Key Points on Oracle Support Cost Reduction
- Up to 50% Savings: Cut Oracle support fees in half.
- Tailored Support: Pay only for what you need.
- Extended Legacy Support: Support for older versions Oracle no longer supports.
- Customized Service: Flexible, responsive, and aligned with your needs.
Oracle Support Cost Reduction with Third-Party Support
Oracle support costs can significantly burden many businesses, often consuming large portions of the IT budget.
Organizations reliant on Oracle’s ecosystem—such as its database management systems, ERP solutions, or middleware—can be locked into high support fees, limiting their ability to invest in new technology or other strategic initiatives. Third-party support is a viable alternative that is gaining traction.
This article explores how companies can reduce Oracle support costs through third-party providers like Spinnaker Support or Rimini Street. We’ll examine the benefits, challenges, and practical examples of successful transitions.
Third-Party Support: An Overview
Third-party support services offer a compelling alternative to Oracle’s direct support. Providers such as Spinnaker Support and Rimini Street provide comprehensive support services for Oracle products at a much lower price than Oracle’s standard rates. Businesses can save up to 50% or more by moving to third-party support providers.
These companies offer support that includes the same essential services—like bug fixes, troubleshooting, and tax or regulatory updates—often with more personalized attention.
The key difference is that they are independent from Oracle, which means they do not have access to Oracle’s proprietary updates or new patches, which can lead to certain trade-offs.
Potential Savings with Third-Party Support
The primary motivation for most companies considering a switch to third-party support is cost savings. By transitioning from Oracle to a third-party provider, companies can reduce their support fees substantially, with savings typically ranging from 50% to 70% of Oracle’s standard support costs.
- Tailored Support Plans: Unlike Oracle’s rigid, standardized pricing structure, third-party providers can offer tailored support plans that match a company’s needs. This means businesses pay only for what they require, which leads to further cost optimization.
- Mid-Sized Manufacturing Example: Take the example of a mid-sized manufacturing company that faced mounting Oracle support fees. By switching to Rimini Street, they saved over $500,000 annually, funds reinvested in upgrading their IT infrastructure. This led to improved productivity and better operational efficiency.
Benefits of Third-Party Support
Moving to third-party support has several benefits beyond just cost savings. Below are some of the most important advantages of making this switch:
1. Significant Cost Savings
The immediate cost reduction is the most obvious benefit of moving to a third-party support provider. Oracle’s support costs tend to increase over time, often without significant improvements in the service offering. Third-party providers like Spinnaker Support and Rimini Street can often provide the same level of support for half the price—or even less.
- Real-World Example: A mid-sized financial services firm cut its Oracle support costs by 60% after moving to Spinnaker Support, freeing up funds to implement advanced analytics tools.
2. Flexible and Customized Support
Third-party support providers are more flexible than Oracle. Instead of a one-size-fits-all model, they work with companies to provide customized support that aligns more closely with the business’s specific needs. This means companies are not paying for unnecessary services they do not use.
- Tailored Plans: Many third-party providers allow organizations to select only the needed services, such as regulatory compliance updates, bug fixes, or 24/7 support for mission-critical systems.
3. Extended Support for Older Versions
Oracle has a fixed support lifecycle, which means that after a certain period, older versions of software move to limited or no support. Third-party providers, however, offer extended support for older versions of Oracle software that Oracle no longer supports.
- Support Beyond End-of-Life: Companies running older versions of Oracle products—such as Oracle EBS or JD Edwards—can continue receiving the same technical support even after Oracle’s official support period ends. This allows companies to continue using legacy systems without being pressured into costly upgrades.
Read about how to to terminate unused licenses and reduce Oracle support.
Drawbacks of Moving to Third-Party Support
While the advantages of moving to a third-party support provider are compelling, it is also important to understand the drawbacks. Knowing both sides of the story is essential for making an informed decision.
1. Loss of Access to Oracle Patches and Updates
One of the biggest downsides of leaving Oracle’s direct support is losing access to its patches and updates. These include security patches and feature updates that Oracle rolls out to its supported versions.
- Security Considerations: Without Oracle’s security patches, businesses may be more vulnerable. Third-party providers often provide security services but cannot access Oracle’s proprietary updates, which may leave gaps.
2. Complex Upgrades
Without Oracle’s direct support, upgrading to newer versions of Oracle software can become more complex. Upgrades may require additional testing, workarounds, and custom configurations, which can increase costs and effort.
- Planning Required: Moving to a third-party support model requires careful planning for upgrades. Many companies have found that additional support from consultants or in-house resources is necessary to perform these upgrades.
3. Contractual Lock-In Considerations
Once a company leaves Oracle’s support, it may face challenges re-entering the Company’s official support ecosystem. Reinstating support with Oracle can be prohibitively expensive, sometimes requiring payment of backdated support fees.
Choosing a Third-Party Support Provider
Selecting the right third-party support provider is critical. Not all providers are equal, and the support quality can vary significantly between companies. Here are some factors to consider when choosing a third-party support provider:
1. Industry Experience
Select a provider with proven experience in supporting Oracle products. Providers like Rimini Street and Spinnaker Support have years of experience working with Oracle environments and a deep understanding of Oracle’s ecosystem.
2. Range of Services
Make sure the provider offers a comprehensive range of services that match your needs. This includes general technical support, tax and regulatory updates, custom patches, and advisory services.
- Personalized Account Management: Providers that offer dedicated account management and 24/7 support for mission-critical systems can often provide a better experience than Oracle’s tiered support structure.
3. Client Testimonials and Case Studies
Look for client testimonials and case studies to gauge other customers’ satisfaction with the support provided. Providers with a history of successful Oracle support transitions can give you confidence that they will meet your requirements effectively.
Case Study: Transitioning to Third-Party Support
Background: A large pharmaceutical company struggled with escalating Oracle support costs that restricted its R&D and IT modernization project budget.
Challenge: Oracle’s annual support fees had grown significantly, representing a major expense without significant improvements to support quality. The company was also using older versions of Oracle EBS, approaching Oracle’s end-of-support lifecycle.
Solution: The company decided to transition to Rimini Street. By switching, they reduced their annual support costs by 55%, saving $1.2 million annually. Rimini Street provided continued support for its legacy Oracle systems, allowing the company to allocate savings towards critical R&D initiatives.
Outcome: The company experienced a seamless transition, maintained stable operations, and used the funds saved for technology innovation, ultimately gaining a competitive advantage.
When Third-Party Support Is the Right Choice
Not every organization will benefit from switching to third-party support; the decision should be made carefully.
Here are some scenarios where third-party support makes sense:
- Stable Oracle Environments: If your Oracle environment is stable and you don’t plan on upgrading frequently, third-party support could be a great option, as you will no longer need Oracle’s updates.
- Budget Constraints: Organizations seeking to reduce costs and allocate funds to innovation or modernization projects may find third-party support an effective cost-reduction strategy.
- Extended Legacy System Usage: Companies that need to continue using an older version of Oracle software may benefit from the extended support offered by third-party providers after Oracle’s official support ends.
- Customization and Flexibility: If Oracle’s support isn’t meeting your needs and you require more customized support, a third-party provider can offer services tailored to your organization’s requirements.
Tips for Transitioning to Third-Party Support
If you decide that third-party support is right for your organization, here are some tips to ensure a smooth transition:
1. Evaluate All Licensing Contracts
Carefully review your existing Oracle contracts. Understand the implications of leaving Oracle’s support and whether any penalties or additional charges may apply.
2. Select the Right Provider
Choose a reputable third-party provider with significant Oracle expertise. Providers like Rimini Street or Spinnaker Support have the experience and knowledge needed for a smooth transition.
3. Prepare Your Team
Ensure your IT and support teams understand the changes and how they will interact with the new support provider. This will help minimize disruptions during the transition period.
Frequently Asked Questions (FAQs)
What are the cost benefits of switching to third-party support? Third-party support can save up to 50% or more on Oracle support fees compared to Oracle’s standard pricing. Providers like Rimini Street and Spinnaker Support offer more cost-effective support services.
Is the quality of support provided by third-party vendors comparable to Oracle? Yes, third-party vendors provide comparable, if not better, support by offering personalized service, dedicated account managers, and round-the-clock support for critical systems.
Do third-party providers support older Oracle versions? One of the significant advantages of third-party support is that it continues to provide comprehensive support for older Oracle versions that Oracle may no longer support, giving companies the flexibility to stay on a version longer.
What are the drawbacks of switching from Oracle support? The primary drawback is losing access to Oracle’s official patches, updates, and new features. Businesses need to assess whether they can maintain their systems without these updates.
Can switching to third-party support help with IT budgeting? Yes, it provides predictable and often lower support costs, freeing up a portion of the IT budget to invest in other modernization or growth initiatives.
How do third-party providers handle security patches? Third-party vendors create custom security patches to ensure system security. Although these are not Oracle-provided patches, the providers develop and test patches to fill the same security gaps.
Is there a risk of compliance issues when using third-party support? Oracle may consider using third-party support a violation of their licensing terms if not done correctly. It’s essential to review contract terms thoroughly and ensure compliance before switching.
What kinds of support do third-party vendors offer? Third-party vendors provide bug fixes, issue resolution, regulatory and tax updates, and 24/7 support for critical systems, often tailoring their services to meet the client’s needs.
Can I still upgrade Oracle software using third-party support? Upgrading Oracle software without Oracle’s direct support can be more complex and may require additional planning or outside consultants. However, upgrades are still possible with careful consideration.
Are there any examples of successful third-party support transitions? For example, a mid-sized manufacturing company moved to Rimini Street and saved $500,000 annually, which it reinvested in IT infrastructure upgrades, improving productivity.
What factors should I consider before switching to third-party support? Before switching, consider your current support needs, system stability, Oracle software versions in use, compliance requirements, and long-term upgrade strategy.
How do third-party vendors ensure round-the-clock support? Many provide 24/7 support through dedicated account managers and technical experts who can resolve critical issues and keep systems running smoothly.
Will Oracle support me if I choose to return after using third-party support? Oracle may allow you to return to their support services, but they may require payment of backdated support fees for the period during which third-party support was used. This can be costly.
How can I evaluate whether a third-party provider is suitable for my needs? Before switching, check the provider’s experience supporting Oracle products, range of services, client testimonials, and industry-specific expertise. Make sure they align with your requirements.
Is third-party support recommended for mission-critical Oracle environments? Yes, but it requires careful planning. Third-party vendors like Spinnaker Support and Rimini Street have experience handling mission-critical systems, providing robust, customized support for these environments.
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