If you are running Oracle on VMware and you are audited by Oracle, your alarm bells should go off immediately. If the Oracle audit has not begun yet, you have plenty of options for how to manage the Oracle license audit. But if you are reading this and you already have the audit report, your options are very different. Oracle have made billions of dollars on auditing Oracle customers running Oracle on VMWare claiming customers need to license servers not running any Oracle software. Oracle licensing in VMware is one of the most controversial IT topics around. It has not been resolved and companies have for the past 15 years been struggling with Oracle licensing in VMware in audits. This article will explain what is Oracle position when you need to license Oracle technology in VMware. Oracle contractual position is weak and their position is not found in their licensing agreements.
When we worked at Oracle
We used to work at Oracle and this topic was used purely as a way of driving up the initial licensing gap price to get as much money as possible from the customers during Oracle license audits. Also, at Oracle there is no effort on educating its customers about licensing especially when it comes to this topic. Perhaps a kind reader can point us to a website where Oracle educates its customers about how to license Oracle when it comes to soft partitioning?
If Oracle wanted to create stronger licensing contracts or policies, this should have been done years ago. Then customers would not have any wiggle room and would simply have to pay up. But this never happened, Oracle licensing agreements are not referencing virtualization policies or the soft partitioning document.
We remember the days while still working at Oracle. vSphere 6.0 was released and there were wide discussions at my local Oracle office about implications for customers. It seemed so outrageous we decided not to talk about the change with our customers. At least the people I worked with always knew that if a customer was caught non-compliant due to the virtualisation, we never expected them to pay the full amount.
Usually, we considered it a success if the customer paid 10% of the initial findings for this license gap. We would of course always try to play the game: “you need to pay for all processors” and send some “nice e-mails” to customers who were under audit.
Oracle licensing on VMware is a challenge
Then I switched sides in 2015 and joined the good side “service providers” where I was tasked to help and explain Oracle licensing and contracts to both small and large customers. I realized that everyone struggled with how to license Oracle on VMWare. Everyone from the Fortune 500 companies with 100,000+ employees and large software asset management teams to the small companies with only a few servers.
I would get asked at almost every call or event “what is really the solution to Oracle licensing when it comes to deploying with virtualization technologies, specifically VMware?”
The answer to that is that:
There is no magic solution to it, if you approach an Oracle licensing expert, they often have different answers.
What you need to do is read your contract and policies and make up your own mind about what you think is right. You either pay money to Oracle or you don’t. If you approach Oracle the solution is #2 below or sign a ULA. Here is why it is good to work with an independent Oracle licensing expert who can advise you on this topic.
There are different strategies for Oracle licensing and VMware, so I will share some of what our clients are choosing and what I hear other Oracle licensing experts talk about.
6 Most common solutions to Oracle Licensing and VMware
If you currently working at a company responsible for Oracle licensing and working with VMware.
Oracle licensing is calculated based upon the hardware that you are running the technology software on. Enterprise Edition products is core-based calculation and standard edition you license occupied CPU sockets.
Oracle licensing in virtual environments
Oracle has published a document “partitioning policy document” that lays out which virtualization technologies you are allowed to limit the CPUs that you need to license when deploying Oracle. Read our blog Oracle partitioning policy – How to fight back – Watch the video below when we review the contracts together.
Oracle licensing VMware
To understand Oracle licensing position when using VMware, we must understand that VMware uses a technology named vmotion to move virtual machines within a cluster of servers, within a vCenter and across vCenters. VMware technology has improved over the years and Oracle has different licensing views depending on what version VMware you use.
Oracle licensing VMware 5.1 to 5.5
Virtual machines can migrate within the same vCenter, therefore Oracle’s view is that you need to license all physical hosts within that specific vCenter. This applies even if they are not using the same storage.
Oracle licensing VMware 6.0
Virtual machines can cross vCenter borders and therefore Oracle’s view is that you need to license all physical hosts in all your VMware environments.
Oracle licensing VMware and the network and storage isolation amendment
Oracle has in the last few years started to offer Oracle customers who wants to run on VMware a network and storage segregation amendment where you need to perform technical restrictions that prevents the Oracle licensed machines to migrate to different hosts. This is an negotiation betwen you and Oracle. The end result is then documented and put into an Oracle licensing amendment.
Oracle on VMware – actions to take before the Oracle audit
Options for Oracle licensing for VMware
Oracle on VMware – actions to take at the end of the audit.
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If you are audited by Oracle, and Oracle claims you need to license all physical hosts for in your VMware environments including hosts that that you are not using for Oracle, contact us. We will be part of your team to aggressively fight Oracle’s claims. Oracle licensing on VMware is managable if you can build the right strategy for counter Oracles arguments.