The latest sign that the traditional software pricing model is coming apart at the seams arrives in a press release today from Oracle. The software giant is rolling out yet another new pricing regime as it tries to adapt to the spread of multicore chips in the various corporate servers which run its software. In the first sentence of the release, Oracle promotes its latest scheme as a manifestation of “its continued commitment to provide customers with simple, flexible and transparent licensing models.”
Simple? Here’s the company’s description of its new policy:
While Oracle will continue to recognize each core as a separate processor, the processor definition has been amended as it relates to counting multi-core chips to determine the total number of processor licenses required. Now, the required processor licensing is dependent upon the specific multi-core chip on which the Oracle software is deployed.
Oracle Processor Licensing: Processor Factor
UltraSparc T1: 0.25
All other Multi-core Servers: 0.75
Single Core Servers: 1.00
For example, if an AMD, IBM, Intel or Sun UltraSparc T1 multi-core server was installed and/or running Oracle software on 8 cores, the licenses would be calculated in the following manner:
— IBM multi-core server — Requires 6 processor licenses (8 multiplied by a factor of .75 equals 6)
— Intel or AMD server — Requires 4 processor licenses (8 multiplied by a factor of .50 equals 4)
— Sun UltraSparc T1 server — Requires 2 processor licenses (8 multiplied by a factor of .25 equals 2)
Oracle’s certainly not the only software house jumping through hoops to retrofit traditional (and lucrative) pricing programs to a world of multicores, virtualization, commoditization, open source and software-as-a-service. At some point, the industry will arrive at a more rational basis for charging (or not charging) for software, one that truly reflects customers’ actual usage and value received. But as the old model goes through its death throes, expect to see more such contortions.