Case Study – Oracle Licensing Assessment – MDF – Canadian SaaS provider– $3M Saved
Background
MDF is a Canadian independent software vendor (ISV) that embeds Oracle technology in its product. Its flagship software includes an Oracle Database component under a special embedded license agreement and also uses Oracle Java SE.
Because Oracle software is part of MDF’s product, proper licensing is critical – non-compliance could incur heavy costs and harm customer relationships.
Challenges
Oracle initiated a review of MDF’s embedded license and quickly claimed MDF might have exceeded its usage limits. Oracle auditors suspected MDF’s Oracle Database deployments surpassed what its embedded license allowed – using more database instances or users than permitted – and noted that MDF’s use of Java SE might now require paid subscriptions under Oracle’s new Java policy.
Oracle used these findings to pressure MDF into a costly contract expansion. They gave MDF an ultimatum: pay roughly $3 million for additional licenses and sign an expanded agreement, or face penalties and possible restrictions on its software distribution.
Accepting Oracle’s demands would result in approximately $3 million in new licensing costs – an expense that could lead to price hikes. Unwilling to agree without verification, MDF turned to Redress Compliance for an independent licensing assessment.
The goal was to verify usage, address any genuine compliance gaps, and negotiate a more favorable outcome than Oracle’s ultimatum.
How Redress Compliance Helped
Redress reviewed MDF’s Oracle usage. The team audited MDF’s embedded Oracle Database deployments and compared them to the limits in its embedded license contract.
The analysis showed Oracle’s claims were overstated; in many cases, MDF’s usage was within permitted limits that Oracle misinterpreted. Redress documented these discrepancies and presented evidence that substantially eliminated the alleged shortfall.
Next, Redress assessed MDF’s Java SE usage. They identified where Oracle’s Java was bundled in MDF’s software and how Java was used internally, then determined if a paid subscription was required.
Often, MDF could replace Oracle Java with open-source OpenJDK or other entitlements that already cover the usage. Redress guided MDF’s developers in repackage parts of the product with OpenJDK, thereby removing the Oracle Java dependencies.
For the few remaining Oracle Java users, they calculated the minimum Java SE subscriptions required.
Throughout the engagement, Redress handled communications with Oracle, presenting a detailed breakdown of MDF’s usage versus entitlements backed by contractual and technical proof.
Confronted with these facts, Oracle softened its stance, and Redress negotiated updates to MDF’s agreement that acknowledged the actual usage and drastically reduced Oracle’s license demands.
Outcome and Impact
With Redress’s help, MDF avoided roughly $3 million in costs, as Oracle’s initial compliance demand was reduced to a minor contract adjustment with no penalties. MDF didn’t have to sign the expensive new agreement; its original embedded license stayed in effect, clarified to prevent future disputes.
For Java, after Redress’s optimizations, MDF only required a few Java SE subscriptions for specific components, rather than the blanket coverage Oracle had initially sought. It also protected MDF from sudden price hikes.
The company now understands its Oracle license boundaries and has better tracking to ensure embedded databases stay within limits. With Redress’s guidance, the development team shifted much of its Java usage to OpenJDK, reducing reliance on Oracle. MDF preserved its partnership without overpaying.
Client Testimonial
CEO, MDF: “As an ISV, we walk a fine line with Oracle licensing – one misstep could cost us millions or disrupt our service. When Oracle’s audit required us to expand our agreement, we turned to Redress Compliance. Their knowledge of Oracle’s embedded licensing and Java rules was outstanding.
Redress showed we were actually compliant where Oracle claimed we weren’t, and they helped us make minor adjustments to align with our contract.
We avoided $3 million in costs and maintained stable pricing. Redress’s independent expertise and support were invaluable – we defended our position and maintained our Oracle partnership without overpaying.”
Call-to-Action
ISVs embedding Oracle technology should not leave compliance to chance. Contact Redress Compliance for an Oracle Licensing Assessment to ensure your usage aligns with contract terms and avoid unnecessary costs. Our experts will help you navigate Oracle’s complex licensing for embedded software and Java, so you can focus on your product instead of audit worries.
Further:
- Read about other Oracle Licensing Assessment Case Studies.
- Read more about our Oracle License Management Services.
