Oracle Partners On Java Price Changes: ‘Doesn’t Make Sense’

‘Having to license your entire employee count is not reasonable because you could have 10,000 employees, maybe only 500 of them need Java. And maybe you only have a couple of servers for a couple of applications. But if you have to license for your entire employee count, that just doesn’t make sense,’ says House of Brick Technologies’ Jeff Stonacek.

Oracle’s change on pricing for the Java standard edition (SE) license by total employee count is likely to rile customers that have a fraction of employees who work with Java, Oracle partners told CRN.

But the added complexity is an opportunity for partners to help customers right-size their spending with Austin, Texas-based Oracle.

Jeff Stonacek, principal architect at House of Brick Technologies, an Omaha, Neb.-based company that provides technical and licensing services to Oracle clients, and chief technical officer of House of Brick parent company OpsCompass, told CRN that the change has already affected at least one project, with his company in the middle of a license assessment for a large customer.

He called the change “an obvious overstep.”

“Having to license your entire employee count is not reasonable because you could have 10,000 employees, maybe only 500 of them need Java,” Stonacek said. “And maybe you only have a couple of servers for a couple of applications. But if you have to license for your entire employee count, that just doesn’t make sense.”

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Oracle Changes Java Pricing Rules

In an email to CRN, Mike Ringhofer, Oracle’s senior vice president of worldwide Java business, said that “the new Java SE Universal Subscription was developed based on feedback from our enterprise customers with Java workloads running in increasingly diverse environments.”

“It no longer requires enterprise customers to count every single Processor, Desktop, or Named User that may be using the subscription, and the permitted use is universal across desktop, servers, and cloud infrastructure,” Ringhofer said. “Java SE Universal Subscription is a new product and does not change anything for existing enterprise customers with the previous Subscription offering. The new Java SE Universal Subscription also does not change how Java is sold when embedded in a device, application, or sold with ‘shrink-wrapped’ software.”

Java SE Universal Subscription replaces a legacy subscription launched in 2018 that charged per processor for servers and cloud instances and per user for PCs, according to CRN sister publication Computing. Oracle promises that legacy users will, for now, be able to renew under their existing terms and conditions.

The subscription is also not eligible for application-specific full use licensing, embedded software licensing, ISV licensing or redistribution, according to Oracle.

The Oracle Java SE Universal Subscription global price list released in January shows subscriptions costing $15 per employee for fewer than 1,000 employees, meaning companies pay less than $15,000 a month. Included in the employee count are full-time, part-time and temporary workers as well as contractors, agents and consultants.

The price decreases to $12 for between 1,000 and 2,999 employees, or between $12,000 and $35,988. The price decreases to $10.50 for between 3,000 and 9,999 employees, costing between $31,500 and $104,989.50.

The price lowers to $8.25 for between 10,000 and 19,999 employees, bringing the cost to between $82,500 and $164,991.75.

The price is $6.75 for between 20,000 and 29,999 employees, a cost of between $135,000 and $202,493.25. The price is $5.70 for between 30,000 to 39,999 employees, a cost between $171,000 and $227,994.30.

For between 40,000 and 49,999 employees, the price drops to $5.25 per employee, costing between $210,000 and $262,494.75. Customers with 50,000-plus employees are asked to “contact for details.”

Oracle Partners React

Stonacek and his team have been talking to customers about migrating to Open Java Development Kit (JDK), a free and open-source version of Java Standard Edition (SE), although that was a practice started before the price change.

He estimated that about half of the customers his team talks to are able to easily move to OpenJDK. Sometimes, customers have third-party applications that are written for Java and unchangeable as opposed to custom applications that in-house engineers can just rewrite.

Other vendors including Red Hat and Microsoft have their builds for OpenJDK. Amazon offers Corretto, a no-cost multiplatform production-ready OpenJDK distribution, as another example.

The old subscription model was $2.50 a month for each desktop user and $25 a month for each Java SE processor.

A company with 250 employees, 20 Java desktop users and eight Java installed processors would pay $3,000 a year under the old licensing model, according to House of Brick.

Under the new model, the price increases to $45,000, 15 times the old amount.

For a company with 250 employees with all employees using Java desktop and 48 Java installed processors, the price under the old model was $21,900 a year.

Under the new model, the price increases to $45,000 a year, more than double the prior amount.

Oracle started charging license fees for Java in 2019 for patches and updates, according to The Register. In 2021, it released a no-fee license with free quarterly updates for three years for Java 17.

Wayne Federico, COO and vice president of technical services at Woodbridge, N.J.-based Oracle partner Miro Consulting, told CRN that Oracle audits on Java have only popped up in the last year or so.

When trying to move some customers to an open-source option, sometimes they will push back for fear of losing updating support and of potential security vulnerabilities.

Federico said he expects most customers to end up paying more under the new model.

“I don‘t want to say completely, but I would say most of all of the situations I can think of, it’s going to be more expensive,” he said. “And in a lot of cases it could be significantly more expensive.”

Still, the Java situation is another proof point for the value a partner brings customers, Federico said.

“These kinds of things, they just add more complexity to the situation,” he said. “So it doesn’t really have a negative impact to us.”

Ron Zapar, CEO of Naperville, Ill.-based Oracle partner Re-Quest, told CRN that even without a direct effect on partners from the Java license change, the move makes customers question whether they want to purchase Oracle Cloud offerings and other Oracle products lest they face future changing terms or lock-in.

Re-Quest is working on getting Oracle Cloud certified this year and has seen demand for the offering for disaster recovery and backups, Zapar said. He doesn’t want to see that activity change due to negative headlines.

“Being out of the resale part of it, we just get the blowback but we don’t participate in the process,” he said. “That doesn’t make positioning any of the Oracle solutions including cloud any better.”