Jul 25, 2017

Writing Your Happy Ending: What to Look For in Your Oracle Contracts

You need some Oracle licenses. So you buy them, and now all you need to do is to install your purchases, use the software, and live happily ever after, right? Well, not really…

We all know that license deployment often represents the challenge of all challenges for Software Asset Management (SAM). But customers should never ignore or pay less attention to the contractual side. That, sometimes, can be the Holy Grail when it comes to correct usage – and staying compliant.

Some questions arise:

  1. Tracking: What do I do with my contracts?
  2. Important clauses: Are they useful somehow?
  3. Extra licensing rules: Are there any other sources of information that I should consider?
  4. Transparency: What about licensing condition updates?

Gradually, we will answer all the above.


The first rule of thumb is simple: never lose track of your signed agreements with Oracle. In addition to this, it is highly recommended to record them chronologically and adopt a standard naming procedure:

Suggested Example:

  • OLSAv12345_CustomerName_ 12May2013 - the 1st purchase
  • OLSAv12345Amend1_CustomerName_ 27May2016- the Amendment 1 to the 1st purchase

Believe me - this helps! I stressed the word signed in reference to your Oracle agreements since that represents validity from a legal perspective. It is common for drafts to circle around and then, at a later stage, for these to be amended. Once the auditor knocks at your door, you will need to be able to quickly trace all the changes. You need to be prepared and know where to look for the documentation that you need.

Important Clauses

The Oracle License Services Agreements (now called OMA: Oracle Master Agreement) and the Ordering Documents hold valuable information about:

  • Territory
  • Transfer and assignment
  • Divestiture
  • Price holds
  • Migrated/terminated licenses
  • Metric definitions
  • Customer definitions
  • Audit clause
  • Minimums
  • Plus any other license usage clauses which influence deployment

It’s helpful to keep in mind that there are many other type of agreements Oracle offers. Due to their large number of acquired companies, you always need to check what the contractual rules stipulate and which one prevails.

Read about changes in Oracle Java SE licensing

Extra licensing rules

Oracle has several information sources available online, and you will notice a common theme throughout most of them. In almost all published sites, you will find a sentence that states that they do not have a contractual commitment to any terms. But what isn’t mentioned is that customers may also receive these documents when they sign their agreements.

The most important sources:

  • Oracle Partitioning Policy - This defines what Oracle considers soft and hard partitioning. Be warned, it can have high cost implications when misunderstood (just think about VMWare).
  • Oracle Software Investment Guide – This is a comprehensive guide for all the most important product categories and their licensing models, and also includes calculation scenarios.
  • Oracle Help Center – This is Oracle’s Knowledge Base. Here one can find licensing information and technical instructions on all Oracle products.
  • Oracle Processor Core Factor Table – This is used for processor calculation.
  • All Price Lists – This is where metric definitions may sometimes be updated without notice, so regular checks are recommended.
  • Oracle Software Technical Support Policies – These can carry high cost implication when it comes to reinstatement support fees. For example, these charges can equal 150% of the last annual support + the support fee for the elapsed time, depending on certain conditions listed in the document.


Licensing conditions related to usage and deployment are communicated to customers through amendments if they affect current agreements, or if there’s been particular compliance discussions that leading up to these changes. However, the general rules are updated without notice. So, one must check regularly to confirm if something has changed. The best example of this is the rule modification for Oracle in the Cloud Computing Environment.

As you can see, license management is a full time job which requires dedicated resources. So, keep your eyes open and make sure you value and read documentation! Taking these key steps will help you in successfully managing your licenses for the long term!

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Topics: Oracle, SAM Insights