Lures and Traps of All-You-Can-Eat Software License Agreements

For those of you who have dined at a buffet or all-you-can-eat restaurant, there’s a good chance you’ve fallen into one of the following “traps”:

1. Consumed less food than what would represent a fair price to pay
2. Consumed more food than you need or want, in pursuit of value or just because you can

These traps translate surprisingly well to all-you-can-eat software license agreements such as Oracle’s Unlimited License Agreement (ULA) and SAP’s Unlimited During Deployment (UDD) agreement.

The first trap illustrates the need for accurate and realistic planning. All-you-can-eat agreements typically assume rapid growth in the utilization of the vendor’s software, and organizations should exercise caution before entering into a lengthy contract where growth assumptions have not been thoroughly validated.

The second trap is more subtle, because there is no obvious downside to over-consuming software during the period of the agreement. However, upon expiry the organization is left with a license for all software currently deployed within their organization which can lead to ongoing maintenance obligations that far exceed the actual use of the software.

A common misconception of all-you-can-eat agreements is that they remove the need for scrutinizing software deployments and utilization. This couldn’t be further from the truth, particularly as the agreement approaches its expiry date when organizations must optimize their software license consumption to ensure that their ongoing maintenance payments are based on real use and not due to unnecessary over-consumption.

All-you-can-eat software license agreements can offer real value for organizations with a genuine need to rapidly accelerate their use of a vendor’s software, as long as there is an active awareness and understanding of the associated traps.

Note: Oracle License Management Services provides ULA Services to help organizations better understand their usage of Oracle products under the ULA.