Three strategies to reduce your database total cost of ownership
If your company is like most companies, you have an Oracle database problem. You might be using more databases and versions of databases than your company is aware of. And there is a good chance you’re running databases under the false belief they’re all fully supported. Either way, many companies face big risks with neglected database systems. Let’s take a closer look.
In a recent enterprise Oracle database survey conducted by Rimini, we discovered that most companies have multiple database instances – over 75% of the survey respondents have more than 10 database instances, while 33% have more than 100 instances, and up to 8% have more than 1,000. Database environments are complex, and a large number of instances can make it difficult to monitor and maintain a database landscape. In fact, nearly half of all respondents didn’t even know what was in their database environments — or they said they thought they knew, but were wrong.
The rise of unsupported databases
A whopping 74% of respondents surveyed have some databases instances that are no longer fully supported by Oracle because they are on Oracle Database Release 11.1 or earlier. But interestingly, 48% of respondents either don’t know, or are confused about, what is currently supported in their database environment. Which means that many companies are possibly paying full maintenance fees for databases that are in Sustaining Support thereby getting virtually no support at all.
According to Oracle’s Lifetime Support Policy, they are not getting new updates, fixes, security alerts, data fixes or critical patch updates. Oracle charges 22% of the license fee every year for support — even as support services decline over time.
Confusion creates compliance risk
Database customers can easily run afoul of database licensing as they run their business — and increasing numbers of vendor audits will find them. Such is the case for global logistics provider BDP International, who unknowingly had some compliance issues.
The problem is for many customers, like BDP International for example, licensing rules cast a shadow over how modern companies want to utilize databases: They want flexibility without the out-of-control costs and difficult license management. But instead they are getting a complex, confusing approach to their licensing – seemingly always in favor of the vendor.
According to Palisade Compliance, a leading independent provider of Oracle software and cloud licensing and compliance advisory services, Oracle customers can expect to be audited every three years and this pace will only increase as Oracle expands its audit practice to cloud and Java licensing.
The result is that the vendor may levy massive “true up” fees off of their often confusing and complex contract language, and force upgrades that keep customers paying years into the future. Some companies pay millions on otherwise unnecessary and disruptive upgrades. While upgrades address the support issue, they are not a cost-effective answer. And because Oracle databases are rock solid and do the job they were built for, companies can’t find the ROI in disruptive upgrades to versions that offer little new business value.
How does a $3.3 million adjustment fee sound? It happened to BDP International.
There are, however, proven strategies that can help reduce TCO while also improving your overall database environment.
Three ways to reduce database TCO and regain control
1. Use alternative databases: There are about 300 enterprise databases available today, many of which are open source and offer excellent functionality, reliability, and TCO. These databases are completely capable of running most enterprise workloads. Think PostgreSQL, MongoDB, and Cassandra. In fact, in their “The State of Open-Source RDBMSs” report, analyst firm Gartner specifically advises organizations to consider alternative database options for new projects.
Why is using an open-source database particularly good for new projects? First, relational databases are not as differentiated as database vendors want everyone to believe. There are many databases that are secure, scalable, and well-supported in the industry. Second, because open-source databases are by definition not hampered by arcane licensing rules, companies can put them to work with lower license and support fees — or retire them — with little financial consequence. This speeds decision making, promotes application development, and encourages a nimble environment. It is important to note, however, that replacing existing mission-critical ERP databases is often riskier and more time-intensive than it’s worth: Use alternative databases for new application development and keep your systems of record intact.
2. Move to independent support services: Transitioning to an independent support service provider is a proven strategy that reduces high vendor support charges. It’s a strategy that analyst firms like Forrester and Gartner are recommending when clients have relatively stable environments.
Why is independent support a good tactic? First, the cost savings. Customers can save 50% on their annual support fees immediately, and those savings can be redirected to other IT investments. BDP International, for example, moved to independent support and reallocated the savings to build new customer-facing applications. There are other savings as well, like avoiding expensive forced upgrades. Plus, some independent support providers offer value-added services like performance tuning, interoperability and security support services at no extra cost. Your IT staff benefits as well: Independent support services take over the repetitive elements of database support, letting your in-house database experts focus on supporting new initiatives.
3. Use a hybrid approach: From what we’re seeing in the industry, the most flexible and cost-effective way to optimize your database strategy is to use the right tool for the right job. Keep your legacy databases and gain cost savings and full support through independent support. Next, use alternative databases or even cloud-based databases for new projects.
Such a hybrid approach paid off for BDP International. The company changed its database strategy so that all new development would be on open-source DBMSs, saving the company money while making it more agile. At the same time, BDP moved to an independent support model for its existing Oracle databases.
“We took the money that we had already budgeted for Oracle support and we were able to leverage that to help us build cool new applications to keep our existing clients happy and aggressively attract new customers,” explains Jason Bullock, BDP’s vice president, Global Application Development. “It was a nice way to demonstrate to the organization that we’re thinking outside the box on this and we’re not just going to continue the status quo.”
All in all, when you think about your own database environment, how many instances are in your organization? How many are fully supported? You might be surprised by what you discover. The good news is, you have proven options to support your existing databases – and proven options to launch new ones.
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