Case Study – Oracle ULA Optimization Service – Oracle ULA Optimization Saves French Telecom Operator 30% on Renewal
This case focuses on a major telecommunications company in France that partnered with Redress Compliance to optimize an upcoming Oracle ULA renewal.
The client is one of France’s leading telecom operators, serving millions of mobile and internet customers. They have over 12,000 employees and annual revenues exceeding €8 billion.
The company’s IT infrastructure is extensive and relies on numerous Oracle products: Oracle Database (including RAC and various options) powers customer billing and network management systems, Oracle Siebel CRM manages customer relationships, and Oracle Middleware (WebLogic and SOA Suite) underpins many internal applications.
These were all consolidated under a three-year Oracle Unlimited License Agreement, which was now due for renewal.
Given the scale of its operations, the telecom firm’s ULA was a critical component of its IT vendor management.
The ULA enabled the unlimited deployment of the aforementioned Oracle products, which proved invaluable during a period of rapid subscriber growth and the rollout of 4G/5G networks.
As the initial term ended, the company was prepared to renew the ULA (they still needed the unlimited flexibility). Still, they sought Redress Compliance’s help to ensure the renewal was on favorable terms and not an overpriced deal pushed by Oracle.
Challenges
Even as a renewal (rather than exit) scenario, the telecom operator faced significant challenges:
- Sticker Shock: Oracle’s initial renewal proposal came in at an exceedingly high price. The proposed cost for another 3-year ULA was nearly 30% higher than the original, despite the client’s expectation that costs might stabilize or even drop. Oracle justified this by the increased value the client had derived (massive deployment growth) and included additional products in the scope (like some Oracle Cloud credits and Java licensing). The telecom firm’s finance team balked at the price tag, which would have a direct impact on their margins if accepted.
- Complex Environment to Measure: To negotiate effectively, the client needed a clear understanding of their current Oracle usage and future needs. However, the environment was extremely complex – comprising thousands of Oracle Database instances in high-availability clusters, a Siebel system integrated with numerous third-party applications, and so on. There was uncertainty on what level of usage a non-ULA scenario would equate to. Without that, it was hard to know if Oracle’s offer was truly overpriced or possibly reasonable.
- Audit Fears if Not Renewing: While the company intended to renew, they wanted the option to walk away if Oracle’s terms were unreasonable. However, Oracle’s sales team hinted that not renewing would trigger a license audit given the scale of deployment (and indeed, a telecom with such broad Oracle usage would be an audit target). This implied threat hung over the negotiation – the client felt pressure to renew to avoid compliance trouble, which could weaken their negotiating stance.
- New Products in Mix: Oracle was pushing to include some of its newer cloud-based offerings into the ULA, such as Oracle Autonomous Database on OCI and Oracle Analytics Cloud, even though the client had no immediate plans for them. These extras were a double-edged sword: they gave potential future value, but also could be seen as raising the price. The client wasn’t sure if these were genuinely beneficial or just “nice-to-haves” that padded Oracle’s deal.
- Public Sector Contracts and Compliance: As a telecom operator, the company had government clients and was required to adhere to strict data sovereignty and compliance rules. Moving anything to the cloud (as Oracle encouraged) was not trivial. They needed to ensure any ULA terms, especially involving cloud usage, did not inadvertently create compliance issues or obligations (for example, some Oracle cloud services might store data outside France, which could be problematic).
How Redress Compliance Helped
Redress Compliance was engaged early in the renewal planning process, giving them time to execute a comprehensive strategy to tackle these challenges:
- Baseline Assessment: Redress started by determining the baseline – what would the client’s Oracle license position look like if they were to certify out instead of renewing? This involved calculating the number of licenses (Database processors, Siebel user licenses, WebLogic cores, etc.) in use across the environment. Redress’s team, working with client engineers, used Oracle’s audit scripts and their tools to count and cross-verify usage. This established a clear picture: the telecom would theoretically need thousands of Database licenses and tens of thousands of Siebel user licenses if they existed. The notional cost of that (at list prices) was astronomical, which is why a ULA made sense – but it also armed Redress with a figure to challenge Oracle’s proposal.
- Value Analysis: With the baseline in hand, Redress performed a value analysis of Oracle’s renewal proposal. They broke down each component (core ULA coverage, new products, cloud credits). By comparing the baseline costs, Redress demonstrated to the client’s executives that Oracle’s high price had a large profit margin cushion. In other words, Oracle was charging a premium far above the theoretical cost of licenses the client needed. This analysis served as the foundation for pushing back against price increases.
- Negotiation Strategy: Redress crafted a negotiation strategy that included a credible Plan B – the client could walk away and survive on a fixed license pool if needed, though not ideal. Redress coached the client’s negotiation team on messaging: they would convey willingness to renew but only at a fair price, and subtly let Oracle know that they had the means to measure their usage and would consider alternatives (including legal audit defense if it came to that). Redress’s presence bolstered this stance; Oracle knew the client had expert backing.
- Trim the Fat: Redress advised the client to remove unnecessary items from the renewal. Specifically, if Oracle Cloud services were not immediately useful, they should not be bundled at full cost. The client, with Redress’s data, declined the Autonomous Database and Analytics Cloud additions in the ULA. This significantly reduced the proposed price. They agreed to retain a smaller portion of cloud credits, but with flexibility (excluding forced migration clauses). Redress negotiated terms that any cloud credits were optional to use and that lack of usage wouldn’t affect the on-prem ULA terms.
- Benchmarking and Price Justification: One of Redress’s contributions was sharing industry benchmarks. They provided data on ULA pricing from similar-scale deals (anonymized insights from past experiences). This gave the telecom firm leverage to counter Oracle’s price – for instance, showing that a 30% increase was not in line with market trends for a second-term ULA of similar scope. By citing these comparisons, Redress pressed Oracle to justify the cost. Ultimately, Oracle relented and reduced the price when it saw the client was well-informed and ready to push negotiations to the brink.
- Contract Safeguards: Following the agreement on the new ULA, Redress helped refine the contract. They ensured that the renewal included clear language on what happens at the next expiration (no automatic price uptick, a defined option to certify out). They also inserted a clause that the inclusion of Java (if any) was covered, to prevent Oracle from later separating Java licensing (a tactic Oracle had started employing in recent years). In essence, Redress ensured the new ULA was airtight and didn’t contain hidden traps.
Outcome and Impact
The telecom operator achieved a significantly improved outcome with Redress Compliance’s support:
- Cost Reduction: The final ULA renewal deal was approximately 30% lower than Oracle’s initial quote. Over the 3-year term, this translated to around €10 million in savings. The final price ended up even slightly below what they paid for the original ULA, a remarkable win given their usage had increased. This was achieved by removing unnecessary extras and hard negotiation on the core ULA price.
- Enhanced ULA Value: The new ULA still provided the unlimited coverage the client needed for databases, Siebel, and middleware. Additionally, Oracle did include some cloud capacity, but as a free add-on rather than a paid component, thanks to negotiation. This means the client can experiment with Oracle Cloud in a limited way at no extra cost, but isn’t financially obligated to shift workloads there. Essentially, they got more flexibility for less money.
- No Compliance Hangover: By renewing on favorable terms, the client avoided the scenario of a punitive audit. Oracle, seeing a renewal signed, had no reason to audit. And thanks to Redress’s contract safeguards, even if the client chooses to exit at the next term, they have clarity on their rights. The audit threat was neutralized without the client ever having to endure one.
- Budget Predictability: The CFO and finance team were pleased with the predictability achieved. The negotiated deal locked the support costs and eliminated the 4% annual indexation Oracle initially included. Over the course of three years, this avoidance of indexation also saves a significant amount (Oracle’s standard support uplift could have added another few million). The IT budget for Oracle spend is now fixed and even slightly declining year-over-year when adjusted for inflation – a huge relief for a business under competitive pressure to cut costs.
- Strategic Alignment: The outcome aligned with the company’s strategic needs. They maintained unlimited usage rights where needed (on-premise deployments for core systems) and kept the optionality for cloud. They did not have to commit to a cloud direction they weren’t ready for. This means they can proceed at their own pace with digital transformation, possibly considering other cloud or on-premises solutions alongside Oracle, without being financially constrained by the ULA.
- Confidence in Vendor Management: The successful negotiation boosted the confidence of the client’s IT procurement team. It was a textbook case of how to stand up to a powerful vendor with the right data and expertise. The team learned a great deal from Redress about Oracle’s playbook and how to counter it. This knowledge is an intangible yet valuable outcome – it equips the client for future negotiations, be it with Oracle or other software vendors.
Client Quote
“We knew renewing our Oracle ULA was necessary, but we refused to accept Oracle’s first offer at face value. Redress Compliance made sure we didn’t have to. They dissected Oracle’s proposal, showed us where we had leverage, and led a negotiation that achieved what we initially thought was impossible – a better deal than our last one. Redress brought an objective, expert perspective that kept Oracle honest. The savings are huge, but just as important is the peace of mind that we didn’t leave money on the table or agree to terms we’d regret. In an industry as tough as telecom, that’s a big win.” – CIO, French Telecom Operator (anonymous)
Call-to-Action (CTA)
Preparing for an Oracle ULA renewal? Don’t go it alone. Contact Redress Compliance for a free ULA renewal strategy session. We help companies like yours benchmark Oracle’s offers, uncover hidden costs, and negotiate from a position of strength.
A call with Redress Compliance could mean millions saved and a smarter contract. Reach out today to ensure your next Oracle ULA.
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