total Support Stream?

Failure to maintain the Total Support Stream can result in the immediate termination of the Pool of Funds period and require the submission of a License Declaration Report.

What is a License Declaration Report?

It is a report that outlines the deployment of software programs, detailing the types and number of licenses used and ensuring compliance with the agreement.

What occurs when the Oracle Pool of Funds agreement expires?

You must submit a final License Declaration Report, declare all software licenses acquired, and purchase additional licenses if the pool value is used up before expiration.

Can I terminate other support contracts during the Pool of Funds period?

No, the PoF agreement includes clauses that prevent customers from terminating other support contracts that include products covered by the PoF.


  • 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.

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