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Oracle on VMware - What you need to consider


In Episode 2 of our Oracle video briefing series, we ’ll take a look at VMware, specifically at the licensing implications and potential scenarios associated with licensing Oracle on VMware. We’ll delve into VMware’s licensing rules, VMware environment integration as well as VMware’s relationship with ULAs.

Licensing Oracle on VMware

Running Oracle products and technology on VMware architecture has its benefits. It can help simplify Oracle IT environments, giving organizations some agility and control over their Oracle estates. For some Oracle customers, it can also provide them with the option to increase their range of product options and is an effective way of running business-critical applications.

In today’s ever-changing digital landscape, virtualizing Oracle estates with VMware can also help organizations more effectively leverage resources and enables organizations to respond more efficiently to constantly changing business needs.

But when it comes to licensing on VMware, Oracle has some unusual rules – primarily that Oracle requires all processors, or CPUs, in the entire VMware estate to be licensed.

What to consider

The licensing rules for Oracle on VMware can be a little unclear, but the first place to look for clarity is at how Oracle defines the term ‘processor’. This is the most common metric Oracle uses for its technology products, and it states that a license is required for anything that is installed and/or running. In other words, you need to have licenses for all the processors that form part of your ‘VM-farm’; even if you have only installed a processor but aren’t actually using it, you are still required to purchase a license from Oracle.

What can I do?

Buy a ULA – This can be the go-to reaction for many Oracle customers looking to tackle the VMware licensing issue. But while it might seem like a good idea, and might appear like you will be able to cover all your licensing requirements in one fell swoop, it isn’t necessarily the best strategy. Oracle knows this is a solution many people turn to, making it difficult to gain leverage during negotiations as a result. If you’re looking to grow your product usage and deployment, then a ULA can be beneficial, allowing you to scale without having to buy additional licenses – but if there is no growth on the horizon for your Oracle estate, then it can be an expensive endeavor and could end in a never-ending cycle of ULA renewals.

Find out more about Oracle ULAs in Episode 1 of our series, here.

VMware segregation – Arriving into the market a few years ago, VMware segregation is something that Oracle doesn’t proactively promote to its customers – but it is possible to obtain. In simple terms, VMware segregation is a set of terms & conditions that are included in an Oracle contract – whether an ULA or other type of agreement – that means you do not have to license all of the CPUs in your VM-farm, only the ones that actually run the product. You have to ask for it though, and it does come with a set of technical requirements from Oracle, including segregation at network and storage level. Oracle also requires customers to create a roadmap of what their VMware environment looks like and how it could be segregated, which can be a technical hurdle for some organizations. Generally speaking, Oracle can be open to negotiating this segregation as part of a deal, but you have to know your Oracle VMware estate inside out in order to provide the sufficient evidence as to why you should be exempt from the licensing rule.

Keep your records straight – It is vital to keep track of all your Oracle products and licenses that are deployed throughout your entire VM-farm. This not only helps with negotiating things like the VMware environment segregation, but also gives you leverage for other types of negotiations, whether it’s a ULA renewal, exiting an agreement or negotiating how to successfully bring two Oracle estates together as a result of a merger. In addition, by knowing exactly what your technical and licensing requirements are, you can be fully prepared for any future audits from Oracle.

On the ultimate extreme of the scale, some organizations have also decided to challenge Oracle in court over its VMware licensing stipulations – and if you have proof and evidence that your licenses have not been moved around in the VMware estate, there is every chance, as some organizations have seen, that you could come away with a settlement and no requirement to license your entire VMware estate. While this is an extreme solution, if you are going to challenge Oracle’s licensing rules – whether in court or at the negotiation table – then you have to know your Oracle VMware environment like the back of your hand and have the ability to prove to Oracle by using logs, screenshots, etc that your licenses have only been deployed on the same hosts without having had moved through your extended VMware estate.

By controlling and optimizing your Oracle investments and deployments, you can gain valuable understanding of your compliance, consumption, costs and contract. To find out more about managing your Oracle estate, register for our full Oracle Briefing Series here.

Or for more information, visit our dedicated Oracle page, email us on or complete this form and one of our contract experts will be in touch.


About the Author


Razvan Tarnovschi, Oracle Practice Lead

Razvan joined Livingstone Group in 2021 as Oracle Practice Lead and brings with him 13 years of Oracle experience.  During this time, his responsibilities included negotiating high dollar value contracts with customers.  Razvan has a deep understanding of the language of Oracle's complex contracts including policies and terms.

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