Negotiating Oracle software licenses can be a complex task. However, with a structured approach and a clear understanding of your organization’s needs, you can secure a contract that offers value and flexibility.
Here’s a comprehensive checklist to guide you through building your terms and conditions (T&Cs) for Oracle software contracts.
- 1. Define the Customer
- 2. Specify the Territory
- 3. Negotiate Technical Support Terms
- 4. Discuss Customized Licensing
- 5. Review Audit Clauses
- 6. Consider Extended Support
- 7. Include Company-Specific Needs
- 8. Include Subsidiaries
- 9. Review Risky Clauses
- 10. Negotiate a New License Agreement
- 11. Ensure Fair Pricing and Benchmarking
1. Define the Customer
Ensure that the ‘Customer Definition’ in the contract accurately represents your organization. This definition should include all the legal entities using the Oracle software.
2. Specify the Territory
Clearly define the ‘Territory’ in which the software will be used. If your organization operates globally, consider negotiating for worldwide usage rights.
3. Negotiate Technical Support Terms
Discuss and agree on the terms for ‘Technical Support’. This includes the level of support provided, response times, and any caps on future price increases.
4. Discuss Customized Licensing
Discuss ‘Customized Licensing’ options with Oracle if your organization has specific needs. This could include licensing for production, testing, disaster recovery, and archiving purposes.
5. Review Audit Clauses
Carefully review the ‘Audit Clauses’ in the contract. Understand how often audits can occur and the process involved. If possible, negotiate terms that minimize disruption to your organization.
6. Consider Extended Support
If your organization plans to use the software for a long period, consider negotiating for ‘Extended Support’. Be aware of additional costs and try to avoid or limit support price increases.
7. Include Company-Specific Needs
Include any ‘Company-Specific’ needs in the contract. This could be anything particularly important to your organization and its use of the Oracle software.
8. Include Subsidiaries
If your organization has subsidiaries, ensure they are included in the contract. If a subsidiary owns more than 50% of the company, they should be included in the ‘Customer Definition’.
9. Review Risky Clauses
Review the contract for any ‘Risky Clauses’. These are terms that could potentially cause issues for your organization in the future. If any risky clauses are identified, discuss them with Oracle and negotiate for their removal or modification.
10. Negotiate a New License Agreement
If the existing contract doesn’t meet your needs, consider negotiating a ‘New License Agreement’ with Oracle. This allows you to create a contract tailored to your organization’s needs.
11. Ensure Fair Pricing and Benchmarking
Finally, ensure that the pricing in the contract is fair and competitive. Use ‘Benchmarking’ to compare Oracle’s pricing with other vendors and negotiate for the best possible deal.
Following this checklist ensures that your Oracle software contract is optimized for your organization’s needs, providing the best value and flexibility.