Oracle cranks up some prices 40%

Oracle cranks up some prices 40%

Summary: I have this imaginary letter in my head from Oracle to customers that goes something like this:Dear CustomerYou don't need me to tell you we're in the teeth of the worst recession in living memory but as you know, we at Oracle are committed to providing you with the best value possible. Recently we rolled out Fusion Middleware and as I'm sure you all know, this will be the centerpiece around which the long awaited Fusion Apps will integrate.

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I have this imaginary letter in my head from Oracle to customers that goes something like this:

Dear Customer

You don't need me to tell you we're in the teeth of the worst recession in living memory but as you know, we at Oracle are committed to providing you with the best value possible. Recently we rolled out Fusion Middleware and as I'm sure you all know, this will be the centerpiece around which the long awaited Fusion Apps will integrate. We believe that when taken together, these will provide you with an application landscape that delivers outstanding value and potential return on investment.

While putting this strategy together, we've discovered that some components were not appropriately priced and it is for that reason we are introducing new prices for the diagnostic and tuning packs, as well as the database configuration management pack.

Some might be surprised at the extent of the price rises but at Oracle, we believe in sharing in what I'm sure you'll see as your long term good fortune.

Yours sincerely

Larry

The more serious side to this is that TechWorld is reporting that some components have been price hiked by 40%:

Processor licences for the company's diagnostic and tuning packs, as well as a database configuration management pack, are now US$5,000(£3,040), up from $3,500(£2,130) listed on a 2008 price list.

The first two products are meant to help database administrators target and resolve performance problems. The latter tool is used for a range of tasks, such as tracking database configuration changes and ensuring policy compliance.

Meanwhile, a processor licence for the enterprise edition of Oracle's database remains priced at $47,500, following a roughly 20 percent increase last year.

These may be small potatoes in the scheme of things but provide an excellent example of the kind of nickel and diming that customers regularly grumble over. However, as the Techworld article says, these are price negotiation starting points with nothing to stop Oracle offering extra discounts at no penalty and so making buyers look good. That would not be difficult in the current economy. I am hearing reports that customers are demanding and getting up to 90% discount in some deals.

Even so, price is a bit of a distraction. In the current economy, the name of the game must surely be about eeking as much as you can from existing, eliminating shelfware and optimizing apps usage without triggering yet more charges from your supplier.

All the same, I give Oracle credit for producing a price list that we can pick over. Others don't.

Topics: Enterprise Software, Data Centers, Data Management, Hardware, Oracle, Software, Storage

Dennis Howlett

About Dennis Howlett

Dennis Howlett is a 40 year veteran in enterprise IT, working with companies large and small across many industries. He endeavors to inform buyers in a no-nonsense manner and spares no vendor that comes under his microscope.

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6 comments
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  • Maintenance is usually on list price

    Even if you get a 90% purchase discount, the on-going maintenance fee is usually a percentage of current list price.

    N
    Norm_z
  • A Sign the Economy is getting better?

    So, now that the money will start flowing again, we want to be sure that we get our share. Thank you and god bless.

    -Larry
    nucrash
  • 51% operating margin

    I just read my bi-monthly subscription of informationweek and we learn that they managed managed to rise their operating margin to 51% FYI: (Operating Revenue ? Operating Expenses) / Operating Revenues = operating margin

    it's just incredible and your post explain, in part, why it is so.
    tryonQc
  • RE: Oracle cranks up some prices 40%


    You said it all. Oracle is the only company that publishes the price list on the open internet. No one else does. That fact must be appreciated.
    porushh
  • RE: Oracle cranks up some prices 40%

    Yes price increases are no fun specifically when the order is to be placed is small as there is no negotiation power. There are 2 other topics though which are not to be forgotten as they can have a huge impact on the real price that is paid. First the oracle exchange rates used for deals that take place outside of the USA. Secondly, the maintenance fee. oracle likes a 20% maintenance fee.. so one is buying the software each 5 years again. it better be worth the value, and they better be continually developing it further to remain worth the money.
    CherrishIT-23018642275884624380621985550393
  • Our last big consolidation was funded strictly by Oracle

    Or rather, the desire to cut our spend with Oracle. Evidently we aren't alone, since there are consulting groups out there whose main line of business is helping customers cut their software license and maintenance expenses.
    terry flores