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New Oracle license agreement to join Oracle ULA

Along with the Oracle ULA, Oracle is offering users another contract option, the Perpetual Unlimited License Agreement. Experts discuss the pros and cons.

Craig Guarente, CEO and founder of Palisade Compliance LLC and former head of Oracle's contracts organization,...

confirmed to SearchOracle that some of his clients have been offered Oracle's newest type of licensing agreement, the Perpetual Unlimited Licensing Agreement (PULA).

So far, none of Guarente's clients have taken Oracle up on the offer, but Guarente clarified that "[PULA] exists in that Oracle sales people are saying 'you can do this' to Oracle customers." Whether anyone has taken Oracle up on the offer is not clear to observers, and Oracle has yet to make any official announcement about PULA.

Oracle already offers the Unlimited License Agreement (ULA), where companies pay a flat fee upfront for unlimited licenses to their chosen Oracle products for a set period of time -- most commonly three years. At the end of the time period, Oracle audits the company's use of Oracle products and determines the number of regular licenses to grant, as well as charging for extra services. Unlike an Oracle ULA, PULA has no set end date and price is based on estimated yearly use.

PULA isn't just a new Oracle license agreement; it's a completely new licensing model, according to Guarente. As such, there are no clear guidelines yet for how it works or who it will most benefit. John Matelski, CIO for DeKalb County, Ga., and former president of the Independent Oracle Users Group, said, "This will not be a one-size-fits-all solution.  In other words, licensing deals with Oracle are all individually negotiated, so the total cost of ownership for my organization will likely be different from that of any other organization. "

Benefits attached to growth and costs

Guarente said that PULA would be most beneficial for a growing company, not one that is maintaining a steady state or shrinking. He claimed that PULA would cost more than an Oracle ULA. Picking an Oracle license agreement, according to Guarente, can come down to a choice between saving money now and reducing future costs.

While it will be more expensive, PULA could reduce compliance and licensing costs -- both costs that accrue over time, rather than upfront. Eliminating the need to renegotiate with Oracle, Guarente said, "gets rid of the headache." But, he added, "It's a very, very high price to pay to not have to count for Oracle every few years."

Guarente recommends examining the benefits of PULA in light of the all the possible future license uses for a company. Because PULA's terms remain the same indefinitely, Guarente said, it's important to think about the ways your business might change when you are setting up a PULA. "If you're thinking about one of these agreements, walk through scenarios in your head," Guarente said.

I would be very interested to find out what it would cost my organization.
John MatelskiCIO of DeKalb County, Ga.

"A PULA is likely to benefit customers with a very large Oracle footprint, who are committed to staying with Oracle in perpetuity," Matelski added.

"Depending on what the price point is, [PULA] could be a very good thing, as licensing costs become more predictable and compliance issues all but go away," he said. "In theory, this would minimize the number of licensing issues that come up, and would make it easier for Oracle and customers alike."

Guarente added that with an Oracle ULA, the customer faces a spike in cost every three or so years due to renegotiation. One thing that PULA could do is even this out. However, Guarente said, "It's not a way to help customers reduce their support costs long term."

PULA story still evolving

Right now, PULA is still a developing concept and, Guarente said, "I'd expect what a PULA looks like today to be different next year." However, Guarente does see one clear message from Oracle about PULA: "Why would you use anything else when you're already paying for Oracle?"

In the end, the value of PULA depends on the cost and whether organizations plan to stick with Oracle over the long haul, Matelski said.  "I would be very interested to find out what it would cost my organization," he said.

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