Oracle license review – Best practices in 2022

Oracle License Review is when an Oracle end customer decides to review its Oracle software licenses to understand if they are correctly licensed or not. This license review is normally done without involvement from the vendor. By conducting the license review independently of the audit, it provides you with more options on how to remediate any licensing gaps. It also setups the negotiation position better, because if you approach Oracle and wants to buy licenses because you have a shortfall – you will recieve less discounts than you would otherwise recieve if you negotiate from a different scenario. The right way to conduct an Oracle license review is to use Oracle experts, going to a generalist firm will never obtain the results that are necessary for Oracle. If you calculate a 5% incorrect, that usually means millions of licensing risks. This is why you should work with known experts in Oracle licensing.


Oracle License Review – 5 steps to take


Oracle Contract Compliance – Step 1


Get a copy of your Oracle contracts


Why: You should before any other step understand what licenses you own and which license metrics that you have. Often the licensing definition is only explained in your Oracle Contracts. You may search online for a definition, but these have shifted over time and Oracle may also have given you a unique licensing metric. Therefore, do not simply google and read about the licensing definition that you see in your annual support renewal. Start by reviewing your contract. Depending on which licensing metric you have you can decide on how to measure your licensing. For example, some customers have a license metric which is based your company annual revenue or number of employees. Then you do not often need to count the number of processors on each server running Oracle.

The basics can be covered on the video below



Recommendation: If you do not have a digital or hard copy of the Oracle Ordering Documents, request them from Oracle.


Oracle licensing in virtual environments – Step 2


Have you deployed Oracle Technology (non applications) in virtualized environments?

Oracle licensing policies are not suited for deploying their software in many virtualized environments. If you are using VMware as a virtualization technology, you may end up in a world of trouble. Check out this video for a deep dive into how to license Oracle software in virtualized environments


How to license Oracle Software when deployed in VMware


Whenever I hear about any of our clients saying they have deployed Oracle Software in virtualized environments, its a red alert flag. It should be so for you too. Good news is that often you can remediate this quite easily, but if you wait for Oracle to find out it will often cost you millions.


Recommendation: Find out which virtualization technology that you use, understand Oracle licensing when using it and then evaluate your risk/options.


Oracle License Review – Database Step 3


If you are an Oracle Database customer, you need to review #2. If you are deploying Oracle on physical servers. This is a short step by step approach for reviewing licensing.


  1. Check your contract if you have processor or named user plus licensing.
  2. In your contract you can read which version of Oracle Database your company own if you have any “database options” licensing. Remember that options licensing requires Enterprise Edition licensing.


Enterprise edition licensing is licensed per core factor, Oracle calculates its licensing requirements based on the processor type. You can find Oracle Processor Core factor table here Enterprise Edition database is the only database in which you can use Oracle Enterprise Edition features, technically it is possible to use many of Enterprise Edition features on a standard edition. However, from a licensing perspective that is not allowed.


Standard Edition and Standard Edition 2 is licensed per occupied CPU Sockets. It has some limitations to what hardware you can deploy it on. Review it carefully as its quite common for companies to deploy Standard Edition Database versions on too powerful servers and suddenly you are outside of your limitations and need to license Enterprise Edition.


Once you know the basics, next step


3. Review the hardware that you have deployed Oracle Software upon, if you have CPU licensing for Enterprise Edition you need to apply the calculation you multiply number of cores x Oracle license factor = Oracle CPU Licenses required.


4. If you have a Named User Plus licensing you need to beware that Oracle that Oracle has a user minimum rule and that differs from each database version.




How to understand Oracle database options usage Step 4


Once you have reviewed the basics such as do, we have the right number of licenses to cover our usage. You need to understand what database features inside of the database have you used. You can find a list of Oracle Database Options and management packs by visiting this Oracle page


Now this can be virtually impossible for almost anyone to find out and imagine if you have hundreds of Oracle Databases. You need to review all this functionality, not only what is in use today but what has historically been used by your company IT and DBAs as there is often a “usage evidence” saved in the database. That is then picked up by Oracle audit tools, where seasoned Oracle DBAs had no idea that either a certain functionality required licensing or that their predecessor have used a licensable feature.


Recommendation: You should reach out to an Oracle expert who can analyse the results of what Oracle LMS scripts will tell you. That will tell you what is in use today, but crucially what has been used in the past. Then you take the required action to resolve the risk.


Review Oracle Licensing Policies Step 5

Remember Oracle requires you to license not only all production environments, but also all test and development and in many cases also disaster recovery environments. Oracle have published a document explaining the basic rules of licensing disaster recovery solutions, you can find this link here.


Oracle license review – what tools to use ? 


To achieve the best results of an Oracle license review, it is well known in the IT asset management industry that you should use the same tools / scripts that Oracle LMS (Audit org.) uses to audit their customers. You can replicate an Oracle license audit. Oracle customers are allowed to use the Oracle LMS scripts to measure your Oracle licenses.


Oracle license review process


  1. You run the Oracle LMS script on your servers running Oracle.
  2. You then provide the LMS script output to an Oracle licensing expert
    who can interpret the output and match it to Oracle licenses.
  3. Most analysis of LMS script takes 4-6 weeks to complete.
  4. It’s a 99% chance that you are out of compliance with your Oracle entitlements. Don’t worry 90%+ of that is not due to over-usage but simply mistakes in how you have deployed Oracle.
  5. When performing an internal software license audit under NDA, you have multiple options for how to remediate the financial risk.


Ex- Oracle LMS Auditors


The best Oracle licensing consultants are all ex-Oracle LMS. They worked at Oracle for several years and understand how Oracle interprets licensing policies. They know the weaknesses and strengths of Oracle license audits. They are also the best people to help you perform an Oracle license review.


It’s valuable for end customers who can draw on that expertise to assess the license compliance findings of the Oracle license review. The reason is Oracle licensing is not always black and white – there are many grey areas open for interpretation.




If the licensing firm have partnership agreements with Oracle, they are contractually bound to report sales opportunities to Oracle in quarterly sales meetings. Not every Oracle reseller or partner is sharing information with Oracle. However, if you want to be assured that the Oracle licensing advice you are given is in your best interest, find an independent Oracle licensing company as many Oracle customers have been burned by Oracle resellers sharing licensing review data with Oracle. Redress is staffed by ex-Oracle employees who have decades of experience auditing customers on Oracle behalf and are now using their knowledge and expertise to help customers to conduct Oracle license reviews.





If you would like to be updated on Oracle licensing and recieve more tips follow us on
social media:


✔️ Follow us on LinkedIn
✔️ Subscribe to our channel on YouTube


We are independent Oracle licensing experts providing management consulting services to companies worldwide. If you want to know more about our services, schedule an consultation to how we can help your organization with an Oracle license review.