Oracle increases prices on database options

IDG News Service - Oracle has apparently raised the cost of some management options for its flagship database by 40%, according to an official price list dated July 1.

Processor licenses for the company's diagnostic and tuning packs, as well as a database configuration management pack, are now $5,000, up from $3,500 listed on a 2008 price list.

The first two products are meant to help database administrators target and resolve performance problems. The latter tool is used for a range of tasks, such as tracking database configuration changes and ensuring policy compliance.

Meanwhile, a processor license for the enterprise edition of Oracle's database remains priced at $47,500, following a roughly 20% increase last year.

It wasn't clear Thursday whether other Oracle products also have seen price increases. A company spokeswoman could not immediately comment.

It is also not clear when the increases took place, but the lower prices were in effect on a price sheet dated Dec. 1, 2008. Oracle posts its updated price lists on the company's Web site, but does not typically announce when changes are made.

Forrester Research analyst Ray Wang said Thursday his firm began examining the most recent price lists for changes after a sudden swell of chatter from sources in recent days.

Although list prices are rarely what customers actually pay for software, the increases nonetheless raise the starting point for discount negotiations, and could upset customers prepared to buy new licenses even in the face of a global recession.

But there may also be another game afoot, according to Wang.

By raising list prices for licenses, vendors such as Oracle may simply be catering to the needs of corporate IT procurement managers, who are under pressure to get good deals for their employers and whose compensation can be affected by the level of discount they garner from a vendor, he said.

When it comes time to negotiate, the vendor simply agrees to a steeper discount on the now higher-priced product, creating a "win-win" situation for both sides, Wang said.

This is a potential problem for IT organizations, Wang added. "If you just focus on procurement, then you're not focused on the product adoption strategy."