Spring is here! It’s the season for renewal and not just the natural kind. With Oracle renewals just around the corner, today we’re going to explore your options when it comes to exiting your ULA.
This is a big job and to be properly prepared, you should really aim to begin planning your ULA exit at least six to twelve months ahead of your exit. This allows you to go into the negotiation with Oracle confident in your license position and armed with a good strategy.
Timeline for Oracle renewal planning:
- 12 months: Select Project Team for Renewal/Exit
It is best to direct conversations with Oracle through one single person – the designated negotiator. That person should refer to a project team. This ensures that there are not ten people talking to Oracle, saying different things, or contradicting information. There can be people listening/cc’d in of course, but one of the best negotiation strategies is saying things like: “I have to take this back and discuss it with the team/board etc.” as it avoids having to provide information or make decisions on the spot.
The team of people should include product owners, procurement, and relevant business leaders, all of whom should work together to ensure a successful exit. This team should understand the relationship with Oracle and be aware of all commercial activity outside of the ULA.
In addition, there should be a line of communication between the designated team and a C-level executive (if not already involved). They will need to sign off the deployment and usage at certification. If Oracle suspects that the ULA will not be extended, they may try to go above the designated negotiator to discuss with C-level decision makers themselves.
This is another place to be careful. Oracle may have relationships in the C-suite, and they will try to leverage that connection, so you should make sure that the board is in full support with the negotiation. We recommend having regular touch points throughout the process to keep all involved up-to-date, especially if there are possible compliance issues.
- 9 months: Investigate License Position and Prepare ELP
Once your team is set up, you should identify their current requirements with an in-depth Effective License Position (ELP). Oracle may involve the LMS audit team if there is a certification, so you need to be prepared. It is also important that you validate the license numbers produced by your technical teams because Oracle has several license restrictions and policies that can impact license certification counts. The data needs to be properly validated to avoid unhappy surprises down the road.
This period is arguably the most important phase as having accurate visibility of the Oracle estate will put you in a good state to negotiate with Oracle. It is important to know what is deployed and in use before planning negotiations. Understanding the software usage and any potential non-compliance issues in advance will prepare you for the ULA exit as well as allow you to optimize the Oracle estate in the years following the ULA exit.
- 6 months: Optimize License Requirements, Add-in Future Requirements and Plan Negotiation
Once you have a good idea of license consumption in the current environment, you should review how it can be optimized and whether there are other factors that could impact the negotiation, such as other Oracle agreements. Oracle ULAs traditionally only cover some products (database & middleware), but you might have some middleware and, more commonly, application software outside (e.g. e-Business suite or Peoplesoft). Potentially there are some cloud agreements or even Java agreements to keep in mind.
Customers should also consider any expected growth or upcoming changes to the environment as well, such as upcoming hardware refreshes, merger and acquisition activity or cloud migration. If these are on the horizon, be sure to account for these potential changes with contract language in the ULA if this will be extended.
After identifying the current needs, you can optimize the setup to avoid compliance claims.
During this period you also have the opportunity to maximize the ULA deployments in order to claim as many licenses as possible when certifying. Customers should also familiarize themselves with the limitations in their ULA to prevent non-compliance from growing along with the licensing footprint and to ensure an accurate license position can be created.
- 3 months: Finalize Negotiations and Notify Vendor if Necessary
Oracle LMS and account managers typically reach out to customers around three months before the end of the ULA. Be prepared for a lot of back and forth with Oracle as this usually includes various forms of usage counts validation for the ULA Certification. The LMS team will scrutinize the certification numbers as well which may lead to discussions.
It is very also important to check the certification language in your ULA, usually found in the Certification Process section. It might only include that “You shall furnish Oracle with a certification signed by a C-level executive of your company” in which case you are not contractually obligated to run LMS scripts and provide outputs.
Remaining firm in the decision to exit the ULA is key as Oracle will likely push for an extension instead (at a higher price, of course), and will prefer the customer to certify with as little software as possible. If the counter-offer on the table to extend the ULA, rather than exit, is good enough and genuinely presents a better option, you can of course consider it and agree. Make sure you are prepared to go through the same process again next time if you do extend the Unlimited Agreement.
- 0 months: Contract Execution
Once you have provided Oracle with the certification, this is the optimal time to implement guardrails and processes to ensure that technical teams follow the contract and limit non-compliance. Ideally, all customers will monitor license consumption regularly to mitigate potential compliance issues.
End of ULA Options
Exiting the ULA
After the Certification Process is completed, your unlimited quantities will become fixed at the declared amount and the licenses will be perpetual. Support fees will remain the same (if you maintain the support numbers) but will be subject to the annual uplift.
Renewing the ULA
If Oracle notices that you have non-compliant deployment of Oracle software, you may find yourself in the position to renew the ULA or purchase new licenses and support for the non-compliant product/(s). The most common examples of non-compliance are:
- Using Options or Packs that are not part of ULA
- Allowing more than the defined legal entities to use the software
- Deploying the software outside of the territory listed in the ULA terms
- Deploying the software in non-Oracle cloud
If you have uncertainty around your Oracle estate, you may believe the only option you have is to renew your ULA. This typically occurs when a customer has left it to the last minute to understand the licensing requirements based on their ULA terms and limitations, and the Oracle software has been left unmanaged throughout the term of the deployment.
Managing Your ULA from Day One
Oracle prefers to keep their client base in ULAs as it provides a steady stream of both license and support revenue. But you have the power to closely monitor your Oracle estate and take informed decisions that benefit your organization.
To get the best long-term deal on Oracle licensing for your organization, a thorough process is required. We recommend getting expert advice early to help you through this process. A process that has the potential to save you millions.
Anglepoint’s team of Oracle experts have years of experience as both Oracle employees and navigating the tricky world of exits and renewals. Get in touch today.