Oracle licensing practices lead to mistrust among customers, says survey

Oracle's licensing practices have created a "hostile" relationship "filled with deep rooted mistrust" between the vendor and its customers, according to a survey that looked at users' business interactions with the company.

Nearly 90 percent of respondents, which included software asset managers, IT asset managers and software licensing specialists from 100 organisations, held negative views on handling Oracle's audit requests.

When asked if Oracle audit requests are easy to respond to and manage, 44 per cent of respondents disagreed with that statement and 44 per cent strongly disagreed, according to the poll from the Campaign for Clear Licensing (CCL). The U.K. organisation advocates for transparent and manageable software licensing programs.

"It boils down to mistrust between Oracle and customers," said Martin Thompson, founder of the CCL.

The mistrust stems from user perception that directing licensing questions to Oracle Global License Management Services (LMS), the department that helps customers manage software licenses, will result in an audit instead of advice. Audits may reveal additional software or licenses that the company has to purchase, turning a customer support experience into an Oracle sales opportunity, said Thompson.

"It's perceived that any question becomes a trigger. They don't ask the questions because it may end with an audit," he said.

Only 22 per cent of those surveyed found LMS helpful during the audit, contract renewal and negotiation process. Asked if working with LMS would foster a better relationship between customers and Oracle and result in companies buying more Oracle products, only 24 per cent agreed with that notion.

Thompson emphasised that his organisation isn't against Oracle. Manageable licensing terms helps businesses complete tasks faster, he said.

"If software is easy to transact, it gets deployed faster. If we can remove barriers, things can happen quicker," Thompson said.

In fact, the CCL noted that it showed its survey to Oracle and discussed the results with the company at its U.K. headquarters.

"Oracle is trying to address these concerns. Some of it is customer perception," he said.

A section of the survey results that examines specific Oracle customer issues includes responses from the company as well as recommendations from the CCL. Oracle told the CCL that customer questions don't generate audits or sales pitches and data from advisory sessions isn't shared with the sales department.

However, LMS will audit if they believe "something is missing" and notify the customer's account manager if they think "any shortcomings exist" regarding a license.

According to the survey, Oracle users believe the company has communication issues and they aren't keen on shuttling between LMS and Oracle's sales team for answers about licensing, sales and renewals.

Customers may need to accept that working with Oracle "is difficult and involves significant due diligence," said the CCL. And judging by the comments from Oracle that were included in the survey, the silos between different departments will remain.

For example, LMS admits that while customer licensing documents are sometimes not regularly updated, keeping this information current is the sales department's duty and LMS can't be held accountable for those inaccuracies.

Oracle declined to comment on the survey.

Oracle users looking for help navigating the licensing waters should join a user group, said Alyssa Johnson, president of the Oracle Applications Users Group.

"The survey talked about how some of the challenges were communication between Oracle and customers. This is really an area where we, as a user group, try to help provide additional information or help to our members," she said.

User groups offer classes and networking events on licensing topics. Her group's customer support council offers members the opportunity to make Oracle aware of their pain points.

"This is a forum for our members to bring their challenges and areas where they feel like Oracle can improve directly to Oracle," she said.

Thompson noted that many large, established enterprise software companies have contentious relationships with customers. The pattern of companies providing excellent and poor customer service is cyclical and companies must balance revenue needs with helping users, Thompson said.

"It isn't like Oracle is the evil empire. These software companies aren't charities. They need to make money," he said.

Oracle may want to review the licensing agreements of Amazon Web Services, a competitor in the cloud computing space, said Thompson. Amazon's policies are straight forward and designed "to make things as frictionless as possible," he said.

Fred O'Connor writes about IT careers and health IT for The IDG News Service. Follow Fred on Twitter at @fredjoconnor. Fred's e-mail address is fred_o'connor@idg.com