How Redress Compliance helped Telefonica save EUR 40M over five years by transitioning from Oracle direct support to third-party support after ULA certification, while maintaining full compliance, system integrity, and operational independence.
Telefonica, a multinational telecommunications company headquartered in Spain, operates across Europe and Latin America, employing over 100,000 staff. Like many large enterprises, Telefonica built much of its IT infrastructure on Oracle technology: Oracle Database, WebLogic, RAC, and SOA Suite, deployed under a certified Unlimited License Agreement.
After certifying the ULA and securing perpetual licence rights locked in across the full Oracle stack, Telefonica was left with a persistent problem. Oracle's ongoing support costs were consuming a disproportionate share of the IT budget: EUR 8M+ per year, climbing steadily despite a largely stable software stack. With no plans for new Oracle investments but no desire to risk system integrity, Telefonica engaged Redress Compliance to explore how to reduce support costs without compromising performance, compliance, or business continuity.
Oracle's 22% support model included annual increases (typically approximately 4% per year), even for static deployments. Over five years, this meant support fees would surpass EUR 50M unless action was taken.
Oracle's policies made it impossible to drop unused licences without losing entitlements entirely. Even minimal-use products carried full-price support. The classic "all or nothing" support trap meant Telefonica was paying premium fees for products it barely used.
Many Oracle workloads were mission-critical but stable. Telefonica was not leveraging Oracle patches or upgrades at a level that justified the EUR 8M+ annual spend. At the same time, stakeholders feared that reducing Oracle's involvement could trigger compliance issues or degrade support quality. Overcoming entrenched Oracle dependency required education and evidence.
IT, finance, and procurement teams lacked the expertise to dissect Oracle contracts, the licensing footprint, and support obligations, making informed decision-making difficult without external help.
Could Telefonica continue running Oracle reliably, but on radically better financial terms? The answer would require deep contract analysis, stakeholder alignment, and a structured transition that preserved compliance while transforming the cost structure.
Redress conducted a full inventory of Telefonica's Oracle licences, usage patterns, and support entitlements. By analysing server-level deployments and historical support spend, they identified multiple products still incurring full support fees despite minimal or zero active usage, several Oracle instances no longer in active use but still covered under support, and products where no critical patches or Oracle assistance had been consumed in years.
To align stakeholders across IT, finance, and procurement, Redress ran workshops that clarified Oracle's support terms and restrictions, debunked myths about third-party support's legality and effectiveness, and evaluated workload criticality and business impact. This transparency helped Telefonica overcome internal resistance and build consensus around new support strategies.
Redress presented several pathways including renegotiating with Oracle, reducing partial support, and switching to third-party support. Based on workload maturity, the most compelling option was: retain Oracle licence ownership (certified post-ULA perpetual licences remain fully valid), transition to a reputable third-party support provider at approximately 50% of Oracle's cost, and internalise patch management where needed. Redress shortlisted reputable third-party support vendors, negotiated service level terms, and guided Telefonica through vendor due diligence.
Redress built a step-by-step roadmap for migrating support: structured onboarding with the new third-party provider including knowledge transfer, full documentation of licence boundaries to preempt any future Oracle enquiries, and internal usage tracking systems to ensure no drift beyond the licensed scope post-transition.
| Dimension | Before: Oracle Direct Support | After: Third-Party Support via Redress |
|---|---|---|
| Annual support cost | EUR 8M+ per year | Approximately 50% reduction |
| Pricing model | 22% of list price + 4% annual uplifts | No annual uplifts baked into contract |
| Coverage scope | Support on unused/inactive products included | Support only for products in active use |
| Flexibility | No ability to drop individual products | Flexibility to add/drop coverage by product |
| Upgrade governance | Oracle-dictated upgrade and patching timeline | Self-directed upgrade and patching governance |
| 5-year projected cost | EUR 50M+ projected | EUR 40M saved over 5 years |
Immediate savings by moving the bulk of support to third-party providers. The annual Oracle support budget was effectively halved in the first year of the transition.
Cumulative savings by avoiding Oracle's approximately 4% annual uplifts and eliminating support for unused products. Support costs now aligned to actual business need rather than Oracle's list-price model.
No audit triggers or compliance incidents, thanks to meticulous licence mapping, entitlement documentation, and internal usage controls established during the transition.
Telefonica now dictates its own upgrade and maintenance timelines. Oracle can no longer enforce support-based lock-in. Faster, more personalised assistance from the new provider.
"Redress Compliance showed us what Oracle never would, that we had options. Their deep knowledge of Oracle contracts and licensing gave us the confidence to move to third-party support. We are now saving EUR 40 million over five years and still running every Oracle system we need, securely and on our terms."
Yes. Once a ULA is certified, the perpetual licences are yours to keep regardless of whether you continue paying Oracle for support. You retain full rights to use the software at the certified quantities. However, dropping Oracle support means you lose access to new patches, updates, and Oracle's My Oracle Support portal. This is exactly why many organisations transition to third-party support. You keep the licences and get continued support at roughly half the cost.
Third-party Oracle support is maintenance and technical assistance provided by independent vendors (such as Rimini Street, Spinnaker Support) instead of Oracle. It is entirely legal. You own your perpetual licences outright, and nothing in Oracle's agreements requires you to purchase support exclusively from Oracle. Third-party providers typically offer the same or better SLAs, faster response times, and personalised service at 50 to 60% lower cost.
You will no longer receive new patches from Oracle directly. However, reputable third-party support providers deliver custom security patches and fixes for vulnerabilities, often faster than Oracle. They also provide guidance on hardening configurations and may cover zero-day vulnerabilities that Oracle has not yet patched. For stable, mature Oracle deployments, this is typically more than adequate.
Oracle's audit rights typically survive the termination of support, as they are embedded in the licence agreement itself. However, if your licences are properly documented and certified (as in Telefonica's case), the audit risk is manageable. The key is meticulous entitlement documentation and usage controls, exactly what Redress established during the transition, so that any future enquiry from Oracle can be answered quickly and definitively.
Most organisations save 50 to 60% on annual support costs in Year 1, with savings compounding over time because third-party contracts do not include Oracle's automatic 3 to 4% annual price escalators. Over a typical 5-year period, cumulative savings can reach 60 to 70% compared to staying on Oracle support. For Telefonica, this translated to EUR 40M saved over five years on an EUR 8M+ annual baseline.
Third-party support is best suited for stable, mature Oracle environments where the software stack is not undergoing major upgrades or version changes. If you are actively migrating to new Oracle versions or deploying new Oracle Cloud services, Oracle direct support may still be necessary for those specific workloads. Many organisations adopt a hybrid approach: third-party support for stable legacy systems and Oracle direct support for actively evolving components.
Before transitioning: complete a thorough licence inventory and entitlement documentation, apply all available Oracle patches and download all support materials from My Oracle Support while access is still active, evaluate third-party providers through formal due diligence (SLAs, references, security capabilities), establish internal usage controls to prevent licence drift, and provide Oracle with the required notice period (typically 30 to 90 days before your support renewal date). An independent advisor can guide the entire process to ensure nothing is missed.
Redress Compliance provides independent Oracle advisory for third-party support transitions: licence inventory and entitlement documentation, vendor due diligence and selection, transition roadmap development, compliance safeguards, and ongoing governance. We help enterprises reduce Oracle support costs by 50 to 60% while maintaining full system integrity and compliance. Complete vendor independence. No Oracle partnerships, no third-party support provider affiliations, no resale commissions.
Oracle Advisory ServicesIndependent Oracle advisory helping enterprises transition to third-party support, reduce Oracle costs by 50 to 60 percent, and maintain full compliance after ULA certification. Fixed-fee engagement models.