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The story behind free SQL Server licensing for Oracle users

Microsoft wants to make Oracle customers an offer they can't refuse: free SQL Server licensing if they switch over. The question is whether or not the deal is as good as it looks.

Microsoft's competitive migration offer of free SQL Server licensing, migration support and training for Oracle users ready to switch to SQL Server runs out on June 30.

Bryan Saxton, an account executive at WE Communications, based in Bellevue, Wash., speaking on behalf of Microsoft, described the competitive migration offer as "a new program to help offset the costs of licensing, migration planning and training to help customers modernize their existing applications." It includes free SQL Server licenses, subsidized deployment services and free training materials, including access to SQL Server Essentials for the Oracle Database Administrator training.

To understand the full background of the offer, you have to go back to the Microsoft Data Driven event in March where it was first announced. At the event, Microsoft compared itself with Oracle according to how the two companies priced a two-way server, with eight cores per processor and three years of Oracle or SQL Server licensing and support, along with everything it needed to handle analytics and business intelligence.

 

 Oracle

 SQL Server

 Server with licensing
 and support

 $600,000

 $66,500

 Data warehouse

 $803,000

 $66,500 (built in, so no
  charge)

 Server for data
 warehouse

 $1,272,000

 $133,000

 Advanced analytics

 $1,585,000

 $200,000

 BI for 1,000 users

 $3,745,000

 $320,000

Figure 1: Price comparison from Microsoft's Data Driven event.

While the presentation did not specify which version of SQL Server Microsoft referred to, Saxton explained the prices for the SQL Server product were based on SQL Server 2014.

With SQL Server's total cost looking like a fraction of Oracle's, Microsoft's point is clear: Switching to SQL Server will save money. Oracle licensing experts Craig Guarente, CEO of Palisade Compliance LLC in Mendham, N.J., and former global vice president of contracts, business practices and migrations at Oracle, and Keith Dobbs, director at U.K.-based Madora Consulting, reviewed the numbers.

"These numbers look reasonable in terms of list price," Guarente said. Dobbs concurred, with a caveat. "The prices they are using for Oracle are right in the ballpark for the top range of options." The numbers only make sense if you are comparing SQL Server to Oracle Database Enterprise Edition, he explained. According to Dobbs, if you compare the SQL Server prices to Oracle Standard Edition, the numbers are very similar. However, Microsoft specified the tuning and diagnostics pack as one of the items, and that is only available with the Enterprise Edition.

In response to Microsoft's price comparison, Monica Kumar, vice president of database product marketing at Oracle, said, "We believe that the acquisition price is a very misleading metric." Kumar prefers to look at total cost of ownership, which includes, among other things, the cost of Microsoft's Software Assurance program. Software Assurance is required for Microsoft's free SQL Server licensing, but unlike licensing, Software Assurance is not being offered for free. Microsoft charges organizations 25% to 29% of the software license for coverage.

There are caveats and handcuffs with this agreement that might put customers off.
Andrew Snodgrassresearch vice president at Directions on Microsoft

Andrew Snodgrass, research vice president at Directions on Microsoft, sees things like Software Assurance as a major impediment to Microsoft's efforts to get any traction with entrenched Oracle database users. "There are caveats and handcuffs with this agreement that might put customers off," Snodgrass said.

Penny Avril, vice president of database development for Oracle, said, "I think offering training is not going to get past the bulk of the cost [of migration]." Microsoft spokesman Saxton noted that "the monetary value of these services depends on the market they are utilized in, the customer's existing and new Microsoft investment in licenses, and the customer participation." So, the extent to which these services can make up the cost of migration will vary by customer.

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What do you think of Microsoft's competitive migration offer?
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I'm wary though it looks good on the surface. Nothing is ever as it seems with Microsoft and I have no reason to believe they've suddenly found reason.
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With Microsoft's track record I would proceed with caution. Who's to say when everyone is on board they don't change the rules.
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