The most common clauses included in Oracle’s ULA (I)
In our previous article, we explained why the ULA is not as unlimited as you might think. To sum it up, the limitations of a ULA are governed by the clauses within the agreement. Some clauses are product and usage related, whilst others refer to your organization. In this article, we will zoom in on the product and usage related clauses.
The front page of a ULA includes a table which specifies the different Oracle programs that are part of the agreement, the associated metrics (e.g. Processor, Application User) and the specific quantity of licenses obtained. If an Oracle program is not listed in the program table, you are not entitled to deploy it through this agreement. In case the quantity of the table states “unlimited” then the related Oracle program can be deployed in an unlimited capacity. If the quantity of the table states “Max X Processors”, the related Oracle program can only be deployed up to that maximum amount of processors. Oracle sometimes includes specific restrictions about the deployment of the included programs. For example, licenses that can only be used in an unlimited capacity for a specific application, licenses that can only be used in an unlimited capacity for non-production purposes, or licenses that can only be used for a specific proprietary hosted application. In case such an additional restriction is applicable, this is typically indicated in the contractual document by any of the following references before the Oracle program itself “#”, “*”, “Ù” or “ÙÙ”.
Total support stream
The Total Support Stream specifies which support maintenance fees are bundled into one single “support stream”. This total support stream includes a number of support streams such as:
- the net support maintenance fees to be paid for the new ULA programs
- the existing support maintenance fees for the individual orders that your organization entered into with Oracle, only related to the Oracle programs included in the ULA (the so-called “Converted & Replaced Licenses”)
- the existing support maintenance fees for the individual orders entered into by legal entities acquired by – or merged with – your organization during the term of the ULA, only related to the Oracle programs included in the ULA
- the net support maintenance fees paid for and purchased by you through a price hold, if your ULA includes such a price hold.
As a result of the above, all the existing and new support maintenance fees are bundled into a single order with one single Customer Support Identifier. In case you had multiple support renewals with multiple CSI numbers, this will drastically reduce the administrative workload. Reducing your total support stream after you have entered into an Unlimited Agreement however is rather difficult and requires a detailed strategy and expert knowledge. The reason for this is that during the term of the ULA, your annual technical support maintenance fee is fixed and defined in the Total Support Stream clause. After certifying your ULA, you may want to reduce your Oracle footprint and as such your technical support fees, but you will be confronted with Oracle’s “repricing policy” as part of its Technical Support Policies.
Converted & Replaced Licenses
In most cases end users previously purchased a fixed quantity of licenses with the associated support maintenance for programs that are now part of the Unlimited License Agreement. Think for example about an order for 12 Processor licenses Oracle Database Enterprise Edition and another order with 75 Named User Plus licenses Oracle Database Enterprise Edition, purchased years before the end user decided to enter into an Unlimited License Agreement for Oracle Database Enterprise Edition. In such a situation, Oracle requires the end user to terminate these existing quantity-based licenses and to “roll-in” the support maintenance fees of these licenses into the new Total Support Stream. This process of converting and replacing the existing licenses, as well as what to do in case one of the parties missed the roll-in of other unknown licenses upon signing the ULA, is described in this clause.
Entering into a ULA typically involves a large new license and support investment. In return, Oracle is willing to provide a guaranteed pricing (discount level) that will be applied in case you would want to purchase additional licenses. The terms and conditions under which these licenses can be ordered (e.g. only with a minimum net license order value of X) are explained in this section of the ULA. This also includes the provision that when you purchase additional licenses against such price hold, the support maintenance fees of additional purchase become part of the Total Support Stream.
Make sure you validate your own Unlimited License Agreements to confirm the specific terms and conditions that have been agreed between your organization and Oracle, since deviations and/or non-standard language may have been agreed between the two parties.
Now you should have a good overview of the product and usage related clauses and know what to look for when you enter into an Unlimited License Agreement. This is a good start, but you should keep in mind that these are not all the clauses included in a ULA. In the next article we will talk about the organization and term related clauses within Oracle’s ULA.
This article was published on 11-03-2019
Richard is one of the managing partners at B-lay. He started to work in the license management industry in 2004 and worked for almost 10 years at Oracle as regional director of compliance. He uses his knowledge of enterprise software vendors (such as Oracle, SAP, IBM and Microsoft) to educate, equip and enable software end users in their challenges regarding proper software license management. Richard holds a master’s degree in IT, from University of Amsterdam in the Netherlands.