Oracle may be next in EU software licensing hot seat following SAP deal

The European Commission (EC) may be laying the groundwork for an investigation into Oracle's software licensing practices, according to reports. The scrutiny follows the EC's investigation into fellow enterprise software vendor SAP, which ended with the Commission accepting legally binding commitments from the German company to abolish reinstatement fees and reduce back-maintenance fees, among other concessions. MLex is now reporting that the EC - the EU's executive arm - has started to examine Oracle's licensing practices ahead of a possible formal investigation. One source told the publication that the EC was seeking views from third parties. An EC spokesperson told The Register it had concluded an investigation into SAP, and "will continue to monitor possible further anti-competitive practices and abusive conduct in this sector. At this stage however, there is no formal investigation into any company." The Register invited Oracle to comment. Big Red's licensing practices have attracted criticism for years, although the vendor maintains they are fair. One frequently criticized example is its treatment of Java, which came under Oracle's stewardship after it agreed to buy Sun Microsystems in 2009. OpenJDK, the reference implementation of the Java platform, is open source, but vendors can charge for proprietary development kits, runtime environments, and support. Oracle announced a new licensing regime for Oracle Java SE in January 2023. It said Java SE Universal Subscription would offer customers "a simple, low-cost monthly subscription that includes Java SE Licensing and Support for use on Desktops, Servers or Cloud deployments." Industry experts pointed out that even businesses with limited use of Oracle Java could have to pay according to their total employee count under the model, a dramatic departure from Oracle's previous licensing terms. Gartner estimated the per-employee subscription model to be two to five times more expensive than the legacy version. Another licensing mechanism that has attracted criticism is the Unlimited License Agreement. Some licensing advisors claim the all-you-can-eat option offers poor value, locks users in, and limits their choice of alternative products. Oracle maintains that the agreement offers flexibility and good value. The EC accepted SAP's commitments in July after opening an investigation into concerns that the German vendor may have restricted competition in the aftermarket for maintenance and support of its on-premises ERP software. Gartner welcomed the commitments, saying they gave customers more options for their legacy SAP applications by making third-party support a more viable alternative to migration. Vendor support for some older SAP products is due to end in 2027. (R)