by Evan Boyd, VP of Business Development
With inflation continuing to skyrocket and a shaky economic outlook, many companies are either starting to feel business softening or see it coming. From auto to banking to crypto to entertainment to healthcare to real estate to tech – the list goes on and on – news of cuts are coming from many industries daily.
On top of that come reports that Oracle plans to increase support fees in line with inflation. In recent years the uplift for support and maintenance increased from 3% to 4%, but now Oracle customers may see increases of 8% – and if you have hardware on support, that could translate to annual increases as high as 20%.
If you’re currently scouring P&Ls for places to trim while minimizing the impact on operations and employees, I’d caution you from breezing past your software expenses. More specifically, if you’re in an Oracle contract, here are three possible ways to achieve savings at this critical time:
Know precisely how you’re using your Oracle products. This means (1) find your benchmark pricing, (2) track your support usage, (3) look for items that were purchased but are no longer used, (4) know your renewal dates and (5) check your invoices for a breakdown of items that increase in price each year. You may be surprised by what you find. About 80% of the benchmarks we perform for clients turn up something that doesn’t compute.
Just recently I reviewed a client’s invoices and found support for a particular product was nearly 500% above list price. After a closer look, we found they had migrated processor licenses to Named User to satisfy an audit. Oracle had migrated some processor licenses onto a new order and charged the additional support for them, but never reduced the price for the quantity migrated. Four years later, Oracle owes them a refund of about $200,000.
Consider a move to third-party support for your Oracle products. Another option we help clients with is a move to third-party support for an average reduction of about 50%. Using Oracle to support its own products sounds like the most logical approach, but the truth is, its contracts are designed to lock you in, maximize your spending, and even open the door for audits and penalties. Our blog post, “6 things to know about Oracle’s tactics if you’re considering third-party support,” goes deep on this issue. In short, third-party support can be quite good and save your company big money. Oracle would have you believe there’s no path to third-party support – that’s just not accurate.
Are you using old versions of software and still being hit with annual support cost increases? Some older versions do not match up with the new ways of measuring processors. Some still do not even have support available, yet companies are still paying for it.
If you’re considering a new Oracle contract of any type or just want to get control of your current entitlements, get a no obligation review from the Original Oracle Licensing Experts. Contact us at info@slc.us.com or call (925) 961-9741.
