Third-Party Support for Oracle Middleware and Apps
CIOs at global enterprises are exploring third-party support for Oracle middleware and applications to cut costs and gain flexibility.
This executive overview outlines how independent support providers can reduce maintenance fees by around 50%, extend the life of stable Oracle systems, and deliver more personalized service – all while highlighting the risks and best practices to consider before making the switch.
Why Enterprises Are Considering Third-Party Support
Many enterprises pay annual Oracle support fees of approximately 22% of the license value and face pressure to upgrade their software just to remain fully supported.
This has prompted CIOs to consider third-party support for Oracle middleware and apps as an alternative. Independent providers offer a way to escape Oracle’s cycle of rising maintenance fees and forced upgrades.
The appeal is straightforward: significantly lower costs and a support model aligned with the customer’s priorities.
The third-party support market has also matured – analysts project it to surpass $1 billion in the next few years, and many Fortune 500 firms have already made the switch.
Key Benefits of Third-Party Oracle Support
Third-party support providers promise not only cost savings but also improved service coverage.
Key benefits include:
- Dramatic Cost Savings: Companies typically save around 50% on annual Oracle support fees by switching to an independent provider. Oracle typically charges ~22% of the license cost per year for support, whereas third-party providers charge roughly half that. These savings free up a significant portion of the IT budget for innovation and other priorities. Avoiding Oracle’s frequent upgrades also provides indirect savings (deferring costly upgrade projects and hardware purchases).
- No Forced Upgrades & Extended Support: Third-party support allows businesses to run stable older versions of Oracle software for as long as needed. You can skip disruptive, costly upgrades and still receive full support on your current versions indefinitely. Providers will even support products long after Oracle’s official end-of-life dates, allowing you to maximize the ROI of systems that continue to meet your needs, rather than being forced into upgrades.
- Personalized Service: Independent support vendors often deliver more responsive, high-touch service. For example, Rimini Street (a leading provider) assigns senior engineers to your account and offers 24/7 support with fast response SLAs. Clients gain direct access to experts who understand their Oracle environment, eliminating the need to navigate Oracle’s tiered ticket system. Third-party support also typically covers areas Oracle won’t – such as assistance with custom code and interoperability issues, as well as ongoing tax and regulatory patches for Oracle applications.
Oracle vs. Third-Party Support – Key Differences
How does third-party support differ from Oracle’s support in practice? The table below compares a few critical aspects:
| Aspect | Oracle Support (Vendor) | Third-Party Support (Independent) |
|---|---|---|
| Annual Cost | ~22% of license value per year (with yearly increases) | ~50% of Oracle’s support fee (~11% of license value), with little to no annual increase. |
| Patches & Updates | Full Oracle patches, bug fixes, and security updates for supported versions (including new releases). | No new Oracle-supplied patches or upgrades. Provider delivers its own fixes, security workarounds, and required regulatory updates for your current version. |
| Support Duration | Limited by Oracle’s lifecycle policy (e.g. ~5 years Premier, then limited Extended support, then no new fixes under Sustaining). | Indefinite support for your existing software – no forced end-of-life dates. Support continues as long as you need it on your current versions. |
| Upgrade Rights | Included with active Oracle support (you may upgrade to newer versions at no additional license cost). Often required to upgrade periodically to stay supported. | Not included – no rights to new Oracle versions unless you rejoin Oracle’s support program or buy new licenses. You can avoid upgrades until it aligns with your business strategy. |
| Service Model | Global Oracle helpdesk with multi-tier escalation. Responses can be slower and stick to standard configurations (no support for custom modifications). | Dedicated engineers with deep Oracle expertise. Often faster response and resolution, with support that covers customizations and performance issues outside the standard scope. |
| Contract Terms | 12-month auto-renewal is standard. Must keep support on all licenses (“matching service levels”) or face penalties if some licenses are dropped. | More flexible contracts. You choose which products to support with the third-party. No Oracle penalties as long as you terminate support for a product entirely (rather than partially dropping licenses). |
Third-Party Support Market and Key Providers
Third-party support has moved into the mainstream. Over 3,000 organizations worldwide (including many Fortune 500 companies) now use independent support for Oracle software.
The market is led by firms like Rimini Street (the largest provider) and Spinnaker Support. Adoption continues to grow as more IT leaders recognize third-party support as a viable, strategic option.
Knowing that numerous peers have successfully made the switch can give your stakeholders confidence that this path is proven in practice.
Risks and Challenges
There are important risks and trade-offs to weigh before switching away from Oracle’s support:
- Loss of Oracle Updates: Once you leave Oracle support, you stop receiving Oracle’s official patches, security updates, and new version releases. Third-party providers will still supply fixes and workarounds for your current software, but if a critical issue ever requires an Oracle-supplied patch or major upgrade, you could be exposed. Companies mitigate this by fully patching systems before the switch and relying on the third party’s security measures thereafter. Be aware that any future need to move to a new Oracle version would likely require re-enrolling in Oracle support (with substantial back fees) or purchasing new licenses.
- License Compliance: You remain obligated to follow Oracle’s license terms even without an active support contract, and Oracle can still audit your usage. It’s crucial to ensure you are fully compliant (accurate user counts, proper use of options, etc.) before and after the switch. Also, adhere to Oracle’s “matching support levels” rule – generally, you must terminate support for all licenses of a given product to avoid contractual penalties or repricing on any licenses left on Oracle support.
- Provider Reliability & Legal Concerns: Moving to a third-party vendor means relying on them for mission-critical support, so their reliability is paramount. Vet the provider’s financial stability, track record, and security practices. Also be aware of the legal backdrop: third-party support is lawful, but providers must avoid infringing Oracle’s intellectual property. Leading vendors have adjusted their processes after past lawsuits (such as Oracle’s case against Rimini Street) to ensure they operate within legal boundaries. Sticking with well-established providers with strong reputations significantly reduces the risk of service disruptions or legal issues.
Recommendations
- Conduct a Cost-Benefit Analysis: Quantify the expected savings from third-party support versus the value of Oracle updates you’d forgo. Develop a comprehensive business case to justify the proposed change.
- Patch and Document Before Leaving: Before ending Oracle support, apply all final patches and archive key Oracle documentation or knowledge articles. This ensures you start with a fully updated system and have reference materials for the future.
- Ensure License Compliance: Resolve any licensing gaps or ambiguities now. Consider conducting a self-audit or hiring a third-party license review before making the switch. Being fully compliant from day one will prevent audit troubles later.
- Engage Stakeholders Early: Involve your executive sponsors, application owners, and security teams in the decision-making process. Address concerns with facts, and share success stories of similar companies to build buy-in.
- Compare Providers and Negotiate Terms: Evaluate at least two third-party support vendors to assess their capabilities and pricing. Negotiate a flexible contract with clear service levels and an exit clause so you have options if the service doesn’t meet expectations.
- Start with a Pilot if Needed: If there’s internal uncertainty, consider moving a less critical system first as a pilot project. A successful pilot proves the concept and can pave the way for broader adoption.
- Plan for Ongoing Security: Collaborate with the provider to understand their approach to delivering security fixes and regulatory updates. Augment their efforts with strong internal security practices (network monitoring, strict access controls, etc.). Treat the third-party’s patches with the same rigor and testing as Oracle’s.
Checklist: 5 Actions to Take
- Identify Candidates: List which Oracle systems (applications or middleware) are stable and good candidates for third-party support – typically those with high support costs and minimal upcoming changes.
- Audit Your Licenses: Gather all Oracle license agreements and verify that your usage is fully compliant with the terms of these agreements. Inventory the current versions and patch levels of each system, and apply any final Oracle patches before the switch.
- Select a Provider: Solicit proposals from leading third-party support firms (e.g., Rimini Street, Spinnaker Support). Evaluate their experience with your Oracle products and check references from similar customers.
- Time the Switch: Plan the cutover to align with your Oracle support contract renewal date. Provide Oracle with formal notice of cancellation per your contract, ensuring you remove entire product suites (to comply with Oracle’s support policies).
- Monitor and Review: After transitioning, closely monitor support performance (response times, issue resolution quality). Hold regular review meetings with the provider to address any issues and confirm that they continue to meet the agreed-upon service levels.
Download Procurement Advisory Playbook: Transitioning from Oracle Support to Third‑Party Support.
💸 Realize Tangible Financial Benefits Beyond Just Cost Savings
- Save 50%+ annually on Oracle support fees — and avoid costly forced upgrades.
- Extend the life of stable systems without paying for software you don’t need.
- Understand the total cost reduction: license optimization + deferred hardware/software spend.
- Learn how third-party support frees up budget for innovation, not just maintenance.
FAQ
Q: Is third-party support for Oracle software legal?
A: Yes. If you are properly licensed for Oracle software, you can obtain support from a third party. Thousands of enterprises use third-party support. Just make sure you stay compliant with your license terms – using independent support is legal as long as the provider follows proper processes and doesn’t misuse Oracle’s intellectual property.
Q: How much money can we save with third-party support?
A: Most organizations save about 50% of their annual Oracle support fees. For example, if you pay $2 million per year to Oracle, a third-party provider might charge around $1 million for comparable support. You may also save on indirect costs by avoiding forced upgrades, which reduces related project and hardware expenses.
Q: What do we give up by leaving Oracle’s support?
A: Primarily, you give up automatic access to Oracle’s latest patches, updates, and new feature releases. Your software will remain on its current version. The third-party provider will support that version with their fixes and updates (including necessary tax and legal changes), but you won’t receive new features or enhancements from Oracle. Essentially, you trade ongoing Oracle updates for cost savings and extended support on your terms.
Q: Can we return to Oracle support later if needed?
A: Yes, but it can be expensive. Oracle typically requires you to pay for the lapsed years of support (plus penalties) if you want to reinstate coverage. In some cases, the back fees and penalties make rejoining almost as costly as buying new licenses. It’s important to factor this into your long-term plans and only move to third-party support for systems you’re comfortable keeping on their current versions for a while.
Q: How do third-party providers handle security fixes and regulatory updates?
A: Third-party vendors have teams that create custom patches, code fixes, and updates to address security and compliance needs. For example, they develop tax and legal updates for Oracle ERP modules and provide workarounds or “virtual patches” for known vulnerabilities. While they don’t have Oracle’s proprietary source code, they find ways to deliver equivalent fixes. It’s wise to apply the same testing and change management to these vendor-provided patches as you would to Oracle’s, and maintain strong overall security practices as an extra safeguard.
Read more about our Third Party Transition Service.
