Oracle Third‑Party Support: What CIOs and Procurement Leaders Should Know
Oracle’s enterprise software support fees are a well-known budget burden for CIOs. Oracle typically charges 22% of the original license cost per year for support, with annual increases of 3–8% common. These fees often grow faster than inflation, yet many IT leaders struggle to see proportional value from Oracle’s support.
In fact, Oracle’s support division has an estimated 94% profit margin, underscoring how little of those fees go toward improving customer service.
Meanwhile, Oracle’s policies lock customers in. For example, you cannot drop support on just a subset of licenses in a product family due to Oracle’s “matching service levels” rule. This all-or-nothing approach forces organizations to pay for support even on unused (“shelfware”) licenses.
Against this backdrop, third-party support for Oracle products has emerged as an attractive alternative. Third-party providers like Rimini Street, Spinnaker Support, and others promise to cut annual maintenance costs by 50% or more while offering flexible, customer-centric service.
Thousands of companies – including Fortune 500 firms, government agencies, and mid-market businesses – have switched to third-party support to regain control over their IT budgets and product roadmaps. However, this move comes with important trade-offs and risks.
CIOs and procurement leaders must understand how third-party support works operationally and contractually, how it differs from Oracle’s Premier Support, and the pitfalls to avoid.
This advisory provides a comprehensive look at third-party Oracle support across all major Oracle product lines (Database, E-Business Suite, PeopleSoft, JD Edwards, Siebel, etc.), with an independent perspective focused on customer interests.
What Is Third‑Party Oracle Support?
Third-party Oracle support refers to maintenance and technical support services for Oracle software provided by an independent vendor instead of Oracle Corporation.
In this model, you retain your Oracle licenses (usually perpetual rights to use the software) but terminate or decline Oracle’s annual support renewal, opting to contract with a third-party provider for ongoing support.
The third-party firm then handles your support tickets, fixes, and updates without Oracle’s direct involvement.
Key characteristics of third-party support include:
- Significant Cost Savings: Third-party support contracts are typically ~50% cheaper than Oracle’s Premier Support fees. For example, if you pay Oracle $1M/year, a third-party might charge around $500k for similar coverage. These savings can free up budget for innovation or other priorities.
- Extended Product Lifespan: Third-party providers will support legacy versions of Oracle products well past Oracle’s official end-of-support dates. Suppose you’re running an older Oracle Database or E-Business Suite release that Oracle wants you to upgrade. In that case, a third-party support firm can keep it running with fixes and compliance updates, avoiding a forced upgrade.
- Focus on Stability Over Upgrades: Oracle’s support model incentivizes upgrades (since you get new releases as part of support). Contrarily, third-party support is about keeping your existing system stable and fully operational without requiring upgrades. It’s ideal for organizations that don’t need new features and prefer to avoid disruptive updates.
- Independent Expertise: Oracle’s proprietary knowledge base or development team does not support third-party providers. Instead, they employ former Oracle engineers and product experts and maintain their knowledge repositories to resolve issues. They do not have access to Oracle’s source code or support portal, but they have deep experience in troubleshooting problems on current software versions.
In essence, third-party support for Oracle lets you continue running Oracle software you’ve licensed, but with a different company providing the support services.
You stop paying Oracle for support (avoiding those 22 %+ maintenance fees) and pay the third-party vendor a lower fee to handle bug fixes, troubleshooting, and (in the case of applications) things like tax and regulatory updates.
It’s important to note that third-party support is only viable for on-premises or hosted Oracle software under your control – Oracle’s SaaS products (Fusion Cloud apps, Oracle Autonomous Database, etc.) cannot be supported by third parties since customers don’t have access to the underlying software in those cases.
Oracle Premier Support vs. Third‑Party Support
To make an informed decision, CIOs should understand how Oracle’s Premier Support (the standard support you get from Oracle) compares to third-party support across key dimensions. Oracle’s support is the “official” route with full access to all updates, but it comes at a high price and with rigid terms.
Third-party support offers cost savings and flexibility, but not without limitations. The table below contrasts the two models:
Aspect | Oracle Premier Support | Third‑Party Support |
---|---|---|
Annual Cost | ~22% of license price per year (with ~3–5% annual increases common). Premium for Extended Support on older versions (110–120% of base fee). | ~50% lower cost than Oracle’s fees for the same products. Typically fixed fee or inflation-linked increases, offering immediate savings. |
Patches & Updates | Full access to Oracle’s official patches, bug fixes, and security updates (Quarterly Critical Patch Updates, etc.) for all supported versions. Patches are obtained via Oracle’s support portal. | No access to Oracle’s new patches released after you leave Oracle support. Third-party provider delivers their own fixes or “virtual patches” to address bugs and security vulnerabilities on your existing software version. These fixes can stabilize and secure your system, but they are not Oracle-issued patches. |
Upgrades & New Releases | Entitlement to upgrade to newer versions of the software at no additional license cost (e.g. upgrade to the next major release). Oracle provides upgrade scripts and will support you on the new version if you choose to move up. | No rights to new versions or Oracle-provided upgrades. You generally “freeze” on your current version while under third-party support. If later you decide to upgrade, you’d need to re-subscribe to Oracle support (with back fees/penalties) or purchase new licenses to get the newer release. |
Support Scope (Coverage) | Oracle supports standard product functionality. Issues are addressed if they occur on uncustomized, certified configurations. Custom code or non-standard integrations are not supported – Oracle may ask you to reproduce issues without your customizations. Support covers core product bugs, usage questions, and installation/configuration help. | Third-party support covers the entire environment, including customizations and integrations. Providers will troubleshoot and fix issues in custom code, performance tuning, etc., which Oracle’s support typically refuses to do. They’ll also support older versions beyond Oracle’s End-of-Life. The support is more personalized to your specific environment. |
Service Quality & SLAs | Oracle uses a severity-based response system but offers no guaranteed resolution SLAs in standard contracts. Response times can vary; many customers complain of slow, scripted responses and advice to simply upgrade or apply patches. Support is provided by global Oracle support teams, and cases may be escalated through multiple tiers. | Third-party providers often contractually offer strict SLAs – e.g. 15-minute response for critical issues – and assign a dedicated engineer or small team to your account. Support is 24/7 for critical issues, with engineers deeply familiar with your system. This often leads to faster problem resolution and a higher-touch service experience. |
Knowledge Base & Tools | Customers get access to My Oracle Support (MOS) – Oracle’s online portal with knowledge articles, documentation, community forums, and patch downloads. Oracle’s support knowledge base is comprehensive but sometimes points to lengthy documentation or existing patch fixes. | When you leave Oracle support, your MOS access is cut off. Instead, the third-party firm provides access to its own support portal and knowledge base, drawn from supporting many clients. These providers hire ex-Oracle staff and build libraries of known issue resolutions. The support experience is more consultative – rather than pointing you to an article, the provider often directly assists in applying a fix. |
Security Updates | Oracle delivers official Critical Patch Updates (CPUs) quarterly for security vulnerabilities in supported versions. You get the vendor’s guaranteed fixes for new security issues (plus emergency patches for severe threats when needed). | Third-party providers cannot ship Oracle’s security patches, but they attempt to mitigate new vulnerabilities via custom fixes, firewall rules, or monitoring tools. Many third-party firms have security teams that develop workarounds for security threats (e.g. SQL injection patches at the application level) and alert customers to risks. However, there is a risk of delay or gaps in covering newly discovered vulnerabilities compared to Oracle’s official patches. |
Regulatory & Tax Updates (Applications) | Oracle provides legal/regulatory updates (e.g. tax tables, payroll law changes) for ERP products like E-Business Suite, PeopleSoft, JD Edwards only during Premier/Extended Support phases. Once a product is on Sustaining Support or out of support, these updates stop. | Leading third-party providers create and deliver regulatory and tax updates for legacy Oracle applications to keep them compliant with changing laws. For example, they will update payroll tax rates, financial reporting changes, etc., even for versions Oracle no longer updates. This extends the usable life of Oracle EBS, PeopleSoft, etc. beyond Oracle’s support window. |
Contract Flexibility | Oracle’s support contracts are inflexible: all licenses in a given “license set” must be on the same support level. You can’t drop support on a subset without terminating those licenses entirely. Support renewals often auto-renew annually, and Oracle requires advance notice (often 30-60 days) if you plan to cancel. If you ever need to rejoin Oracle support, you face reinstatement fees (typically back pay for lapsed years + 150% penalty). Oracle strictly enforces policies to discourage lapses. | Third-party support contracts are simpler – you can sign up certain products or environments for support. There’s no concept of “matching service levels” across all your Oracle licenses (since Oracle isn’t involved). Contracts are usually annual and can be renewed or canceled with notice, similar to any IT service. If you later choose to return to Oracle support, you will need to budget for possible fees and negotiations, but you are not contractually locked-in by the third-party provider in the same way. |
Vendor Relationship & Influence | Paying for Oracle support often gives customers a sense of safety – you have the backing of the software’s maker. It also means you have a current relationship with Oracle’s account reps, which can be useful if you plan to buy additional Oracle products or services. Oracle may be more willing to listen to enhancement requests from supported customers, and you get invites to Oracle events, etc. | Moving to third-party support can strain your relationship with Oracle. Oracle’s sales teams often react poorly when a customer leaves support – you might face more aggressive sales tactics or a higher likelihood of license audits. That said, you maintain the right to use your licenses (perpetual means perpetual), and many customers continue to use Oracle technology for years under third-party support. The key is to manage compliance tightly (to avoid giving Oracle any excuse for penalties) and be prepared for a tougher stance from Oracle on other negotiations. |
Table: Oracle Premier Support vs Third‑Party Support Comparison across key factors.
Third-party support offers lower cost and a broader support scope (including customizations and legacy versions), but it also results in the loss of official updates/upgrades and requires careful license compliance management.
Oracle Licensing Entitlements & Restrictions with Third‑Party Support
A common concern is how switching to third-party support affects your Oracle license entitlements. It’s crucial to understand that in most cases, Oracle licenses are perpetual – you bought the right to run the software indefinitely. You do not lose your license by ending Oracle support. Y
You can continue using the software legally without an active support contract if you adhere to the license usage terms (CPU counts, user counts, etc.).
Oracle acknowledges this: even if you’re not paying for support, you still own the license and can use the software (Oracle will just consider it “unsupported”).
However, certain entitlements are tied to being on support:
- Access to Updates and New Versions: Only customers with an active support contract can download Oracle’s patches and new version releases. If you leave support, you lose access to Oracle’s support portal (My Oracle Support) and cannot legally obtain new patches or upgrade binaries. In practice, smart customers will download the latest patches and documentation before their support lapses, to have them on hand. However, any Oracle fixes released after you leave will not be available through Oracle.
- Upgrade Rights: Oracle Premier Support includes the right to upgrade to later software releases without buying a new license. When on third-party support, you forfeit automatic upgrade rights. Should you later decide to jump to a newer Oracle version, Oracle may require you to pay backdated support fees and a reinstatement penalty (typically 150% of the lapsed fees) to resume support. This can erode past savings, so you must weigh the likelihood of needing an upgrade. In short, third-party support works best when you intend to stay on your current version for the foreseeable future.
- Matching Service Level Policy: Oracle’s contracts enforce that all licenses of a given product (a “license set”) must be under the same support status. You cannot pay Oracle for support on some licenses while using third-party support (or no support) on others of the same product family. For example, if you have 100 Oracle Database licenses, you can’t have 50 supported by Oracle and 50 unsupported – it’s all or nothing for that product. If you want to move Oracle Database support to a third party, you’ll likely have to terminate Oracle support on all Database licenses. Some companies reduce license counts (if they’re not using all 100, they might drop 20 licenses entirely to cut costs) – but note that terminating licenses is usually irreversible. Careful planning is needed to identify which licenses you truly need to be supported.
- Audit and Compliance: Switching to third-party support does not protect you from Oracle’s license audits. Oracle retains the right to audit your software usage anytime, even if you’re not a support customer. Industry observers have noted that Oracle sometimes increases audit activity on customers who leave support, presumably to dissuade defections. CIOs should ensure they have robust Software Asset Management in place – verify you’re fully compliant with license limits before you cancel Oracle support. If Oracle does an audit, you must be as clean as a whistle to avoid hefty fines or forced purchases.
- Reinstatement Conditions: If you leave Oracle support and later regret it, Oracle’s official policy is to charge hefty fees to reinstate. As mentioned, they may demand back payment for the unsupported period plus a 50% penalty. In reality, these fees can sometimes be negotiated down if you return (Oracle sales will be keen to win you back), but you should never count on a painless return. It’s better to assume a one-way door plan as if you won’t return to Oracle unless necessary. This mindset will ensure you fully account for long-term needs before leaving.
In summary, your Oracle license remains valid under third-party support, but you effectively enter a “no new Oracle code” zone: you keep using what you have, and a third party helps you manage it.
The main contractual gotchas are the inability to split support across a product family and the financial penalty if you later rejoin Oracle’s support.
Understanding these restrictions allows procurement teams to structure contracts wisely (for example, dropping unused licenses ahead of time, co-terming end dates, and documenting all software assets to survive an audit).
Operational Differences and Considerations
Third-party support changes what you pay and how support works on a day-to-day operational level.
CIOs should consider these differences in support delivery and ensure their organization is prepared to adapt.
- Support Ticket Handling: With Oracle Premier Support, you log issues through Oracle’s online portal and work with Oracle’s engineers according to severity levels. With third-party support, you will typically have a direct line to a dedicated support team. Many providers assign named engineers to your account who become familiar with your environment. Instead of navigating Oracle’s bureaucracy, you often deal with the same expert who can provide continuity. This can expedite problem resolution since the third-party engineer isn’t starting from scratch on each ticket.
- Issue Resolution and Bug Fixes: Oracle’s approach to bug fixes often involves providing official patches or recommending upgrades. Third-party providers, lacking Oracle’s internal patch source, often take a more creative approach: they might develop a custom code fix or workaround for your issue. For example, suppose a particular Oracle E-Business Suite form is malfunctioning. In that case, the third-party support might write a snippet of code to fix the glitch, or provide a script to correct corrupted data, rather than telling you “apply Patch XYZ” (which you no longer can). This custom fix approach can be very effective for keeping older systems running. The downside is that these fixes are, by nature, reactive and case-by-case. You’ll want to ensure the provider documents any changes to your system and that they have a rigorous testing approach before deploying fixes to production.
- Customizations and Integrations: As noted earlier, Oracle Support will not delve into issues caused by customizations or third-party add-ons – they consider that outside their remit. Third-party support, by contrast, prides itself on “one-stop” support for customizations. If your Oracle ERP has dozens of custom bolt-ons, the third-party vendor will attempt to help with any breakage, regardless of whether the root cause is custom or standard code. This is a big operational advantage if you have heavily tailored systems. You won’t get bounced between Oracle and a consultant or told to remove the custom code. Discuss your contract’s scope of custom code support (most providers include it by default). This can significantly reduce downtime when customizations are involved, as the support team doesn’t play finger-pointing games.
- Security Patch Process: A critical operational concern is handling security patches. Oracle’s quarterly Critical Patch Updates (CPUs) cease once you leave Oracle support. Third-party providers address new vulnerabilities using their methodologies. Some will proactively monitor threat intelligence and develop mitigation scripts or instructions (for instance, recommending specific firewall rules, configuration changes, or SQL patches to close a vulnerability). Others may offer auxiliary security services or tools that shield the Oracle application or database at a perimeter level. It’s wise to quiz potential providers on how they handle zero-day vulnerabilities. Do they have a security research team? How quickly have they responded to past Oracle security bulletins? While no third-party can magically issue Oracle’s patches, a good provider will have strategies to keep you secure. In highly sensitive environments, you might consider augmenting with additional security solutions (like a web application firewall, database activity monitoring, etc.) to compensate for missing vendor patches.
- Performance and Tuning Support: Oracle focuses on break-fix issues and known bugs. They generally won’t come and tune your SQL queries or optimize your system, which falls under consulting (for an extra fee). Interestingly, some third-party support agreements incorporate performance tuning help. Since they position themselves as partners in keeping your system running well, they may assist with analyzing performance problems, indexing, configuration tweaks, etc. Be sure to clarify if your third-party provider offers this kind of help. It can add value beyond what Oracle would do without hiring a separate consulting engagement.
- Geo-coverage and Time Zones: Oracle is a global company with support centers worldwide and 24/7 follow-the-sun support for critical issues. Top third-party support firms also offer 24/7 coverage for Severity 1 problems, but if your operations span the globe, ensure the provider can truly support all your regions. Often, third-party vendors have main support hubs in the US and Europe and may cover Asia-Pacific via those or a smaller team. Confirm that their model aligns with your needs (especially for global enterprises that require instant support at any hour).
- Knowledge Continuity: One underrated operational aspect is knowledge retention. Oracle’s support might have hundreds of engineers cycling through cases; you can’t expect the same person to always know your environment. Third-party support, with dedicated teams, can build up a knowledge base about your particular deployment. Over time, they learn your system’s quirks, customizations, and history of issues. This knowledge continuity can reduce resolution times and frustration. It’s akin to having an extension of your IT team that specializes in Oracle software. On the flip side, if you ever decide to switch providers or return to Oracle, you’ll want to retain any documentation and knowledge the third-party accumulated. Ask for documentation on any fixes or changes they make so your internal IT department and any future support team can have that insight.
In summary, the operational experience under third-party support tends to be more personalized and comprehensive for your specific environment. In contrast, Oracle’s support is more standardized and narrowly focused on Oracle’s product as delivered.
Many CIOs report higher satisfaction with third-party support responsiveness and willingness to engage on complex issues.
But to make the most of it, you should adapt your IT processes: maintain good documentation, work closely with the provider’s team, and possibly take on more internal responsibility in areas like security monitoring.
Risks, Pitfalls, and Strategic Considerations
While third-party support can deliver cost savings and service improvements, it also introduces certain risks and challenges.
It’s vital for IT leaders to weigh these factors and have mitigation plans:
- Security and Compliance Risks: As discussed, the lack of direct Oracle patches means you rely on third parties (and your team) to keep systems secure. There’s a risk of a critical vulnerability emerging that the third party can’t patch as quickly or effectively as Oracle would. This could expose your organization to security breaches. This is a serious concern in highly regulated industries or systems with sensitive data. Mitigation strategy: ensure strong compensating controls (network segmentation, strict access control, intrusion detection) and choose a provider with a solid security track record. Also, stay informed about Oracle’s security alerts even if you aren’t getting them directly – you may need to push your provider or take interim steps when major threats arise.
- Dependency on Provider Quality: All your support help will come from the third-party vendor. You could be stuck if they underperform or lack expertise in a particular product. For its faults, Oracle has virtually unlimited resources and access to the actual developers if needed. A third-party firm might not have an answer to an extremely rare, deep product bug. If the provider fails to resolve a critical issue, you may have no immediate recourse (Oracle won’t help you without a support contract). Mitigation: Vet the provider thoroughly, check references, and ensure they have experts for all the Oracle products in your stack (Database, middleware, applications, etc.). Look for providers who have solved issues for clients of a similar size/industry. You might also maintain a small internal capability or consulting arrangement for emergencies, though this reduces cost savings.
- Losing Oracle’s Future Innovations: By stepping off Oracle’s support, you are effectively sidelining yourself from Oracle’s product roadmap. Oracle regularly releases new features, enhancements, and technological improvements (especially now with cloud and Autonomous services). You’ll face a strategic dilemma if a business need arises that could be met by upgrading to a new Oracle version. Resubscribing to Oracle support to get that upgrade may be expensive and time-consuming. Some companies find themselves stuck on an old version longer than they’d like, which can be a competitive disadvantage if rivals adopt new capabilities. Strategically, organizations should consider whether the applications they put on third-party support are in a “sunset” mode (with no major new requirements expected) or if there’s a chance they’ll need modernization. If the latter, perhaps a hybrid approach or a shorter horizon for third-party support is warranted.
- Vendor Lock-In, Ironically: One interesting pitfall is that while third-party support frees you from Oracle’s lock-in on support, you may become dependent on the third-party vendor for bespoke fixes. For instance, if they create a custom patch for you, you’ll rely on them for any updates to that patch. If you ever wanted to return to Oracle support, those custom fixes might not be recognized by Oracle and could be overwritten by an official patch. In effect, you might experience a new kind of lock-in. This is usually less onerous than Oracle’s contract lock-in, but it exists. To minimize this, ensure any custom changes are well-documented and ideally not proprietary to the provider (some providers keep certain tools or code confidential). Negotiate rights to use any fixes or documentation internally should the relationship end.
- Oracle’s Tactics and Pressure: Oracle is notoriously not passive about customers leaving for third-party support. You might experience aggressive retention efforts. Oracle may offer limited-time discounts or negotiate on other deals (like cloud services) if you agree to stay with Oracle support, which could be a benefit if leveraged well. Alternatively, Oracle might play hardball: for example, refusing to grant certain permissive license terms, or being less forgiving in audits. In some documented cases, Oracle’s approach to customers who left has been described as creating a “rougher” relationship. Strategically, CIOs should prepare their executive team for this shift. It can help to communicate to Oracle (when appropriate) that the decision was driven by business necessity, and keep the dialog open for future partnerships (just because you left support doesn’t mean you won’t ever buy Oracle products again). Some organizations use the possibility of third-party support as leverage in negotiations to obtain a better price from Oracle. Just be prepared to follow through, because bluffing can backfire if it’s not credible.
- Internal Skills and Bandwidth: With Oracle support, some organizations tend to “outsource” a lot of the problem-solving to Oracle. When using a third-party, especially if your environment is complex, your internal IT staff may need to be more hands-on in working with the provider. It becomes a collaborative effort. Ensure your team has (or develops) enough understanding of the Oracle systems to work effectively with the third-party support. You may also need to handle tasks Oracle did by default, such as staying current on interoperability notices (e.g., if Oracle no longer supports a third-party product or OS version, how would you know? Make sure the provider covers that or assign someone internally to track it). Essentially, avoid complacency – third-party support is not a full substitute for good in-house governance of your Oracle estate.
Many of these risks can be managed with due diligence and planning. Numerous companies’ experiences have shown that third-party support can be successful over many years, but it’s not a decision to be taken lightly. It should be part of a broader IT strategy, not just a cost-cutting quick fix.
Real-World Use Cases
To ground the discussion, consider a few simplified examples of how organizations leverage third-party support strategically:
- Legacy ERP Extension: A global manufacturer is running Oracle E-Business Suite 12.1, which Oracle has desupported (only Sustaining Support remains, providing no new fixes). Due to cost and disruption, they are not ready to migrate to Oracle Fusion Cloud or upgrade to EBS 12.2. Moving to third-party support, they continue receiving critical payroll and tax updates to their EBS 12.1 system beyond Oracle’s support window. This allowed them to extend the life of a stable ERP for 5+ years, avoiding a multimillion-dollar upgrade project. The savings on Oracle support fees (over 50%) were reinvested into a future ERP modernization fund. When they eventually decide to move to a new platform, they will have saved money and time to do it on their terms.
- Selective Support Optimization: A large retailer heavily uses Oracle Database and Oracle WebLogic middleware, but many of their databases support old in-store applications with no planned changes. They moved those databases (and their associated licenses) to third-party support, saving hundreds of thousands annually. They kept Oracle Premier Support for a few mission-critical databases that they plan to upgrade to new Oracle versions. By doing this, they balanced risk – the systems that remain on Oracle support are those where new features and patches are needed, while the static systems are cost-optimized under third-party care. (This required careful adherence to Oracle’s matching service level policy by separating license sets – in this case, the retailer segmented their environments under different customer identifiers to satisfy Oracle’s rules, a complex but feasible workaround with legal guidance.)
- Database Security Focus: A financial services company on Oracle Database 11g (long out of Oracle support) wanted to avoid an expensive upgrade to 19c. They went with third-party support for 11g. A key concern was security, so they subscribed to the third party’s additional security service: the provider supplied a tool that monitors database traffic for attacks and regularly backports security fixes when possible. The firm also hardened its network and OS around the database. Over 3 years, they experienced a few Oracle security alerts (e.g., for new SQL injection vectors); the third party sent timely advisory notices and mitigation steps for each. While not ideal as applying Oracle’s official patch, the mitigations kept them safe. This example highlights that even security-sensitive industries can manage the risks with proper planning, though it requires vigilance.
- Cost Diversion to Innovation: A public sector agency faced stagnant budgets and had to choose between funding new digital initiatives or maintaining full Oracle support on a portfolio of older PeopleSoft and JD Edwards systems. They chose third-party support for those ERP systems, freeing up 60% of the previous support costs. The savings were diverted to new citizen-facing digital services. The agency noted that user satisfaction with support improved due to more personalized service from the third-party vendor. They acknowledged the trade-off (no new Oracle features), but since those systems were in maintenance mode, it was an acceptable compromise to drive innovation elsewhere. This case underlines the common scenario: third-party support as a lever to fund higher priorities when IT budgets are tight.
Each organization’s context will differ, but the common theme is evaluating where Oracle’s constant upgrades and support fees bring value versus where a “run stable and save money” approach makes more sense. Third-party support can be a strategic tool in the CIO’s toolkit, especially for legacy and mature systems.
Recommendations
For CIOs and procurement teams considering or evaluating third-party support for Oracle, here are specific actionable recommendations to guide your decision-making:
- Assess Your Oracle Landscape: Perform a thorough inventory of your Oracle software portfolio. Identify systems that are stable and mature (minimal change, primarily maintenance mode) versus those that provide a competitive advantage or require frequent updates. Third-party support is usually best suited for the former—e.g., an older ERP, a database for a legacy app, or any Oracle product you don’t plan to upgrade soon. Create a shortlist of candidates who could move to third-party support without harming business objectives.
- Calculate the True ROI: Build a business case that includes concrete cost savings (compare the third-party provider’s quote to Oracle’s renewal quote over, say, 5 years, including Oracle’s annual uplifts). Also account for one-time costs: perhaps you need to spend effort on knowledge transfer, patch downloads before expiry, and any additional security tools. Factor in potential reinstatement costs if there’s a moderate chance you’d return to Oracle (though plan to avoid that). The goal is to show net savings and payback period. Many organizations see immediate savings of 50% yearly, but ensure no hidden costs eat into that (like needing extra staff or consultants for things Oracle used to do).
- Review License Compliance and Terms: Before canceling Oracle support, ensure you are 100% compliant with your license usage. Remediate any unlicensed use (either remove it or buy the necessary licenses). At the same time, you still have Oracle’s ear – it’s better to sort it out during a renewal negotiation than during an audit after you’ve left. Check the matching service level policy implications: you may need to remove (terminate) some unused licenses to avoid paying support on them. Work with a software licensing advisor or legal counsel to document any license terminations or changes properly. You want a clean break with no loose ends that Oracle could use against you later.
- Engage Stakeholders and Communicate: Bring in all stakeholders early – security teams (to address patch concerns), application owners (to confirm they don’t need new features), and executive sponsors/CFO (to support the cost-saving plan). Be transparent about the trade-offs: for example, “We will not get new features on PeopleSoft, but we plan to replace that in 3 years anyway, and we’ll save $X million, which can be invested elsewhere.” Everyone on the same page ensures you won’t face internal resistance after switching.
- Evaluate Providers Rigorously: Not all third-party support vendors are equal. Issue an RFP or conduct a detailed evaluation focusing on experience with your specific Oracle products (database, middleware, and each application), their SLA commitments, security practices, and client references. Interview their support engineers if possible. A key question: have they supported customers through the specific scenarios you anticipate (e.g., keeping EBS 12.1 running through regulatory changes in your countries)? Also, clarify what is not covered (for instance, will they support performance tuning, Disaster recovery assistance, etc.). Choose a provider you feel confident can be a true partner, not just a help desk.
- Plan the Transition Meticulously: Switching support isn’t just signing a new contract. Plan for a period of knowledge transfer and preparation before Oracle support expires. This includes downloading all relevant Oracle patches, updates, and documentation that you might need in the future (since your access will be cut off) – essentially, build an archive. Oracle’s support site allows downloads of patches you’re entitled to, such as the latest bundle patches, CPU patches, installation media for current versions, etc. Additionally, document your system configurations and customizations thoroughly for the new provider. Set up connectivity and tooling with the third-party (they may require certain remote access or monitoring tools to be installed). A well-managed handover will prevent any lapse in support quality.
- Strengthen Security and Monitoring: Given the heightened importance of security when not receiving Oracle’s official patches, invest in your security posture. Ensure systems are on supported OS versions (the OS vendor patches still apply), databases are behind robust firewalls, and consider additional intrusion detection or vulnerability scanning focused on Oracle tech. Some third-party providers include security add-ons – evaluate if those are sufficient or if you need independent tools. Assign responsibilities: who watches for new Oracle security advisories (you, the provider, or both)? Have an incident response plan that accounts for a possible security issue on an unpatched Oracle system. In short, mitigate proactively so you don’t suffer a breach that could have been prevented with an Oracle patch.
- Maintain Oracle Relationship (Selectively): Even if you leave Oracle’s support, you might still buy other Oracle products or use Oracle cloud services. It’s wise to maintain a professional relationship with Oracle. Inform your Oracle account manager of your decision not to renew certain support contracts (you don’t owe them deep details, but a heads-up is better than a surprise non-renewal). This decision was driven by cost constraints and specific product strategy, not an overall divorce from Oracle. This can keep the door open for more amiable dealings in the future. Also, keep an eye on Oracle’s product roadmap announcements; just because you’re off support doesn’t mean you should ignore what Oracle is doing. There may come a time when a new Oracle offering is worth your consideration, and you’ll want to be up to date.
- Document Everything: Rigorously treats the third-party support arrangement as any critical IT service. Document the contract terms, the provider’s, and your internal responsibilities. Also, document any fixes or patches the provider gives you (have them provide readme notes or code annotations). Maintain an internal knowledge base of issues and solutions under third-party support. This will be invaluable if key personnel leave or if you ever switch providers or transition back to Oracle. Good documentation is part of your continuity plan.
- Plan for an Exit (just in case): While you might be very satisfied with third-party support, circumstances can change. The provider could be acquired, or Oracle might make unexpected moves (for example, drastically dropping support prices or offering a bundle that makes financial sense to return). Have a contingency plan for how you would revert to Oracle support or another option. This means keeping your Oracle CSI (Customer Support Identifier) details handy, knowing what versions you’d likely upgrade to, and reserving some budget for a possible Oracle re-entry if ever needed. Having this plan on the shelf ensures you’re never caught flat-footed.
By following these recommendations, CIOs and procurement leaders can approach the third-party support decision in a structured, risk-aware manner.
The key is to balance cost savings with your Oracle environment’s operational and strategic realities. Many organizations have found that with due diligence, third-party support delivers substantial value. It empowers IT departments to redirect funds to innovation and get more personalized support for legacy systems.
But it requires going in with eyes open: understanding what you give up (Oracle’s updates and roadmap) and implementing measures to compensate for those gaps. With careful planning and the right partner, third-party Oracle support can be a savvy move that aligns with fiscal responsibility and reliable IT operations.