Oracle Licenses: Migrations and Upgrades

oracle license upgrade migration

Introduction

Oracle continuously develops new licensing models and licensing metrics. These changes are typically driven by general changes in IT (e.g. hardware publishers moving from single core to multicore CPUs, introduction of new virtualization technologies), acquisitions done by Oracle (e.g. the acquisition of BEA systems introduced the “WebLogic” licenses) or bundling changes performed by Oracle (e.g. Spatial being part of the Oracle Database itself, no longer requiring a separate license).

Apart from understanding the current licensing models, many end users still struggle with the older license models. Moving to a current licensing model may sound like the “easiest” thing to do, but is this also the most cost efficient for you?

The purpose of this article is to provide you a high-level understanding of the options Oracle offers in terms of a license migration and/or license upgrade. In addition, we’ll give you examples on how you can keep your software licenses aligned with your business needs.

What types of migrations/upgrades can you encounter?

A clear distinction should be made between different types of migrations/upgrades including:

  • license migration
  • supported product migration
  • license upgrade

What is a license migration?

A license migration is applicable in case you convert the use rights you have obtained for a specific (suite of) product(s) from one license metric to another license metric. An example of such a license migration could be that you convert your existing Processor licenses for the Oracle Database Enterprise Edition into Named User Plus licenses Oracle Database Enterprise Edition. A license migration can only be done if your existing – to be migrated licenses – are having an active technical support contract; licenses without an active technical support contract cannot be migrated from one metric to another metric.

A license migration is not a default right that is specified in your Oracle Master Agreement. When you submit such a request towards Oracle, Oracle must approve the migration and may require specific terms to apply (e.g. the requirement to continue the payment of technical support fees for the migrated licenses for the period of X years). Under normal circumstances, Oracle would approve such a migration, in order to grant its end users the opportunity to continue to leverage its historical investments made to comply with its current licensing needs.

A license migration results in new licenses, a new ordering document (called the ‘Migration Ordering Document’) and typically does not require the payment of additional license fees. The moment the license migration is effectuated, a new technical support contract is put in place for the upcoming 12 months; a credit for unused support is being applied for the remaining period of technical support as paid for the migrated licenses.

A license migration can be a so called “ratio based” migration, a “list to list” or a “net to net” migration. In case of a ratio based migration, a specific ratio is applied to convert the licenses from one metric to another metric (e.g. 1 Processor license Oracle Database Enterprise Edition = 50 Named User Plus licenses Oracle Database Enterprise Edition). In case of a net to net migration, a comparison is made between the net value paid in the past vs the net value of the new to be obtained licensed. In case there is a difference between these two fees, a certain license fee may need to be paid (subject to commercial negotiations).

As a note:

A conversion from Named User Plus to Processor licenses, is NOT considered to be a license migration, but a license upgrade. This, since a limited amount of user licenses is converted into a Processor license which grants an unlimited number of users access to the software licensed by Processor. Since such conversion results in an expansion of the use rights grant, this conversion is classified as a license upgrade.

What is a supported product migration?

In case Oracle does no longer sell a specific Oracle license and bundled the features/functionalities of the older license into a new one, a customer cannot be forced to “upgrade” its licenses to the newer product. If the end user continues to pay technical support for its older licenses, the end user continues to have the right to make use of the latest version of the originally purchased features/functionalities (as included in a current new product).

A Supported Product Migration does not require a migration Ordering Document. The customer will only need to download the latest version of the software or order the latest CD Pack. The only fees associated to a Supported Product Migration are the fees for the CD Pack and shipping, if applicable. There are cases where a Supported Product Migration restricts a customer’s use of the new product. So what is the solution to this? A net-net migration can be then performed to remove that restriction.

Migration requirements

The following requirements apply to a license being migrated or upgraded to a current license. Keep them in mind when evaluating your migration options:

  • Licenses that are being migrated must be current on Software Updates License & Support at the time of the migration. If you want to migrate unsupported licenses, you will need to reinstate support as part of the migration.
  • License migrations are subject to approval from Oracle and are not a contractual right that end users can “enforce”.

Migration ratios

Oracle has created a number of standard migration ratios for license migrations that apply to all licenses. Depending on the product and licenses involved, the migration may be handled using a standard ratio (e.g.: 1 Concurrent Device = 2 Named Users Plus) or on a credit basis. In a credit-based migration, the net price of the new configuration is calculated, and a net credit is subtracted from it as paid for the initial obtained licenses. In both cases, support is calculated based on the customer’s existing support configuration and the current support fees of the migrated licenses.

What is a license upgrade?

A number of Oracle programs are sold under different editions. Think for example about Oracle Database Standard Edition 2 and Oracle Database Enterprise Edition. In addition, end users may have bought licenses with a restriction or limitation (e.g. licenses can only be used for test and development purposes, licenses can only be used for Oracle E-Business Suite applications, licenses can only be used for disaster recovery purposes). Or end users may have bought a license for a limited period of time (a so called term license) instead of the more standard “perpetual” licenses. Or customers bought Named User Plus licenses for a limited amount of users, but they actually require at a later stage Processor licenses to cover their unlimited user population.

A so called “license upgrade” is applicable if and when an existing license is expanded in its use-rights. This can for example include the conversion from an Oracle Database Standard Edition 2 to an Oracle Database Enterprise Edition license, a conversion from a term license to a perpetual license, a conversion from Named User Plus to Processor licenses or a conversion from a “Limited Use” license to a “Full Use” license. A license upgrade at all times results in an additional license and associated support fee.

What types of license upgrades can you have?

In order to move your existing license to a less restrictive one, you will need to perform a license upgrade.

Examples of license upgrades include:

  • Named User Plus to Processor
  • Database Standard Edition to Database Enterprise Edition
  • 2-year term license to Perpetual license
  • ASFU (Application Specific Full Use) to Full Use

Conclusion

It is important to stay in compliance at all times with your license grant. In some situations, you might be required to migrate your existing (older) licenses to a current license and/or license metric.

The migration and upgrade requirements can seem complex when you are moving to a new license model. Before doing a license migration or a license upgrade, it is important to have a clear view of your current effective license position and licensing needs.

If you want to get the assistance of experts who can manage and help you better understand your current licensing situation, we can support you in taking control of your software assets. We offer a range of practical solutions through a combination of services and software. Don’t hesitate to contact us and discover the best solution for you.

This article was published on 19-05-2020