Got a killer Microsoft or Oracle cloud deal? Start sweating

Big boys snare the unwary with too-good-to-be-true deals


Not just Microsoft - Oracle's at it too

Getting oversold on cloud has been happening in the Oracle world, too. How much cloud is Oracle throwing at customers? Spithoven knows of one unnamed customer who’d undergone an Oracle software audit and was found to have a “compliance issue” of 2.5m euros. In return for swallowing three years of Oracle cloud services, the software bill was cut to 200,000 euros.

What might seem like a great deal up front, or in the short term, contains hidden pain. Going cloud isn’t a case of easily changing platforms at the flip of a button: it’s an IT transformation project requiring profound strategic and detailed tactical action.

Failure to appreciate this means you can end up switching off the old Oracle licenses before you’re ready and then having to re-activate them – at the new prices.

The problem lies in knowing what apps and modules customers are running and which work with the 12c multi-tenant database that now runs Oracle’s cloud. The average customer runs between 600 and 800 apps and not every application will yet support Oracle’s database. If you’re running one of those apps you’re in trouble. Even more so if you’re running an old version of an Oracle app.

Spithoven has spent a lot of time working with Oracle customers who signed up to Oracle cloud services and realize too late they are running Oracle 8, 9, 10 or 11 and then need spend time and money getting on the newest versions that will run in the cloud. That means getting your apps working on Database 12c in the first place.

“There are benefits of going to the cloud but what you see are customers who move to cloud and then they get confronted with the fact their IT infrastructure is not ready,” Spithoven said. “It results in the fact the customer wants to use their cloud subscription but it’s only valid for X years, so they need to speed up the whole migration internally.”

Also, he notes, some are rushing into cloud and switching off their on-prem license with disastrous consequences for the IT budget.

“I’m seeing customers buying cloud who are not familiar with what’s available on premises, then moving to cloud and cancelling their on premises license,” he said. “Then they are confronted with the fact they want that functionality and the have to pay more.”

So, how do you avoid getting taken for a ride by sales people offering deals that are too good to be true?

Before you go even remotely near anything labelled “cloud” have an IT strategy that includes the cloud services you want to start using. Next, have a deployment roadmap. Specify which devices you will use or are entitled to, and find out what you need to get there and make it happen.

Also, be clear what it is you are and aren’t entitled to use under your existing license and also under the proposed new cloud license. Once you’ve signed, monitor your entitlements on a regular basis as vendors can, and do, change their terms. Also, monitor consumption of services, in order to stay honest and to have the facts at your fingertips when the inevitable audit does materialize.

Think that’s a no brainer?

DeGroot reckons 15 per cent of his clients can’t produce a good list of the Microsoft products they’ve used – and that’s a problem, because it gives Microsoft the upper hand during audits. He’s been working with one client for eight months to produce a list.

So, sure, swallow up the free stuff now – but you will pay later, and quite likely more than you’d reckoned on once the vendor’s audit team has called. When that happens, it’s no good complaining that you weren’t told or didn’t know.

“The important thing is for the end user to do their corporate due diligence before entering into a corporate agreement,” Spithoven says.

“Know exactly what you are dealing with.” ®


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