Oracle Licensing Optimization (Complexity, Compliance, Configuration) Ed Hut Karen O Neill Oct 23, 2014

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1 Oracle Licensing Optimization (Complexity, Compliance, Configuration) Ed Hut Karen O Neill Oct 23, 2014

2 Presenters Ed Hut, CEO, DBAK Ed is the Chief Executive Officer at DBAK and has been working with Oracle products and technologies for more than 20 years. He has talked with and counseled a broad range of clients on Oracle Licensing in a variety of industries that include financial services, technology, communications, oil & gas, retail, and professional services. He focuses on direct communication, business strategy and business outcomes. Ed brings deep knowledge of a wide range of technology complemented by an ability to understand critical business issues. In addition to his experience with Oracle Licensing and Software Asset Management, Ed provides strategic direction, manages business development, and oversees top-line leadership functions for DBAK. Karen O Neill, Certified Software Manager (CSM) and LMS Manager at DBAK Works directly with companies on the complexities involved in achieving licensing compliance including the Software Review Process, Software Inventory, Configuration, Risk Mitigation, Contract Management, Pricing Strategies, and overall licensing strategy. More than 19 years in IT including database engineering, software analysis, project management, system administration, hardware and software evaluation. 2

3 Company Snapshot Oracle Gold Partner Oracle Experts, easy to work with Oracle License Reseller Oracle Database and Applications Consulting Expert Managed Services Average 20+ Years of Oracle Expertise 150+ Clients Global reach - offices in Denver, Dallas and NY 3

4 Disclaimer DBAK is an Oracle Gold Partner in good standing with Oracle Corporation. This presentation does not constitute legal advice. Your Oracle licenses are governed by your Oracle License and Services Agreement and the Oracle Software Technical Support Polices. This presentations is intended to give you a better understanding of Oracle products, product versions, licensing policies and the common application of these policies. 4

5 Agenda License Compliance License and Support Agreements Oracle Licensing Policies and Metrics Configuration Right-Sizing Key Support Concepts Break 10 min. Working with DBAK 5

6 Top 7 Reasons to be Compliant with Oracle Licensing: 1. Reduce risk 2. Avoid penalties 3. Complexity with Software contracts 4. Staying on track with software deployment 5. Audit readiness 6. Simplifying organization of software licenses 7. Reduce time and resources required to participate in audits 6

7 Context Compliance Use Cases $8M $3.2M $2M $4.8M 1.9B Company 146M Company 750M Company 69M Company License revenue reconciliation as a result of audit activity 7

8 How Vendors Select a Customer For Audit How vendors select a customer for audit 75% 50% 50% 25% 13% Internal inconsistency in purchasing patterns History of poor licence compliance Size of customer Mergers and acquisitions *Respondents were able to choose more than one option. Number of countries operating in *Source: "Software compliance without tears - Monitoring customers software usage in a complex world", Ernst & Young,

9 Why Customers Struggle to Achieve Compliance Vendors views on why customers struggle to achieve compliance 75% 63% 50% 50% 25% 13% Inadequate management tools at end user Lack of understanding Complexity of contracts/user rights Lack of management attention *Respondents were able to choose more than one option. Lack of due diligence in mergers and acquisitions work High cost of software *Source: "Software compliance without tears - Monitoring customers software usage in a complex world", Ernst & Young,

10 License and Support Agreements OLSA- Oracle Licensing and Services Agreement Defines terms, conditions between Oracle and End User. Also, commits End User to the terms and conditions Oracle Technical Support Policies Oracle Master Agreement/Transactional Oracle Master Agreement/ License Rules & Definitions These documents have replaced the OLSA ELA- Enterprise Licensing Agreement ULA- Unlimited Licensing Agreement Typically defines the users right to use specific quantities of specific products for a defined period of time. Usually discounted and usage must be certified at the end of the period. Typically used for deployments where it is impossible or impractical to track product usage or the IT environment is growing rapidly. Ordering documents Describes quantities and price. May contain licensing terms and language that augments or amends OLSA. 10

11 License and Support Agreements Common Myth You don t have to license TEST environments. We were subject to a license audit that resulted in almost a million dollar non-compliance bill, and one of the things we got nailed on was that we had test environments and we were not properly licensed for the test environments. We are not a large organization, so this was significant. Director of IT for a high-tech manufacturer 11

12 License and Support Agreements Key Terms: Common Myth You don t have to license DR. Failover: Subject to the conditions that follow below, your license for the programs listed on the US Oracle Technology Price List, which may be accessed at includes the right to run the licensed program(s) on an unlicensed spare computer in a failover environment for up to a total of ten separate days in any given calendar year (for example, if a failover node is down for two hours on Tuesday and three hours on Friday, it counts as two days). The above right only applies when a number of machines are arranged in a cluster and share one disk array. When the primary node fails, the failover node acts as the primary node. Once the primary node is repaired, you must switch back to the primary node. Once the failover period has exceeded ten days, the failover node must be licensed. In addition, only one failover node per clustered environment is at no charge for up to ten separate days even if multiple nodes are configured as failover. Downtime for maintenance purposes counts towards the ten separate days limitation 12

13 Software Compliance Spectrum Determine usage and license demand Installs Usage Metric Selection Attributes License Demand Define Compliance Position and Financial Liability Review Discovery Data Determine License Demand Assess Financial Liability Optimize Oracle Footprint and Licensing Need Optimization of License Allocations Infrastructure Optimization Software license audits are a legitimate way for vendors to ensure they're getting paid for software that's actually being used. However, CFOs can be unaware of software contract provisions permitting these audits, which can result in an unexpected budget shock when presented with a true-up bill. *The cost of these true-ups can be significant, so CFOs should take the necessary steps to reduce their risk by implementing software license management processes and technologies to help ensure continual compliance. 13

14 Oracle Database Licensing License Metrics Limited single user Named User Processor Legacy Metrics UPU (Universal Power Units), etc. Management Packs and Options Oracle Real Application Clusters (Oracle RAC) Oracle Active Data Guard Real Application Testing (Oracle RAT) Partitioning Tuning Diagnostics Etc 14

15 Oracle Database Environments/ Oracle Database Editions Which one do you need? Database environment: Environments to license Development Limited or Full Use Test/Staging Full Use Production Full Use Oracle Database Editions, each suitable for a different scenario: Standard Edition One: Full-featured database for servers with up to two sockets. Standard Edition: Full-featured database for servers with up to four sockets. Enterprise Edition: No restrictions on core count. 15

16 Per Processor Licensing License count Based on total number of CPU Cores on server Adjusted using core factor table Factors are x 0.25, 0.5, 0.75 and 1.0 depending on chip Two steps to calculate total licenses #server licenses=roundup(sum(cores* core factor)) #total licenses=sum(server licenses) 16

17 Processor Example Dell PowerEdge 605 Oracle Core Factor.5 2-Quad Core AMD Opteron 2.4GHz (8 cores) x (.5 core factor)= 4 cores/processors You must License 4 processors of Oracle DBEE $231,800 17

18 Named User Plus Licensing License count based on Named Users active or not Named humans Non-human operated devices i.e. Automated data feeds Number of CPU cores or sockets ( processors ) Database Edition Enterprise Edition min 25 per core Standard Edition (& SE One) min 5 per core Required licenses Whichever is the greater (of minimum or actual count) Named User minimum licenses per processor * number of processors Total number of actual named users License allows access to any instance on the server 18

19 Named User Example 20 Users 2 Single-core Processor Server = 50 Named Users Oracle Database EE Rule: You must calculate the actual number of users AND the user minimums per processor. **You must license whichever is greater** *DBEE user minimum 25 Named Users per processor 19

20 Virtualization The Evolution of Oracle s Policy on Virtualized Environments You can t do it!!!! You can t do it! If you do; we won t support you!! You shouldn t do it. If you do; we ll make it difficult to support you! You can do it and we will help you if it s known problem. 20

21 Virtualization FAQ Q: Can I run Oracle products in a virtualized environment? A: Yes Q: Are Oracle products certified in virtualized environments? A: No Q: Will Oracle support me if I have a virtualized environment? A: Maybe, if the issue is a known issue on the native OS or can be demonstrated not to be the result of running VMware. Covered in Oracle Support Note ID

22 Virtualization My Oracle support document ID Oracle has not certified any of its products on VMware virtualized environments. Oracle Support will assist customers running Oracle products on VMware in the following manner: Oracle will only provide support for issues that either are known to occur on the native OS, or can be demonstrated not to be as a result of running on VMware. If a problem is a known Oracle issue, Oracle support will recommend the appropriate solution on the native OS. If that solution does not work in the VMware virtualized environment, the customer will be referred to VMware for support. When the customer can demonstrate that the Oracle solution does not work when running on the native OS, Oracle will resume support, including logging a bug with Oracle Development for investigation if required. If the problem is determined not to be a known Oracle issue, we will refer the customer to VMware for support. When the customer can demonstrate that the issue occurs when running on the native OS, Oracle will resume support, including logging a bug with Oracle Development for investigation if required. NOTE: Oracle has not certified any of its products on VMWare, and use of Oracle products in the RAC environment is also not supported. 22

23 Fully Licensed VSphere Clusters When you have enough Oracle application instances to rationalize creating a dedicated cluster for those applications, all the hosts in the cluster can be fully licensed for the application. This approach has numerous advantages: Customers can deploy an unlimited number of virtual machines running the Oracle application on the cluster. The cluster becomes an all you can use cluster from an Oracle licensing standpoint. Typically, this enables a significant reduction in licensing requirements by consolidating physical processors and licenses. 23

24 Oracle Product Licensing Configurations and Their Optimization Oracle Licensing in VMware Environments When running products that are licensed by physical processor on vsphere, customers should ensure the following: Virtual machines are running on hosts fully licensed for Oracle. Virtual machine movement within a cluster is restricted to hosts that are fully licensed for Oracle. Virtual machine movements should be tracked so that customers can validate their compliance with Oracle licensing policies. 24

25 Hard Partitioning vs. Soft Partitioning There can be two types of virtualized environments: Soft-Partitioning and Hard-Partitioning Soft-Partitioning, CPU capacity can be changed on runtime as additional resource is needed. This is a flexible way of managing resources. Hard-Partitioning, a physical server is separated into distinct smaller systems, each with its own CPUs. Oracle licensing is straightforward. One has to license for all the CPUs configured on the system in case of soft partitioning and only for number of CPUs configured to that partition in case of hard partitioning. 25

26 Right-Sizing Size According to Need: Example IBM P750 server 24 core 5 year cost = $240,000 Oracle prices + Enterprise Edition = $47,500 + Table Partitioning = $11,500 = EE + TP (std config.) = $59,000 Software = $2,973,600 + Annual Maintenance *5 = $64,900 = Per processor 5 year cost = $123,900 Core factor for P750 = 1 24 core * 1 core factor * $123,900 pp = $2,973,600 Total 5 year cost $240,000 + $2,973,600 = $3,213,600 Hardware = $240,000 26

27 Right Sizing Your Environment Using only 1 cpu on soft partitioned server Mixing APPs with DBs on same server Mixing product options on one server Memory-starved server Fractional licenses with core-factor adjustment 27

28 Rules of Thumb for Licensing Oracle Only license what you need, only install what you need Use hardware exclusively Max out memory to boost computing power Combine like with like at the licensed option level Avoid fractional counts 28

29 Recommended Software License Review Process Information Gathering Consolidate Information Review and Confirm Compliance Check Avenues for Compliance Eliminate Compliance Risk Institute Forward Compliance Process 29

30 Oracle Support 22% of the net price of your purchase Entitles you to updates and support Is governed by your OLSA and Oracle technical support policies Support is difficult to change! Key Support Concepts Know the support implications of your licensing decisions Understand what you can and can t do Understand key support concepts: license sets, de-supporting, back-support, penalties, co-terminate, etc. Review and monitor your support agreements 30

31 Summary - What to Consider Maintain up-to-date software information Develop a strategy and process for vendor audits Measure the benefits of software asset management efforts Prepare for new technologies Communicate Build a relationship with software vendor DBAK can help you with all of this 31

32 Break 10 min Don t go away Drawing for a GoPro Hero 3+ Camera at the end of the presentation 32

33 DBAK Can Help Dedicated resources Broad experience and institutional knowledge Implement software discovery tools Trusted advisor Education and training Reduce cost Ensure license optimization 33

34 DBAK Oracle Licensing Services Comprehensive set of services around Oracle Licensing License Sales Software Advisory Solution Risk Mitigation Compliance Licensing Strategy 34

35 Questions? 35

36 Contact Charlie Pigeon (972)

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