Oracle has changed licensing terms for users of Sun Microsystems' Solaris 10 operating system, reversing a pricing model that analysts said had put the struggling server vendor at a competitive disadvantage with rivals Hewlett-Packard (HP) and IBM.
The changes will lower licensing costs for Solaris users who want to run Oracle's software on only part of their server, a practice called "partitioning."
Previously, Oracle had allowed customers who used certain partitioning technology from IBM or HP to pay only for the processors that they had allocated to running Oracle's software. For example, an IBM customer who allocated 16 processors in a 32-processor machine to Oracle's database would pay licensing fees for only the 16 processors being used. A Sun customer in the same situation would have to pay Oracle's licensing fee for all 32 processors in the system.
Oracle's database has a list price of US$40,000 per CPU (central processing unit) and, with annual support fees added in, the difference in price between these two systems could be enormous.
This put Sun at a disadvantage when it came to partitioned systems running Oracle's database, long one of the most popular applications of Sun's hardware, said Jonathan Eunice, an analyst with Illuminata. "This has been a huge sales impediment," he said.
But over the last month, Oracle has quietly revised its software pricing guidelines to allow Sun users to create Oracle partitions and pay only for the processors they use.
Oracle changed its policy because the Solaris 10 operating system, released earlier this year, is now able to ensure that applications running in Solaris partitions, called Containers, use only the processors they are allocated, said Jacqueline Woods Oracle's vice president of global pricing and licensing strategy.
With Solaris 9's partitioning, Oracle could not be certain that only a fixed number of processors would be used to run its software, she said.
Though licensing prices have been lowered for Oracle products running with Sun's Solaris 10 partitioning software, this is not the case for Oracle software being used with other partitioning techniques, Woods said.
Customers who create partitions using a variety of techniques, including VMware's virtualization software, must still license Oracle software for every processor in their system, she said.
A detailed explanation of Oracle's partition licensing policy can be found here: http://www.oracle.com/corporate/pricing/partitioning.pdf