Buying Oracle program licenses or cloud subscriptions can be a frustrating process. Licensing rules, contract nuances and program definitions can be confusing and downright onerous.
Companies with large IT procurement teams still get it wrong from time to time, by missing some of the basics as well as not understanding the nuances of Oracle program licensing and Cloud subscription agreement terminology.
5 Ways to Get The Best Deal:
- Know The Cost of Doing Nothing
By knowing the cost of the ‘problem’ being solved by the program license and/or subscription, you have the ability to walk away from a bad deal. If the cost of the solution is more than the cost of the problem, then further negotiation is needed. Do you have a plan B? At the end of the day a deal may not work out for one side or the other. What is your backup plan? You must always have one with each negotiation.
- Understand Your Options
Before you begin negotiations, investigate options available to you from this vendor, and other vendors, as well as the pros and cons of each option. Keep in mind that standard options from Oracle may not be the only options that exist. Oracle is aware that every company is different and doesn’t expect one licensing metric will fit all use cases. There are custom solutions available as well as modifications to standard licenses depending on the issue and opportunity.
- Have an Exit Strategy
Many IT solutions are temporary and even those of longer term are subject to the dynamic nature of business including:
- Mergers and acquisitions
- Business diversification
- Business downturns
- Business growth
- Global expansion
What is your plan for getting out the solution you have today to step into the world of tomorrow? Entry cost into a new procurement or agreement is just one cost, but you should also review agreements for the cost of ‘exiting’ as well as renewing the agreements. In many cases the cost of exiting or renewing far exceeds the initial procurement cost.
- Understand Non-Discount Concessions
Non-discount concessions are often more valuable than discount concessions. What is more valuable? It depends on your need and how the programs will be used.
- Global usage
- More favorable product definition
- Different license matrix
- Lower cost of renewal
- Portability to new entities acquired during merger or acquisition activity
There may be hundreds of non-discount concessions that are of value to you.
- What Does The Terminology Mean?
Don’t be afraid to ask for an example. Technology program licensing and Cloud Subscriptions agreements are full of acronyms, new phrases and words that may have different definitions depending on vendor and industry. It is important to get the definitions to these words and phrases and when in doubt, get an example of their application to your use scenario. False assumptions are a killer when it comes to usage agreements. Your flexibility is limited when you leave the definition and interpretations to chance.
Remember, you DO NOT own the software, even after procurement. You own the right to use the software in a very specific way. That is all. It is essentially a ‘usage’ agreement including when you are procuring ‘perpetual’ program licenses. If it is not noted in the agreement and order documents, then seek clarity.
Oracle program license and cloud subscription is not a ‘one size fits all’ proposition. Oracle Corporation has thousands of clients world-wide and it is not expected that one general metric would be good enough for everyone.