Oracle’s New Java Licensing Changes Could Break the Bank

Oracle’s latest licensing change for Java is certain to create even more confusion on an already problematic licensing model and give even more ammunition for the Oracle sales and auditing teams to attack Oracle customers.

On January 23, 2023, Oracle changed its Java licensing model from processors/named user plus to licensing based on number of employees. Oracle’s new model gives essentially no consideration to the size of the Java footprint in an organization, and it also exponentially increases the cost affiliated with use of Java in small and large organizations alike.  All organizations using a licensable version of Java must pay between $5.25 – 15.00 per employee for Java licenses.  Oracle defines employee for Java licensing purposes as all of the employees of the organization, regardless of employment status, plus all of the full-time, part-time, and temporary employees of agents, outsourcers, contractors, or consultants that support the business.

So any company that wants to use commercial features of Oracle’s Java product must not only calculate all of the employees in its own business, as well as all of the employees of its agents, outsourcers, contractors, or consultants.  Initially, it will be incredibly difficult to get an accurate count of another company’s employees for the entirety of the subscription period.  More importantly, for companies in the business of consulting, the same group of employees may need duplicative Java licenses for each company for whom it consults, resulting in a windfall to Oracle.

If a company is already licensing Java on the old license metrics, Oracle appears to be willing to allow those licenses to be renewed, but offers no guidance as to what will happen if that company needs to increase its license footprint.  A company that must buy Java licenses for the first time will have no choice but to use the new licensing model.

Companies can examine their use cases to determine if there is any way to proceed with Java as a bundled product or find an alternative solution.  Because Oracle often increases its audit activities after a license change, it is a good idea to make sure that your organization is compliant with both the Java and non-Java Oracle environments.  Scott & Scott can help you evaluate your Oracle license compliance quickly and discreetly.  Call one of our licensing attorneys for a fee consultation.