Reducing Oracle Support and Maintenance Costs
- Review unused licenses to terminate and cut costs.
- Consider third-party support for lower service fees.
- Downgrade to lower-cost editions like Standard Edition.
- Optimize license usage by reallocating underused licenses.
- Consolidate instances to reduce overall licenses.
- Negotiate with Oracle for better support terms.
- Explore alternative platforms to reduce dependency on Oracle.
Seven Strategies for Reducing Oracle Support and Maintenance Costs
Oracle’s support and maintenance fees can form a large part of an organization’s IT budget.
Standard fees account for 22% of license costs and increase up to 8% annually, so these expenses can rise quickly. However, companies can use several strategies to reduce these costs without sacrificing service quality or compliance.
Conduct a Thorough Review of Oracle Licenses
The first step is understanding your Oracle license estate. Conduct a comprehensive review of all Oracle licenses to identify unused or underutilized ones.
Many organizations hold licenses they no longer need due to changes in staff, projects, or business requirements.
- Terminate support for unused licenses to achieve immediate cost savings.
- Manage the termination process carefully to avoid unintended consequences, such as the repricing of remaining licenses.
Consider Third-Party Oracle Support Providers
Third-party support providers, such as Spinnaker Support and Rimini Street, offer significant cost reductions compared to Oracle’s support fees. These providers often charge 50% less than Oracle, making them an appealing alternative.
- Limitations: Third-party providers don’t offer Oracle updates, patches, or upgrades, so it’s most suitable for organizations with stable environments or those planning to transition from Oracle.
Before switching, evaluate your organization’s specific needs and ensure you understand the services provided by third-party support, comparing them to Oracle’s support offerings.
Downgrade to Lower-Cost Software Editions
Organizations using Enterprise Edition may not fully utilize its advanced features. Assess whether downgrading to Standard Edition—which costs significantly less—can meet your business needs.
- Enterprise Edition comes with higher costs, while Standard Edition can offer savings of up to 65%.
- Analyze your requirements before switching to ensure the lower edition provides the necessary functionality.
Optimize Oracle License Usage
Review and optimize your Oracle license usage regularly to avoid unnecessary spending. Oracle usage patterns can shift over time, leaving licenses underutilized.
- Re-harvest unused licenses and reallocate them where necessary.
- Switch to more cost-effective licensing models, such as moving from processor-based licenses to Named User Plus licenses, which align more closely with actual usage.
- Consolidate instances of Oracle applications to reduce the total number of licenses needed.
Explore Alternative Platforms and Solutions
Moving workloads away from Oracle can provide substantial savings. Open-source databases, cloud-based solutions, or other commercial databases are viable alternatives to Oracle.
- AWS Aurora PostgreSQL offers up to 70% savings compared to running Oracle on EC2.
- Microsoft SQL Server may also be cost-effective, especially for organizations already invested in the Microsoft ecosystem.
Migrating to alternative platforms requires careful planning, often done through a phased approach, where some workloads stay on Oracle while others transition.
Negotiate with Oracle
Negotiating reduced support fees with Oracle can be challenging but not impossible. Oracle is more likely to make concessions to retain valuable customers.
- Prepare thoroughly: Understand your Oracle usage and requirements.
- Create leverage: Explore alternative support options or migrate some workloads to competitors.
- Engage early: Start negotiations well before renewal dates to allow time for detailed discussions.
Consider negotiating multi-year contracts to cap annual increases or using credits to offset costs. Committing to other Oracle services, like the cloud, may help secure better terms.
Implement a Comprehensive Cost Reduction Plan
To achieve the greatest impact, develop a comprehensive plan that combines several cost-saving strategies. Begin by thoroughly analyzing your Oracle environment to identify potential savings.
- Involve key IT, procurement, and finance stakeholders to ensure everyone is aligned.
- Set clear targets and timelines and assign responsibility for each initiative.
- Monitor progress and adjust your approach as needed.
A multi-faceted approach to Oracle cost reduction allows companies to save significantly without compromising service quality. Although the process can be time-consuming, the savings make it worthwhile for companies that optimize their IT budgets.
FAQ: Reducing Oracle Support and Maintenance Costs
What is the first step to reducing Oracle support costs?
Conduct a thorough review of your Oracle licenses to identify unused or underutilized ones. Terminating support for these licenses can lead to immediate savings.
Are third-party support providers a viable option?
Yes, third-party providers like Spinnaker Support and Rimini Street often offer lower-cost services, but you should assess the trade-offs, such as not having access to Oracle updates.
Can I downgrade to a cheaper Oracle software edition?
If you are not using Oracle Enterprise Edition’s advanced features, consider downgrading to Standard Edition to save on license and support costs.
How can optimizing license usage reduce costs?
Regularly reviewing and reallocating unused licenses can prevent the need to purchase new ones, leading to reduced support and license fees.
What are the risks of terminating Oracle support for unused licenses?
Terminating unused licenses can reduce costs, but ensure you understand Oracle’s policies to avoid repricing or unintentional breaches of your licensing terms.
How can consolidating Oracle instances help with cost savings?
Consolidating databases and applications onto fewer servers reduces the number of licenses needed, cutting both license and support fees.
What alternative platforms can reduce Oracle support costs?
Open-source databases or cloud solutions like AWS Aurora PostgreSQL can provide cost-effective alternatives, potentially saving up to 70%.
Is it possible to negotiate better Oracle support terms?
Yes, negotiating multi-year agreements or bundling services like cloud with licenses can improve your negotiation position and reduce annual increases.
What should be considered before switching to third-party support?
Evaluate your organization’s need for Oracle updates and patches, as third-party support doesn’t include these. Ensure the support provider can meet your critical needs.
How does Oracle’s repricing policy affect terminated licenses?
When terminating support for some licenses, Oracle may reprice the remaining ones based on current rates, potentially negating savings.
How can I use licensing tools to manage costs?
Licensing tools, such as Oracle’s LMS collection tool, provide insights into underutilized licenses, allowing you to adjust and optimize usage and reduce unnecessary costs.
Is re-harvesting licenses a good strategy?
Yes, re-harvesting unused licenses and reallocating them where needed helps avoid buying new licenses, leading to reduced support costs.
What are some common support fee reduction tactics with Oracle?
Multi-year contracts with price protections, credits to offset costs, and capping annual fee increases are common tactics for negotiating reduced support fees.
What’s the benefit of centralizing license management?
Centralized license management prevents duplicate purchases, improves reallocation efforts, and helps understand actual license needs better.
Should I consider moving Oracle workloads to the cloud?
Moving non-production environments or less critical workloads to the cloud can reduce on-premise license requirements and take advantage of more flexible pricing models.
Read about our Oracle License Management Services.
