Gone are the days when companies used a single database and had a straightforward cost structure, including hardware and software costs and number of users. Today’s cost equation is far more complicated, with IT leaders facing Albert Einstein levels of mathematics to unravel their cost picture, topped off by large, convoluted maintenance fees.
How did IT leaders find themselves here? When you look at the cost equation, it’s not simply one reason. A host of factors are contributing to the hike in costs and blurring the picture. They include:
- Multiple databases. Today companies are likely to have multiple databases that serve different functions or applications, and house different data.
- Expansion of license types. These different databases have varying licensing mechanisms, including traditional, cloud, full open source, and commercial open source. Additionally, dealing with multiple vendors, support structures, integrations, performance tuning, and more can directly and indirectly increase operational costs.
- Complex licensing structures. Many database vendors tout a flexible licensing structure. In practice, that can mean multiple tiers of support, varying pricing models with product complexity and deployment size factoring in. Use cases can be complex, with no two contracts alike.
- Increasing use of the cloud. Use of the cloud is growing sharply. In just the second quarter of 2024, enterprise spending on cloud infrastructure rose by $14.1 billion to $79.1 billion, an increase of 22 percent compared with a year ago.[1] Between storage, compute, and data transfer costs, plus backups and snapshots, use of the cloud can drive up database costs if not properly managed.
- Rising support and maintenance costs. Support from the likes of Oracle has never been cheap. Its support fees sit around 22% of original licensing agreements, on top of an 8% inflationary annual rate (IAR) for software support, enacted beginning December 2022. [2]
IT teams can quickly find themselves dealing with ever-rising support costs, all of which are spelled out in rigid contracts that carry penalties for non-compliance – yet another financial risk.
“The reality is it’s a convoluted cost picture where enterprise IT teams are swimming in support and maintenance costs,” says Robert Freeman, Rimini Street’s Oracle Enterprise Architect.“ Many are paying more than they are even aware of, while Oracle takes in a 90 percent profit margin on maintenance. It’s time to evaluate whether the cost and benefits are there, what to do about it, and how to take control of the cost picture.”
The third-party support alternative
There is a proven solution to the challenge, offered through third parties like Rimini Street. With third-party support services, enterprises can consolidate support contracts, avoid complex structures and inflationary price hikes, saving money that can be invested in innovation.
Rimini Street provides comprehensive support and services to extend the useful life of existing, stable enterprise software applications, including databases, at half the price of the vendorThis allows organizations to focus their IT resources on innovation and transformation investments instead of support contracts.
For renewable energy leader Doosan Enerbility, the savings unlocked by switching from vendor support to Rimini Street for its Oracle Database allowed for the funding of innovations such as robotics process automation (RPA) and other new technologies to help support the company’s mission to bring forth eco-friendly energy alternatives to consumers.
With its recently announced expansion of support offerings, Rimini Street’s third-party support coverage extends from mature Oracle database instances to open source offerings and more than 100 other enterprise software products.
As vendor prices continue to complicate the database cost picture and take larger bites of the IT budget, companies have a greater responsibility to explore what options they have for IT support and services beyond the vendor, protecting the profitability of the business and the resources needed to compete and grow.
To learn more about how Rimini Street can help businesses decrease costs while increasing coverage, go here.
[1] The Register, “Enterprise spend on cloud up sharply as world biz splashes $80B in Q2,” August 5, 2024, https://www.theregister.com/2024/08/05/cloud_market_grows_22_percent/
[2] The Register, “Oracle to hike support fees in line with inflation,” July 25, 2022, https://www.theregister.com/2022/07/25/oracle_set_to_impose_inflationary/
