back to article Firefighters choke on Oracle's alleged smoke-and-mirrors cloud

Oracle has been sued by a pension fund that claims the database giant exaggerated its cloud business revenue. The City of Sunrise Firefighters' Pension Fund filed its lawsuit in a US district court in Silicon Valley against not just Oracle but also executives Safra Catz, Mark Hurd, Larry Ellison, Thomas Kurian, Ken Bond and …

  1. Tinslave_the_Barelegged

    Software audits

    I never did understand why the risk of software audits (remember the FAST wars?) did not kill proprietary software, as the risk to business is so high, not just financially, but reputation risks too. Perhaps it's because licence compliance sounds simple and benign, rather than the minefield and constantly moving target greed has made it.

    Historical examples: I can certainly recall that the final and biggest reason for migrating from Netware to NT networking was the fact that the licence restrictions were non-existent in comparison with Novell's draconian rules. Also, we first started looking at Linux at a time when adding a single login to a Sequent Dynix ptx system costs thousands. Some infrastructure development needed at that time was nearly prevented by the cost of the development logins, so I did the research on Linux instead.

    1. Anonymous Coward
      Anonymous Coward

      Re: Software audits

      The risk of software audits doesn't scare management, which makes sense. They think "yeah, obviously if we are stealing software... that will be an issue." It is much scarier for them to use some open source alternative, assuming it isn't mainstream like RHEL, and then have to explain to the CEO that the issue was caused by them going off the beaten path with OSS instead of using a familiar name like Oracle, MS, etc.

    2. Anonymous Coward
      Anonymous Coward

      Re: Software audits

      Oracle licensing is so damn complicated when it comes to little details (which of course still can cost you millions) that I've never met any CxO level manager who would understand a thing from it. The moment they realize how deep in turd they are in (and I was unlucky one doing the explaining couple of times) they start waving hands and shouting - but usually there's no other way than keep paying. Although I was part of the license optimization projects which were able to save many millions per year in oracle maintenance payments. I think there's no single company in the world which is of certain size (Fortune 500 let's say), which uses Oracle databases a lot and which would come clear from license audit. There is just no way if you are running couple of thousand servers to be 100% compliant.

      Cloud sales: I wouldn't believe that, I thought it's anti-Oracle prejudice, but I got such offer myself last year. We were buying new licenses, Oracle sent us ridiculous quote, at least twice as high as usually. When asked why it's so damn pricy, they offered us that we can have it for 1/3 of this price if separately we spend 20 grand on 1-year IaaS licenses in their cloud. No problem that we have 100% on premise policy and we are not going to use any cloud. They didn't care and it wasn't a problem that we said at once that we will not renew them when year will pass. No problem, just buy them they said. So of course we did, we would be stupid not to.

  2. This post has been deleted by its author

  3. Giovani Tapini Silver badge

    Ahhh, the Oracle we all know and love

    The pitch "unprecedented level of automation and cost savings," and to the company being "customer-focused" and "intimate partners with our customer."

    The reality, threats of audits, exorbitant costs via impenetrable licencing rules, and the, go cloud or go away tactic Microsoft has been dancing round for a while.

    What could possibly go wrong...

    Also 143m seems quite a low number for the type of fund. CBA to look it up but I would have expected more like a 1.4bn. especially if they have to fund against Oracle lawyers...

    1. Lusty

      Re: Ahhh, the Oracle we all know and love

      "go cloud or go away tactic Microsoft has been dancing round for a while"

      In what way? MS still offer all of their on prem software and have not adversely changed the pricing model as far as I can tell. Naturally all of the marketing is going into the new stuff, but on prem is still actively developed and released on a slightly slower cadence than the cloud (at customers request!). I'm not trying to big them up here but I'd be curious to know how you think MS are doing this?

      1. SecretSonOfHG

        Re: Ahhh, the Oracle we all know and love

        In my experience, limited of course to some products, MS has also used license audits -or rather the veiled threat of them- as tool to steer customers towards whatever was their sales interest at the time.

        1. Wedgie

          Re: Ahhh, the Oracle we all know and love

          It's standard practice from what I've seen with the big boys.

          Fail licence audit - repay & also buy licenses for new cloudy stuff to the value of the deficit. Kerching, more maintenance fees.

      2. Anonymous Coward
        Anonymous Coward

        Re: Ahhh, the Oracle we all know and love

        MS is worse than Oracle with software audits. They call them software asset management engagements, as though they are helping you manage your assets. They are completely routine. Agree with OP that they are pushing cloud too very aggressively, e.g. the price of O365 being the same or less costly than on premise (for the first go around, and then the prices increase). MS is probably going to get in trouble for inflating cloud numbers too as, in many cases, people move to O365 but literally nothing changes... and MS then counts all those copies of Office on your PC as "cloud."

        1. Anonymous Coward
          Anonymous Coward

          Re: Ahhh, the Oracle we all know and love

          "MS is worse than Oracle with software audits. They call them software asset management engagements"

          A SAM is different to an audit. In a SAM you self report using SAM tooling in order to do an effective true up on your EA. Usually a SAM is done every 3 years or so to allow IT to see what is running more than anything (shadow IT and all that). In an audit an independent auditor verifies your numbers for you - generally these are only done if there is suspicion of fraud so not often since MS are generally quite easy going with licensing if you're in the right ballpark. Neither case includes changing prices or special offers to get you to change product, the prices are what they are and your usage is what it is.

          Oracle on the other hand...

    2. Mark 110

      Re: Ahhh, the Oracle we all know and love

      "Also 143m seems quite a low number for the type of fund"

      You made me look it up . . . . $147,902,939 under management.

  4. Anonymous Coward
    Anonymous Coward

    Why did I suddenly start singing...

    Burn Baby, Burn!

    Would be very appropriate given the parties involved, and justice server.

  5. Anonymous Coward
    Alert

    Hands up ...

    ... anyone who thought Oracle likely to become the Good Guy - or at least Innocent Party - of a dispute ... ?

    I guess in retrospect it was inevitable. Noone is immune from US lawyers.

  6. Doctor Syntax Silver badge

    "against not just Oracle but also executives Safra Catz, Mark Hurd, Larry Ellison, Thomas Kurian, Ken Bond and Steve Miranda, citing allegations of fraud."

    Suing the named execs I can understand. But, assuming they still hold shares, they are part owners of Oracle. Why are they suing themselves and their fellow (alleged) victims?

  7. EJ

    "In truth, Oracle drove sales of cloud products using threats and extortive tactics,"

    Welcome to Oracle's business model!

    1. Anonymous Coward
      Anonymous Coward

      'Welcome to Oracle's business model!'

      Larry must miss the glory days when he was front-page cover material... Pouncing around his multiple Japanese-style garden homes pontificating about expunging the competition. Since the early 90's, Oracle sales tactics have basically been Mafia-like apply thumbscrew pressure. Seems like its catching up with him!

  8. Aladdin Sane Silver badge

    "customer-focused"

    Should've set off alarm bells straight away.

    1. Anonymous Coward
      Anonymous Coward

      Re: "customer-focused"

      Oracle are extremely customer focused.

      Not in the "lets help the customer" way. In the "how can we fuck over this customer even more?" way.

  9. Anonymous Coward
    Anonymous Coward

    Don't mention testing

    If you are interviewing to work for Oracle cloud. It killed the conversation.

  10. Anonymous Coward
    Anonymous Coward

    '"The suit has no merit and Oracle will vigorously defend against these claims," said Deborah Hellinger, head of communications for Oracle, in an email. '

    Presumably she has that set as her auto-reply to all her press contacts.

  11. Anonymous Coward
    Anonymous Coward

    As someone who worked for Oracle Hospitality, I can say that the tactics displayed at AE were how we were meant to sell. Effectively, tell the customer that their existing HW would be out-of-support, scare the shit out of them with FUD and, if they still were hesitant, talk about audits.

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