oracle universal cloud credits

Oracle Universal Cloud Credits Guide

Summary of this article: 

  • Oracle Universal Cloud Credits (UCs) is a program that allows customers to purchase cloud credits that can be used across Oracle’s entire portfolio of cloud services.
  • There are two models of purchasing Oracle Cloud Credits: Annual Oracle Universal Credits and Pay as You Go.
  • Annual Oracle Universal Credits require an annual commitment to Oracle and provide a discounted rate. In contrast, the Pay as You Go model does not require any commitment, and payments are made monthly.
  • Oracle BYOL (Bring Your License) allows customers to use their existing supported Oracle technology licenses on the Oracle Cloud.
  • The Annual Universal Credits model enables customers to have the flexibility to use any Oracle Cloud Infrastructure and platform service at any time and in any place.
  • This program can help customers scale their cloud usage as their business needs change over time, and it’s essential to review and understand the cost-effective way of moving to Oracle Cloud, whether leveraging existing software licenses or purchasing Oracle UCs.

What are Oracle Universal Cloud Credits

Oracle Cloud Credits is a program that allows customers to purchase cloud services from Oracle; it offers flexibility and cost savings by allowing customers to pay for cloud services in advance and use the credits as needed. These credits can be used for various services such as Oracle Cloud Infrastructure (OCI) and Oracle Cloud Platform services (PaaS), including computing, storage, networking, and databases. The program comes in two purchasing models, Annual Oracle Universal Credits and Pay as You Go. The Annual Oracle Universal Credits require an annual commitment to Oracle and provide a discounted rate, while the Pay as You Go model, does not require any commitment, and payments are made monthly. They cannot be used towards Oracle ERP Cloud or other SaaS services.

Oracle Universal Cloud Credits - Basics

How do Oracle Cloud Credits work?

In the Oracle Universal Cloud Credits program, customers can choose the Annual Universal Credits model, which allows them to commit upfront to an annual pool of funds or credits that can be used for future usage of eligible Oracle Cloud Infrastructure and platform services. The flexibility of this model enables customers to use any Oracle Cloud service at any time and place. Additionally, this model provides cost savings on all the cloud services offered by Oracle.

Two different contract models for Oracle UCC

The Annual-Flex Oracle Universal Credits model requires an annual commitment to Oracle, in which customers receive a discounted rate and have 12 months to burn down the credits. Any unused credits will be forfeited. Invoicing is done in advance for the 12 months, and the credits can be used towards Oracle cloud infrastructure and platform services, including database, middleware, and computing. This model is best for companies that have independently reviewed their utilization of Oracle cloud, as relying on Oracle’s assessment of credit requirements often leads to overestimations.

On the other hand, the Pay as You Go model does not require any commitment, and payments are made on a monthly basis. This model can be used towards Oracle Cloud Infrastructure or platform services, and customers only pay for what they consume; however, pricing is higher than the annual commitment. This model is best for companies that are uncertain about their commitments to Oracle cloud and need to deploy or test Oracle cloud before making an annual commitment.

You will negotiate a discount rate for Oracle Cloud services, discounts being offered from Oracle are conservative and range from 0-20%

universal cloud discounts

That discount is then applied to your burn down rate card.

oracle universal cloud credits

Compare Annual Flex with Pay as You Go

Comparison of the two models of purchasing Oracle Cloud credits in bullet point format:

  • Annual-Flex Oracle Universal Credits
    • Requires an annual commitment to Oracle
    • Receive a discounted rate
    • 12 months to burn down the credits
    • Any unused credits will be forfeited.
    • Invoicing is done in advance for 12 months.
    • Credits can be used towards Oracle cloud infrastructure and platform services, including database, middleware, and compute
    • Best for companies that have independently reviewed their utilization of Oracle cloud
  • Pay as You Go
    • No commitment required
    • Payments are made monthly.
    • It can be used for Oracle Cloud Infrastructure or platform services.
    • Only pay for what you consume/use.
    • Pricing is higher than the annual commitment.
    • Best for companies that are uncertain about their commitments to Oracle cloud and need to deploy or test Oracle cloud before making an annual commitment.

Use existing on-premise licenses for BYOL or buy UCC?

When choosing between Oracle Universal Cloud Credits (UCs) and Oracle Bring Your License (BYOL), it’s important to consider your current technology licenses and usage. Here are a few key points to consider:

  • Oracle BYOL allows you to use your existing supported Oracle technology licenses, such as Oracle Database Enterprise Edition, on the Oracle Cloud.
  • Each supported Enterprise Edition Database will give you two free OCPUs of Oracle platform service and database.
  • For example, if you have 100 Oracle Database Enterprise Edition processors and choose to use them as BYOL, you will be granted 200 OCPU of Oracle Database (1 processor equals 2 OCPU).
  • In contrast, if you don’t have any supported Oracle licenses, Oracle Universal Cloud Credits (UCs) is a pay-as-you-go model where you can purchase cloud credits that can be used across Oracle’s entire portfolio of cloud services.
  • To run 200x OCPU of Oracle Databases of Enterprise edition will cost you approximately $64,000 monthly or $767,000 yearly.
  • The alternative for customers who have available licenses and use BYOL will be a 767 000 $ annual saving if you use BYOL vs. purchasing cloud credit for the Oracle DB EE.
  • Pay attention to Oracle ULA customers – Oracle mentions on their Oracle BYOL FAQ that you cannot count deployments on Oracle Cloud towards your Oracle ULA deployment exit numbers.
Oracle PAYG vs Annual Flex - Advisory

Expert advice on Annual-Flex

An annual-flex agreement with Oracle allows organizations to purchase a set amount of cloud services at a discounted rate, with the flexibility to use them over 12 months. This option can be beneficial for organizations in the following situations:

  • Organizations that have a clear understanding of their cloud usage needs for the next 12 months. This agreement allows them to lock in a discounted rate and use the services as needed without worrying about overspending on cloud services.
  • Organizations that want to take advantage of the cost savings offered by an annual commitment but still want the flexibility to adjust their usage over time. An annual-flex agreement allows organizations to adjust their usage as their needs change without incurring additional costs.
  • Organizations that want to avoid the commitment and uncertainty of a pay-as-you-go model. An annual-flex agreement allows organizations to make a one-time commitment and have a clear budget for cloud services for the next 12 months.
  • Organizations that want to take advantage of Oracle’s entire portfolio of cloud services. An annual-flex agreement allows organizations to purchase credits that can be used across all of Oracle’s cloud services, giving them the flexibility to use the services that best meet their needs.
  • Organizations that are planning for a large-scale project will require significant cloud resources. An annual-flex agreement allows organizations to purchase the resources they need in advance, at a discounted rate, and use them as the project progresses.

In summary, an annual-flex agreement with Oracle can be beneficial for organizations that clearly understand their cloud usage needs and want to take advantage of the cost savings and flexibility offered by an annual commitment while maintaining the flexibility to adjust their usage as needed.

Expert advice on Pay as you go

A pay-as-you-go contract model with Oracle allows organizations to purchase cloud services monthly with no upfront commitment required. This option can be beneficial for organizations in the following situations:

  • Organizations that have uncertain or variable cloud usage needs. A pay-as-you-go model allows organizations to only pay for their services without incurring additional costs for unused resources.
  • Organizations that are new to cloud services or are still testing the waters. A pay-as-you-go model allows organizations to start small and gradually increase their usage as they become more familiar with the cloud and their usage needs.
  • Organizations that are not ready to make a long-term commitment. A pay-as-you-go model allows organizations to start with a short-term contract and renew or terminate it as needed.
  • Organizations that want to avoid the uncertainty of an annual commitment. A pay-as-you-go model allows organizations to make monthly payments without committing to a long-term contract.
  • Organizations that are not sure about the cloud services they will be using in the future. A pay-as-you-go model allows organizations to try out different services and only pay for the ones that meet their needs.

In summary, a pay-as-you-go contract model with Oracle can benefit organizations with uncertain or variable cloud usage needs, are new to cloud services or are not ready to make a long-term commitment, and want to avoid the uncertainty of an annual commitment. It allows organizations to start small, gradually increase their usage, and pay only for what they use.

Need expert help?

  • Oracle OCI Optimization Service is a comprehensive service that helps organizations optimize their consumption of Oracle Cloud Infrastructure (OCI) services.
  • Our team of experts will work with you to:
    • Help you resize your Oracle cloud consumption
    • Design the most cost-effective cloud contract
    • Choose between an annual flex and pay-as-you-go model that best suits your organization
  • Our service includes:
    • An assessment of your current cloud consumption
    • A review of your organization’s usage patterns and future needs
    • Recommendation of the most cost-effective cloud contract model
  • We will help you design and implement a cloud contract that maximizes your cost savings and ensures you have the resources you need to support your business needs.
  • Ongoing monitoring and support to ensure that your cloud contract is working as efficiently as possible, and we will help you make any necessary adjustments to your cloud contract as your business needs change.