Oracle's response to questions from CIO.com about its VM licensing was an e-mail with the following links to descriptions of its license pricing, both alone and with Virtual Iron products.
"This is not a new issue with Oracle," according to Gordon Haff, analyst at Illuminata. "People were complaining about Oracle pricing since long before virtualization came around. So the acquisition of Virtual Iron is more an acknowledgement that virtualization is key, not something that's going to get them to change faster. "
Oracle will, inevitably, change its licensing to be more friendly to virtual infrastructures, Haff says, because it has no choice. All software is going to have to be priced in a way that is flexible enough for virtualized infrastructures, he says.
Right now, however, Oracle's refusal to license its software to movable VMs is evidence the company has "seen the potential for lost revenue and taken steps to prevent it before that happened," Wolf says.
"You compare that to a company like Novell-which redefined its OS licensing to let you get a subscription for a physical server and apply it to an unlimited number of virtual machines on that server," Wolf says. "Novell had close to a double-digit market-share gain in OS revenues last year because of that. They did very well by aggressively structuring licensing to take advantage of virtualization."
It's not good that Oracle is trying to stave off any impact virtualization may have on its revenues, but it's no surprise, either, Haff says.
"Oracle was one of the last major vendors to recognize and make accommodations for multicore systems as well," Haff says, referring to the early years of this decade, when Oracle, Microsoft and other server-software vendors tried charging per core and per processor as a way to increase revenue as the power of servers expanded and the number of them in data centers shrank. "[Oracle] still has this rather complicated pricing scheme that's a throwback; there are different multipliers for different kinds of processors, depending on what used to be called power factors."
It's not just the unfriendly pricing that's the problem, Wolf says. It's Oracle's almost sullen silence on the issue.
After Wolf wrote a blog post saying that, within limits, Oracle would provide de facto support for any vendor's hypervisors-a conclusion he reached after interviews with many Oracle executives- and pointing to a document confirming it, Oracle changed the document.
"They changed the whole article to say they would not support x86-based hypervisors," Wolf says. "To me that speaks for itself. It's not favorable to customers when software vendors do those things."
Burton Group has been advising clients to use databases or applications from other vendors where that is practical, though Wolf acknowledges he hasn't seen a major migration away from Oracle because of its VM licensing.
"In fairness to Oracle," Haff says, "it makes the kind of big applications that are among the last things in an enterprise to be virtualized. So you can overstate the impact of this. And a lot of Oracle's larger enterprise customers have various forms of site licensing, so per-core pricing and VM pricing wouldn't really change anything for them. "
That doesn't mean Oracle isn't being unresponsive or that it won't eventually have to change its licensing to follow the practices of its customers, however.
"They're not really going to have a choice, but right now it seems as if they're resisting making changes that will upset their current revenue stream," Haff says. "The bottom line is that Oracle is doing what it thinks is best for Oracle."
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