Key takeaways
The 8% baseline: Oracle doubled its standard annual fee increase from 4% to 8%, significantly accelerating budget depletion, doubling your fees in just 9 years, compared to 18 years under the old 4% model.
Paying more for less: Many customers pay these rising fees for Oracle Sustaining Support, which excludes new patches, security alerts, and tax updates.
The “all-or-nothing” trap: Oracle’s matching service levels prevent you from dropping support on unused shelfware without repricing your entire contract.
Breaking the cycle: Third-party support offers an immediate 50% fee reduction and typically eliminates the annual inflationary uplift entirely.
The 8% reality
In August 2022, Oracle began notifying customers of a significant hike in their annual support fees, citing global inflation and the rising costs of maintaining high-level security and innovation. While some legacy contracts may still be pegged to lower percentages, the majority of new renewals now reflect this 8% baseline, even in 2026.
With the previous 4% increase, your support costs would double in roughly 18 years. At 8%, your costs will double in just 9 years.
For an enterprise spending $1,000,000 annually on Oracle support, an 8% increase adds $80,000 in year one. By year five, you’re paying nearly $1.47 million due to the compounding effect.
These are fees still being paid for the same software you bought years ago, sometimes without a single new feature being used by your business.
The Matching Service Levels trap
One of the most significant hurdles in managing costs is Oracle’s Matching Service Levels policy. This policy dictates that if you own licences for a specific subset of products (like Oracle Database Enterprise Edition), you must maintain the same level of support for all those licences.
This creates a lock-in. If you have 100 licences but only use 50, you cannot simply drop support for the 50 you don’t use to save money. Oracle’s policies are designed to ensure that if you want support for one, you pay for all. When combined with the 8% annual increase, organisations find themselves paying premium prices for shelfware (software that is owned but provides zero operational value).
The diminishing returns of Oracle Premier Support
Oracle justifies these price hikes by pointing to their Continuous Innovation model and the extension of Premier Support. While long-term support sounds like a benefit, for many organisations, it’s a gilded cage.
Premier Support is designed to keep you on the update/upgrade treadmill. To stay compliant and supported, you must continue to update, which may require hardware refreshes or significant internal resources. If you choose to stay on an older, stable version, you eventually drop into Sustaining Support.
In Oracle Sustaining Support, you still pay that 8% annual increase, but you lose access to:
- New patches and fixes
- New security alerts
- Tax, legal, and regulatory updates
- New certifications
Essentially, you are paying more every year for a service that is providing you with less value over time.
Why automatic renewals are a procurement nightmare
Oracle inserted automatic renewal clauses in its contracts in recent years. While Oracle insisted it was to prevent accidental lapses in support, these clauses are often the primary reason organisations miss the window to negotiate or search for alternatives.
- Lack of visibility: Renewals typically happen at the departmental level, bypassing the strategic oversight of the CFO or CPO until the invoice arrives.
- The 30 to 90-day window: To make any meaningful change to your Oracle estate—whether it’s certifying a ULA (Unlimited License Agreement) or moving to third-party support—you typically need to provide notice well in advance of the renewal date. When the renewal is automatic, that window closes before you even realize it’s open.
- The price list bluff: Oracle sales reps regularly frame the 8% increase as a non-negotiable global mandate. Without a clear strategy and an understanding of your contractual rights, most organisations simply accept the increase as an unavoidable “tax.”
Strategies to combat the 8% increase
If your organisation is facing a looming renewal with an 8% uplift, you have more options than Oracle would like you to believe.
1. Audit your usage
Before the renewal date, perform a rigorous internal audit. Are you actually using the licences you’re paying for? If you find significant shelfware, you may need to look at contractual rightsizing. While Oracle makes it difficult to drop support for partial sets of licences, a complete contract restructure can sometimes result in long-term savings that outweigh the 8% annual bleed.
2. Challenge the standard uplift
Don’t take the 8% as gospel. If your organisation is planning a migration to OCI (Oracle Cloud Infrastructure) or considering a significant new licence purchase, use that as leverage. Oracle is often willing to waive or reduce the annual uplift on legacy support if it means securing a new, multi-year cloud commitment.
3. Consider Third-Party Support
Third-party support is the most effective way to break the cycle. Support Revolution averages 65% less than Oracle annual support fees and offers the flexibility Oracle won’t—like excluding shelfware so you only pay for what you use. Plus, with no annual increases on multi-year contracts, you get the long-term price certainty your budget needs.
4. Certify Your ULA Early
If you are currently in an Unlimited License Agreement (ULA), don’t wait until the final month to decide your next move. ULAs are frequently the source of massive, hidden support costs. Deciding whether to renew or certify out requires months of data gathering.
Silence is approval
Oracle counts on the path of least resistance. For a busy IT department, it’s easier to approve a renewal invoice than it is to challenge a global software megavendor’s pricing policy. But in an era where IT budgets are under constant pressure, an 8% annual fee on legacy software is unsustainable.
The 8% increase is not just a reflection of inflation, but an evidently strategic move to push customers toward the Oracle Cloud (OCI). By making on-premise support prohibitively expensive, Oracle makes the move to cloud look like a cost-saving measure. It’s time to take a proactive stance.
Stop the 8% increase today
Don’t let your Oracle support costs spiral out of control. If you’re facing a renewal and want to explore how to eliminate annual increases and gain flexibility over your shelfware, we can help.
Want to determine your cost savings? Try out our cost-savings calculator today.
