A change in the Oracle LMS process ?

Change seems to be in the air – and this will increase pressure on customers

Oracle licensing and LMS audits have a reputation for being confusing, confrontational, and costly.  Unfortunately, the process might be getting even worse.

There is a new troubling trend, according to Palisade.

Historically, Oracle, like many software vendors, issued a preliminary audit report before issuing the “final report.”  The preliminary report gave the audit target a chance to review and refute any analysis or assumptions embedded in Oracle’s findings. It was a critical step because Oracle licensing is rarely black and white, and it allowed both parties to reach a shared understanding of their unique environment.

By skipping straight to the final compliance report, Oracle exerts tremendous pressure on audit targets to resolve outstanding issues on Oracle’s terms.  When the final report is issued, the contractual 30-day clock to resolve compliance findings starts counting down. Consider all of the tasks you’re expected to complete in those 30 days: review the final report, research the findings, present your findings to Oracle (which may take multiple meetings), correct the findings in the final report, reconfigure your environment (where applicable), negotiate pricing, negotiate terms and conditions, and complete the purchase of any required products or licenses.

That’s a lot of pressure to place on the customer.  And with every passing day, the pressure builds — with constant reminders that you are out of compliance and escalation emails.  Before you know it, you are negotiating based on a false narrative. With the 30-day window in the rear-view mirror, Oracle is firmly in the driver’s seat. By now the words “legal” and “escalation” are being thrown around.  Oracle LMS may even throw out the “nuclear option” and talk about contract breach and license terminations.  The stakes are high!

It’s too soon to tell if the recent rush to a “final report” is a new standard Oracle LMS practice or just an outlier for a few unlucky Oracle customers.  We need more data points to know for sure.  However, if this practice proves successful for Oracle (i.e., it brings in more money), then you can be sure Oracle will exploit it.


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Sheshagiri helps companies reduce Software License & Support costs through deployment optimization and risk management in software license compliance audits. His core skills are Software License Management, Enterprise Software Sales & Sales Management.

Sheshagiri is, currently, the Managing Partner & Principle Licensing Advisor at Rythium Technologies. Prior to this, he was a Vice-President in Oracle Corporation.