Escape Hatch from Oracle Research Mission Declaration
For the past few years, as an analyst, blogger, and consultant, I have studied the way that Oracle has licensed its products and conducted audits to ensure compliance. I have worked with companies who help improve negotiating leverage, provide services for supporting and migrating from Oracle products, and talked to many executives who have become frustrated by how they have been treated by Oracle. I have documented the state of affairs between Oracle and its customers in articles like this one (“Four Common Mistakes In Understanding Oracle’s Cloud Troubles”).
During this period, it has become clear to me that there is a vacuum of leadership and analysis about how to manage a vendor and customer relationship with Oracle. This Early Adopter Research Mission, Escape Hatch from Oracle, is intended to fill that vacuum by launching a program of service journalism about how to understand and evaluate your Oracle landscape.
This research mission is dedicated to serving people who are struggling with the following questions:
- How can I improve my bargaining power in my relationship with Oracle?
- How can I can optimize my use of Oracle technology?
- How can I determine the right way to prune my Oracle portfolio?
- How can I navigate a complete escape from using any Oracle products?
- What alternative products can replace Oracle products?
- What must I do to avoid any possible exposure in a licensing audit?
- Now that I am being audited, how can improve my negotiating position?
If these questions are on your mind, the team at Early Adopter Research hopes to help you find answers.
What This Research Mission Will Do For You
Many companies are currently in a bind because they do experience a lot of value from their suite of Oracle products. Many of those tools are tied to vital enterprise functions and would be near impossible to give up. Oracle products run a huge part of the business world. For that reason, Oracle technology deserves respect. This Research Mission is not about trashing Oracle products.
It is a lot harder to respect the way Oracle treats its clients. Oracle is widely known for its aggressive sales tactics. Oracle routinely uses audits to create negotiating leverage and then force more sales that serve Oracle’s needs more than the clients. There is even a name for this sort of abuse: Audit, Bargain, Close.
Oracle’s behavior has created a difficult situation for many companies. On the one hand, they rely on Oracle products and use them to run their businesses. On the other hand, they don’t like being subject to audits that can end up feeling like a shakedown.
From Oracle’s point of view, there is no shakedown. If you don’t want to use Oracle software, then don’t. If you do use it, pay up. What’s unfair about that? Well, at a high level nothing at all. I’ve never met an Oracle customer who felt they had a right to steal software from Oracle.
But there is a much more subtle game afoot here. Oracle’s auditing model works because the distribution and use of Oracle products is designed to make it easy to slip out of compliance. In a sense, Oracle has taken a page from the world of open source, which removes prior restraint with respect to downloading, using, and modifying software.
In Oracle’s case, and this is still surprising for most people when they hear it, there are no barriers to downloading and using Oracle products. There are no license keys needed. If you want to use more databases, download the software and get them going. And of course when you download them, the software generally comes with the maximum amount of licensed features turned on. If they stay on, license liability goes up.
When you add to this licensing policies that expand the number of licenses needed when the software is deployed on virtual machines or in other ways, only the most disciplined companies can stay in compliance. One of the episodes of this research mission will focus solely on developing the discipline needed to stay in compliance.
The result of this model is that companies are often out of compliance. Oracle is able to use licensing audits to find unauthorized use of products and then use the negotiating leverage from this liability to encourage a wide variety of behavior on the part of customers that ranges from simply paying more under new license terms to buying products that the customers don’t intend to use but Oracle would like to sell.
None of this is news to Oracle customers, competitors, or those of us who are close observers of Oracle practices. What we hope to make news is explaining what to do about it.
Creating an Empowerment Plan
Granted, not a lot of companies, large or small, are eager to pick fights with Oracle. However, today, with a growing number of companies offering ways to escape from Oracle, or attain greater contractual positioning, it is time to look at the big picture and do some serious reporting on what works best.
Oracle customers fall into a variety of segments:
- Some want to make sure they stay in compliance with their licenses.
- Others want to reduce their Oracle footprint, but keep running some products.
- Many customers I talk are full of resentment and are eager to get rid of all of their Oracle products.
This Research Mission will have episodes that help each of these segments by researching answers into the following questions:
- How does the Oracle sales, licensing, and software delivery process and policies work to create liability?
- What can companies do to avoid unauthorized use of Oracle products?
- How can an Oracle footprint be divided into easy, medium, and hard to migrate segments?
- When does third-party support make sense?
- What kind of assistance do third-party licensing and auditing consultants provide?
- What are the future trends in Oracle auditing?
- What alternative products can replace an Oracle footprint?
- What are the complexities and problems that appear when migrating from Oracle?
- How can you make the best of spend forced on you by Oracle?
- Why is Oracle using audits to promote purchases of Oracle cloud?
- What are the features of Oracle’s database that are hard to replicate?
- How can third-party applications that run on Oracle be migrated to run on other databases?
This is just the first batch of questions. Many more will be added over time.
Our goal is to provide answers that lead to an effective, implementable plan for empowerment with Oracle.
Can Oracle Be Reformed?
We have one other mission: Reform of Oracle. Larry Ellison is an amazing entrepreneur and technology executive. I have always admired the way that he has kept the title of CTO, because, unlike many people who operate at the most senior levels of business, he really is a tech guy.
Larry Ellison is part of a very short list of people (see: Bill Gates, Steve Jobs, Michael Bloomberg, Jeff Bezos) who started a company, led it through many stages of growth, and then was able to run it after it became a large, global, multi-faceted enterprise. This is an amazing accomplishment.
As we have noted, Oracle products also deserve praise. The world could not run as it does today without the service Oracle provided in creating a stable, high-quality relational database with needed capabilities and performance to run mission-critical applications. It is possible to criticize Oracle products in many ways, but they do not suck. In fact, let’s be honest: they are awesome. You can rely on them and the massive ecosystem surrounding them. That’s part of what makes a relationship with Oracle so tricky: customers usually want and need to use Oracle products. They derive benefits from and have often built their technology systems around them.
But these benefits are frequently outweighed by the toll of Oracle licensing habits and audits. Therefore, it would be ideal if Oracle returned its focus to creating great products and the next platform. In many ways, Oracle’s innovative energy has been too geared on optimizing its licensing audit process to maximize its financial performance. I’m not arguing that Oracle doesn’t need to make money, but a strong argument can be made that Oracle has ignored the cost of being so aggressive with its customers.
Here’s how I put it in the article linked above:
“…JPMorgan analyst Mark Murphy remarked that “Oracle is losing its significance in enterprise IT.” Arete Research Services reported in 2017 that 74% of CIOs plan to reduce their spending with Oracle.”
“Independent-minded technology leaders are starting to think twice about how deeply they want to commit to Oracle. On the Customer Service Scoreboard, Oracle earns a rating of “terrible.” Customers complain of the company using tactics such as audits to manipulate them into upgrading or moving to their cloud.”
Many Oracle customers I have spoken to are just not interested in finding out about Oracle’s new products because they don’t want to be subject to aggressive tactics. They’ve been burned one too many times before and only want to engage with Oracle going forward if they have a more balanced relationship.
Oracle obviously knows that its tactics create bad will. Yet, at least currently,, Larry Ellison and his team have decided they would rather have the money than the trust and appreciation of their customers. This is a bad policy, one that might work in the short-term, but not the long-run, and will absolutely destroy Oracle’s chances in the cloud business, which is an existential threat. Trust, once destroyed, is not restored by declaring a do-over.
Now that Oracle is being downgraded by some top tier analysts, it may be time for taking a drastic measure like ceasing to be so aggressive in auditing customers and instead attempting to build a market for products by attracting customers with good products and good service.
I don’t have high hopes, but I suspect that if Microsoft and SAP can extract huge value without being so aggressive and creating so much negative energy, Oracle can too. And, yes, I know that people complain about being shaken down by SAP (aka Shut up And Pay) and Microsoft, but their tactics are not nearly as onerous as Oracle’s.
Ethics of the Mission
This is a high-stakes arena, but we hope that Oracle views this as constructive criticism, rather than rejecting our efforts out of hand.. Our goal is to show how to successfully navigate a relationship with Oracle whenever possible, and only in select cases, when it is right for the specific business, to actively participate in a full-out departure from Oracle.
But we want any criticisms of Oracle to be completely fair. There is no reason we have to avoid extolling what is great about Oracle. As we already mentioned, there products provide a lot of benefits. But there is also no reason to sugarcoat any criticisms.
In our experience, the CIOs and CTOs who are trying to find solutions to their problems are just as ruthless as Oracle. They want real intelligence from the marketplace about what works and how each solution fits their needs. Cheerleading for one vendor or another is a waste of their time.
If this Research Mission doesn’t provide useful information about Oracle but just a bunch of “techsplaining,” it will fail. But if we provide a place where you can learn about how you got into your situation with Oracle and how, if need be, to get out of it, if we can show you where to get help along the way and what products and services provide credible alternatives, then we will deserve a large audience.
Let me be perfectly clear: the reason I’m mounting this effort is to make money. In this regard, I am the same as any publisher and just like Oracle. I see a gap in the market. Coverage of how to escape from Oracle is very thin. If Early Adopter Research can provide a steady stream of high-quality analysis, reporting, and advice, we should be able to build and monetize an audience.
To be transparent, in order to fund this mission, we will be working with sponsors who are seeking to support various escape routes from Oracle. When you see an article in this Research Mission, if it has been sponsored or developed in close collaboration with a vendor, we will disclose that at the top of the article. In the absence of such disclosure, the article represents our best thinking. If you want to see how Oracle uses sponsored content, please visit the Oracle Brand Voice site on Forbes.com and you will find Oracle’s point of view.
In addition, we will be offering field reports and other interviews with practitioners who are not named. We need to do this in order to allow a more substantial flow of information. If we only rely on sources willing to go public, we would find it very hard to do the reporting we need to do. This reluctance to criticize Oracle in public and the fear of reprisals is one of the reasons the body of content related to the Escape Hatch from Oracle ecosystem is so small.
Oracle may accuse us of making stuff up. But we are not and will show our work with evidence and real-life experiences. Any skilled CIO or CTO will be able to tell nourishing content from cheerleading. We hope all our content is nourishing and when it isn’t, please let us know on Twitter (@EarlyAdopterEAR) or by sending me an email.
Let the research mission begin.
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