What Is Oracle ESL License -Oracle Embedded Software License?

The Oracle ESL License (Oracle Embedded Software License)

• A highly restrictive license for Independent Software Vendors (ISVs) embedding Oracle software in their applications.
• ISVs can package and resell the license with their solutions or applications.
• Usage is strictly limited to the specific application package and prohibits direct user access to Oracle programs.
• Offers two license models: standard Oracle licensing metrics with a 90% discount or a royalty-based model.
• Oracle ESL licenses are excluded from Oracle end-customer audits, focusing on the ISV instead.

Oracle ESL (Embedded Software License) is designed for Independent Software Vendors (ISVs) who integrate Oracle components into their software solutions.

What is an Oracle Embedded License?

An Oracle Embedded Software License (ESL) is a highly restrictive license that allows ISVs to package and resell Oracle software as part of their solution. This license type is intended for applications with embedded Oracle technology and cannot be accessed or used separately by the end customer.

To become eligible to resell Oracle ESL licenses, the ISV must become an Oracle Partner. The most common product embedded under ESL licenses is the Oracle Database, which has various database options and middleware products like Oracle Java and Oracle Weblogic Server.

An Oracle ESL (Embedded Software License) is a highly restrictive type of Oracle license that can be packaged and resold by Oracle ISVs along with their application or solution.

The company developing and owning the IP embedding Oracle must become an Oracle Partner to become eligible to resell Oracle ESL.

The most common embedded product is the Oracle database and database options. Oracle provides the ISV with a 90% discount from the Oracle technology price list, which reflects the restrictive nature of the Oracle ESL license model.

A notable difference between Oracle ESL, Oracle Full Use, and Oracle ASFU is that Oracle technical support is not required for Oracle ESL licenses.

Key Features of Oracle ESL License

• Royalty-Based Model: In this model, Oracle takes a percentage (usually 10%) of the ISV’s price list revenue, and the ISV does not need to count users or processors.
• Intended Use: Oracle ESL licenses can only be used within the ISV’s application. The end customer cannot use them as standalone Oracle products.
• High Discount: ISVs receive a 90% discount from Oracle’s technology price list, reflecting the restrictions imposed on ESL licenses.
• No Technical Support Required: ESL licenses do not require technical support, unlike other Oracle licenses. Most ISVs do not maintain Oracle support for embedded licenses.
• License Models Available: Two primary licensing models are available for ESL licenses:
• Standard Oracle Licensing Metrics includes metrics like Named User Plus or Processor.

Which products can be sold/used with an embedded license?

• Oracle Database
• Oracle Middleware, such as Weblogic Server.
• Oracle Java

Oracle ESL license restrictions

Oracle’s Embedded Software License (ESL) has strict usage restrictions that organizations must follow to maintain compliance.

Below is an overview of these limitations:

Restricted Usage: Oracle ESL licenses can only be used for the specific application described in the APRF agreement between Oracle and the ISV. They cannot be utilized for any other third-party applications or solutions.

Installation Requirements: The Oracle database must be integral to the ISV’s application and operate without any user configuration. The database cannot be installed independently or customized outside the ISV’s solution.

Limited Access for End Users: While the end user technically owns the license, they cannot directly access or manage the Oracle software. All management tasks must be done exclusively through the ISV’s application interface.

Prohibition on Modifications: End users are restricted from making modifications, such as patches, upgrades, or creating new users or database objects, in the embedded Oracle database. This ensures that the database remains in the state intended by the ISV.

Administrative Control: All administrative tasks, such as starting up, shutting down, or performing backups, must be conducted through the ISV application. End users do not have the authority to perform these tasks independently.

Exclusive Access: Third-party tools or applications cannot directly access the embedded database. Interaction with the database must occur via APIs provided by the ISV, ensuring that the ISV retains control over database interactions.

SAM Tool Restrictions: Software Asset Management (SAM) tools cannot be used to manage the Oracle ESL license. This restriction prevents any unauthorized or unintended use of the database.

No Conversion in ULA: If an organization enters into an Oracle Unlimited License Agreement (ULA), Oracle ESL licenses cannot be converted to be included under the new support contract. ESL licenses remain separate from any broader licensing arrangements.

ISV Access for Maintenance Only: The ISV retains the right to access Oracle-embedded programs solely for technical maintenance. The ISV ensures that the database functions as intended, with no additional modifications allowed.

No Upgrade Path: There is no available path to upgrade the Oracle ESL license to an Application Specific Full Use (ASFU) or full-use license. Organizations must continue using the ESL license under the original restrictions or consider acquiring a new license for expanded capabilities.

Benefits of Oracle ESL Licensing

Oracle ESL licensing comes with specific advantages for ISVs that want to integrate Oracle technology into their products:

• Cost Savings: Oracle’s substantial discount helps ISVs reduce costs while integrating powerful Oracle technology into their solutions.
• Simplified Sales: By embedding Oracle software directly, ISVs can provide their customers with a complete package, simplifying the sales process and enhancing the value of their solution.
• Royalty-Based Flexibility: The royalty-based licensing model eliminates the need to track processors or users, making it simpler for ISVs who want to avoid the complexity of standard licensing metrics.

Example Use Cases

To better understand how Oracle ESL licenses work, consider these two examples:

1. Healthcare Application with Embedded Database:
   • An ISV develops a healthcare management system that uses the Oracle Database to store patient records and transaction data.
   • The database is embedded within the application, and end-users access patient information through the ISV’s software interface without direct access to the Oracle Database.
2. E-Commerce Platform with Middleware Integration:
   • An ISV creates an e-commerce solution and uses Oracle Weblogic Server to manage business logic and server requests.
   • The Weblogic Server is embedded so that users interact only with the ISV’s platform, and the ISV manages all server configurations.

Differences Between Oracle ESL, ASFU, and Full Use Licenses

• Oracle ESL (Embedded Software License): Only usable within the ISV’s specific application, with no user access or ability to modify the database. Offers a high discount and no technical support requirements.
• Oracle ASFU (Application-Specific Full Use) allows the software to be used with a specific application but gives more flexibility than ESL. End customers have some access rights, and technical support is required.
• Oracle Full Use License: The least restrictive, allowing full usage of Oracle software in any environment, with full technical support and user access rights.

Oracle Embedded License – APRF FORM

The Oracle Embedded License agreement, represented by the APRF Form, is a standard document that companies sign with Oracle to obtain the rights to distribute Oracle software alongside their software packages.

This agreement is of limited relevance to end customers since they are not directly responsible for license compliance regarding the Embedded Software License (ESL) deployment with Oracle.

For Independent Software Vendors (ISVs) entering into embedded licensing agreements, it is recommended that the licensing terms be broad and excessive detail avoided. This approach provides flexibility, making adapting and updating the application package easier without renegotiating the licensing agreement for minor changes.

Oracle License Management and License Audits

• Audit Responsibility: Oracle ESL licenses are exempt from end-customer license audits conducted by Oracle. Instead, Oracle retains the right to audit the ISV that has resold the ESL license.
• Compliance Responsibility: End customers are not responsible for ensuring compliance with Oracle ESL licenses.
• Software Asset Management (SAM) Tools: SAM tools cannot manage Oracle-embedded programs.
• Virtualization Guidelines: Licensing for Oracle-embedded software must adhere to Oracle’s guidelines concerning virtualization technologies, such as VMware. However, if your license uses a royalty-based model, it may help alleviate some of the challenges associated with virtualization licensing.

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