Oracle to Publish Pricing Info on Web

Aug 28, 2002

Michael Chait

Oracle's complicated cost structure may get a little easier to swallow next week, with the world's second largest software company releasing a transparent view of its pricing and licensing on the Web.

The Software Investment Guide, as the company is calling the release, is a global pricing initiative by Oracle to help current and prospective customers better understand and manage their enterprise-wide software costs.

The company, who is battling it out with IBM for the top space in the database market, has come under criticism for confusion over its pricing structures.

The height of this criticism followed an April 17th California state auditor's report which found that a six-year, $95 million, no-bid contract brokered by Oracle and Herndon, VA-based Logicon would have end up costing state taxpayers $41 million instead of saving $16 million for the software, as the groups had led the government to believe.

"It's a good move for Oracle," said Tyler McDaniel, managing director of research and consulting firm, the Hurwitz Group. "Given the bad press they have got, they need to say 'we are going to be straightforward, we are going to be as honest with you as possible.'"

While many tools and application server software have published baseline pricing, when one factors in different licensing, support, outsourcing, consulting, and education options across multiple departments, lines of business and subsidiaries, the schemes can be exceedingly complicated.

The new guide is expected to address many of the complicated issues that emerge in planning software, although some question just how rigid the standards will be.

"In infrastructure software pricing continues to be a major challenge for customers to understand, primarily because there is so much value-based deal making going on that is hard to get repeated pricing," said McDaniel. "For Oracle to come out and publicly say this is going to be our foundation is much needed, but the reality is that when companies get into a situation things get tweaked and software may get added to cut a deal."

The Global Oracle Software Investment Guide will be available at the Oracle pricing and licensing Web site beginning next week.


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