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Oracle hits users with 40 percent price hike

Company quietly raises the prices of several modules

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Oracle has bumped up the cost of some management options for its flagship database by 40 percent, according to the latest official price list.

Processor licences for the company's diagnostic and tuning packs, as well as a database configuration management pack, are now US$5,000(£3,040), up from $3,500(£2,130) 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 licence for the enterprise edition of Oracle's database remains priced at $47,500, following a roughly 20 percent increase last year.

It wasn't clear whether other Oracle products also have seen price hikes. 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 1 December, 2008. Oracle posts its updated price lists on the company's website dated 1 July, but does not typically announce when changes are made.

Forrester Research analyst Ray Wang said his firm had begun 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 licences even in the face of a global recession.

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

By raising list prices for licences, 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 organisations, Wang added. "If you just focus on procurement, then you're not focused on the product adoption strategy."



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