Blog

Oracle's Java Licensing Changes: How to Protect Your Company

By Robert Stapleton

February 2023

In recent news, Oracle has made significant changes to its commercial Java licensing model, including removing the Processor metric and Named User Plus metric availability for Java SE Universal Subscriptions. These changes have the potential to significantly impact your business operations and bottom line. The purpose of this article is to summarize the changes, provide an analysis of what Oracle is not saying, and offer advice on how to navigate the new licensing model in order to protect your company and get the most out of your Java license.

Oracle’s announcement on January 23rd, 2023 outlined three main points:

  1. Oracle will no longer offer subscription Java on a Processor or Named User Plus model.
  2. The only model available going forward will be an employee-based license. This means that in order to license Java from Oracle, you will have to license all of your full-time, part-time, temporary employees, and contractors, regardless of whether they are actually using the software.
  3. Existing Java subscription clients can renew their Java contracts under the same “terms” and “metrics.”

It’s important to note that these changes will only affect new customers and will not affect existing customers that renew their Java support contracts. However, Oracle will likely push for existing customers with legacy metrics (Processor and Named User Plus) to switch to the new employee-based license. This can be achieved through up-selling and mainly through audits or the threat of an audit.

 

Implications of the new licensing model

The elimination of the Processor metric removes the ability for companies to effectively manage and limit their Java licensing costs. This new employee-based licensing model may result in significantly increased costs, as the number of licensed employees, rather than hardware, will now be taken into account.

A good example of what this means for Oracle’s customers can be found in Oracle’s “Oracle Java SE Universal Subscription Global Price List.”. According to the list, “Your company has a total employee count of 28,000 as detailed in the Employee for Java SE Universal Subscription definition below. This includes 23,000 full-time, part-time, and temporary employees plus 5,000 agents, contractors, and consultants. Therefore, the price would be 28,000 X $USD 6.75/month X 12 months = $USD 2,268,000/year.”

Avoiding License Term Violations

Another implication of the new licensing model is the potential for organizations to unknowingly violate licensing terms. The new model is more complex than the previous processor-based model, making it more difficult for organizations to accurately track and manage Java usage within the company. This increases the risk of organizations accidentally violating licensing terms, which can result in significant fines.

Pricing Note 3 in the “Oracle Java SE Universal Subscription Global Price List” references the following: “Contact Oracle for Pricing if Java SE Universal Subscription is installed on and/or is running on more than 50,000 Processors. For purposes of calculating the 50,000 Processor limit, desktops and laptops are excluded.”

It’s worth noting that this is a mistake. The limit should be 50,000 employees, in line with the volume limit for the different employee tiers in the pricing table.

TCO measurement & impact

There are also concerns about the lack of transparency from Oracle on the true cost implications of the new model. Oracle has not been entirely clear about the specific costs associated with the new employee-based licensing model, making it difficult for organizations to accurately budget for these changes.

 

How to protect your company

In order to protect your company from the implications of Oracle’s new Java licensing model, it is important to take action. One of the first steps is to review and audit current Java usage within your organization. This will help you to identify any areas where you may be at risk of violating licensing terms or where costs may be higher than expected.

Another important step is to look into alternative options, such as using OpenJDK or transitioning to a different technology. OpenJDK is a free and open-source implementation of Java, and it may be a viable alternative for some organizations. Additionally, there are other technologies available that may be a better fit for your company’s needs.

In some instances you may be able to deploy Oracle Middleware to benefit from the Java included licenses. However, it is important to note that the Java licenses included with this offering (e.g. with a license for WebLogic Suite) all come as restricted-use licenses for the specific Middleware solution purchased. In effect not solving your Java development needs but adding more to the up-sell or cross-sell Oracle capabilities.

At this point, you may be considing licensing support services, such as those offered by Cintra. Cintra’s team of experts can help you to ensure compliance with Oracle’s licensing terms, and can also help you to optimize costs. They can also provide guidance and support as you navigate the new employee-based licensing model.

It is important to stay informed and up-to-date on any further changes to Oracle’s Java licensing. Oracle may make additional changes in the future, and it is important to be prepared for these changes in order to protect your company. Speak to Cintra‚Äôs licensing experts today.

 

Conclusion

In conclusion, Oracle’s recent changes to their Java SE Universal Subscription licensing model have the potential to significantly impact businesses, resulting in increased costs and a lack of control over licensing requirements. It is important for you to understand the changes and their implications, and to take steps to protect their companies by utilizing alternative solutions such as OpenJDK or Oracle Middleware.

Additionally, it is important to be aware of Oracle’s sales tactics, such as pushing for longer-term contracts and up-selling, and to be prepared for potential audits or threats of audits. By being proactive and utilizing the solutions and resources available, you can navigate the new Oracle Java licensing model and make the best decisions for their business operations.