Oracle Java Licensing: Covering all Java License Changes

Oracle Java Licensing Summary:

• New 2023 model: License the entire workforce if one employee uses Java.
• Enterprise-wide metric based on employee count.
• License requirements apply to versions depending on their use.
• Audits target compliance and missing licenses.
• Alternatives include OpenJDK or uninstalling Java SE.

Introduction to Oracle Java Licensing

Oracle Java licensing has undergone significant changes recently, particularly with the major shift introduced in 2023. As organizations increasingly rely on Java for their software development and applications, understanding these licensing changes is crucial for maintaining compliance and managing costs effectively.

How Oracle Java Licensing Works in 2023

In 2023, Oracle introduced a fundamental change to its Java licensing model. The new model requires organizations to purchase licenses for their entire employee population if even a single employee or server has installed a licensable version of Java.

This represents a significant departure from previous licensing models and has far-reaching implications for businesses of all sizes.

Key aspects of the 2023 licensing model include:

1. Employee-Wide Licensing: A license is required for the entire workforce if any employee uses a licensable Java version.
2. Version and Security Patch Considerations: Licensing requirements are determined by the specific Java version and applied security patches.
3. Oracle’s Audit Strategy: Oracle has intensified its audit efforts, targeting organizations that have yet to purchase Java licenses.
4. Soft Audit Approach: Oracle often initiates contact through emails, requesting discussions about Java licensing compliance.

Overview of Oracle Java Licensing Changes

Examining the major Java licensing changes Oracle has implemented recently helps understand the current licensing model.

• 2019 Changes
  • Oracle announced that from patch 211 onwards, updates for Java JDK 8 would require a subscription.
  • The introduction of the Java OTN SE agreement also prohibited all commercial usage of Java.
  • These changes were fully effective starting in April 2020.
• 2021 Changes
  • Oracle introduced the NFTC (No-Fee Terms and Conditions) agreement, allowing Java to be used for free under certain conditions from version 17 onwards.
  • The NFTC did not apply to older versions (Java 1 to 16).
• 2023 Changes
  • Oracle replaced the previous Named User Plus and Processor licenses with the “Employee for Java SE Universal Subscription” model.
  • Pricing is now based on the total number of employees, and there are different tiers based on employee count.
  • While the pricing metric has changed, the actual terms of use remain the same.

Types of Oracle Java Licensing Agreements

Oracle has three main Java licensing agreements that organizations need to consider:

• Oracle Binary Code License Agreement (BCL)
  • Applies to older versions and patches of Oracle Java.
  • Allows commercial usage for “general purpose computing.”
  • Requires a Java SE license if the usage extends beyond “general purpose computing.”
• Oracle Technology Network License Agreement (OTN)
  • Applies to Java 11 and Java 17.
  • Prohibits all commercial use of Java.
• Oracle No-Fee Terms and Conditions (NFTC)
  • Introduced in 2021 for Java 17 and newer versions.
  • Allows free commercial usage with some restrictions.
  • Requires a paid subscription for security patches after September 2024.

Do You Need an Oracle Java License?

If your organization has downloaded Java from the Oracle website, you should assume that you need a license unless you verify otherwise. Here are some key points to keep in mind:

• Java has been under a licensing agreement since 2010, but many organizations overlooked this.
• In 2019, Oracle announced that Java updates would require a subscription, marking a major change in how Java was distributed.
• Under the 2023 model, the entire employee population must be licensed if even one user or server needs Java.

Is Java Still Free?

The question of whether Java is still free is complicated and depends on a few factors:

• Java was never entirely free, but earlier versions had fewer restrictions.
• In most cases, companies should have purchased a license years ago to stay compliant.
• Java 17 and newer versions can be used for free until September 2024, but the use of security patches will eventually require a paid subscription.

Oracle Java License Costs and Considerations

Oracle has revised its Java licensing structure significantly over the years, leading to a new employee-based pricing model in 2023. Understanding the Java licensing costs involved, especially when using Java in complex environments like VMware, is crucial for businesses to manage compliance and expenses effectively.

Oracle Java Licensing Costs: Before and After 2023

Before 2023, Oracle offered two main licensing options for Java:

• Java SE Desktop Subscription
  • This license was designed for users accessing Java-based applications.
  • Cost: USD 2.5 per user per month.
• Java SE Subscription
  • This option was intended for licensing servers where Java is installed.
  • Cost: USD 25 per Oracle processor per month.

In 2023, Oracle shifted to an employee-based pricing model. The new model uses tiered pricing based on an organization’s total number of employees.

This change means that even if a small portion of the workforce uses Java, licenses must still cover all employees, significantly impacting how organizations plan their Java costs.

Oracle Java Licensing in VMware Environments

Java Licensing on VMware environments presents unique challenges. Oracle’s position on deploying Oracle JDK in a VMware setup is that if Oracle Java is installed on a virtual server using VMware ESXi 6.0 or newer, organizations must license every physical host in all vCenters.

This approach can lead to substantial licensing costs and complicate compliance.

The licensing procedure for VMware environments can vary depending on the ESXi version.

Organizations must carefully review their Java deployments within VMware to avoid unexpected expenses and ensure all virtual instances comply with Oracle’s requirements.

Oracle Software with Included Java SE Licenses

Some Oracle software products include a restricted-use Java SE license, potentially eliminating the need for a separate Java SE license.

This is an important aspect to consider, as it can help reduce licensing costs if your organization uses any of these Oracle products:

• WebLogic Server (various editions)
• GlassFish Server
• Oracle Business Intelligence products
• Oracle Identity and Access Management Suite

Reviewing existing Oracle licenses to determine if Java SE is included can save your organization from purchasing unnecessary licenses.

Steps for Negotiating Oracle Java Licensing

Negotiating Oracle Java licensing can be complex, but following a structured approach can make the process smoother and help you get the best possible terms. Here is a step-by-step guide to help you navigate negotiations with Oracle:

1. Understand Your Java Deployments
   • Get a clear picture of how Java is used throughout your organization, including which versions and which servers or employees use it.
2. Create a Detailed Java Deployment Report
   • Document all Java installations and uses, including the type of environment (e.g., physical servers, virtual machines, desktops).
3. Calculate Potential Licensing Costs
   • Based on the employee-based model or previous licensing structure, estimate the total cost for compliance.
4. Approach Oracle with Prepared Data
   • Being well-prepared with detailed information about your usage helps create a strong negotiation position.
5. Be Ready to Share Your Deployment Report
   • Oracle may request detailed information during negotiations, so it is important to understand what data you can and should share.
6. Negotiate Based on Employee-Based Metrics or Legacy Metrics
   • Depending on your usage scenario, discuss the possibility of sticking to older metrics or leveraging the newer employee-based model for better pricing.

Oracle Java Audits in 2024

Oracle has ramped up its audit practices, with Java licenses and subscriptions now serving as a significant source of revenue. Organizations need to be ready for two common types of Oracle Java audits that Oracle conducts:

• Soft Audit: This type of audit starts with Oracle contacting organizations to discuss compliance.
• Formal Audit: A more thorough review that examines all Java deployments within the company.

Being prepared for these audits means clearly understanding Java usage and your licensing position, allowing you to respond promptly to Oracle’s inquiries.

The Employee for Java SE Universal Subscription

Introduced in 2023, the Employee for Java SE Universal Subscription replaces the previously named user plus and processor licensing models. This new model operates on an enterprise-wide metric based on the total number of employees, regardless of who uses Java.

Key aspects of this license model include:

• Enterprise-Wide Metric: Licensing is required for the entire organization.
• Broad Definition of “Employees”: This includes full-time, part-time, temporary staff, agents, contractors, and consultants.
• Mandatory Licensing for All Employees: Even if only a fraction of the workforce uses Java, the entire employee base must be licensed.
• Higher Costs: The new model introduces a significant price increase compared to previous licensing models.

Java Pricing Under the New Model

The new pricing structure for Java is tiered, depending on the number of employees within the organization. The pricing details are as follows:

• $15.00 per employee for organizations with 1-999 employees
• $12.00 per employee for 1,000-2,999 employees
• $10.50 per employee for 3,000-9,999 employees
• $8.25 per employee for 10,000-19,999 employees
• $6.75 per employee for 20,000-29,999 employees
• $5.70 per employee for 30,000-39,999 employees
• $5.25 per employee for 40,000-49,999 employees

Free Java Options

For organizations looking to avoid the costs associated with Oracle’s licensing, there are several free Java options available:

• OpenJDK Builds: This open-source implementation of Java SE is free for development and production use.
• Oracle Java 17 and Later Versions: These versions are free under the No-Fee Terms and Conditions (NFTC) license, though security patches will require a subscription starting in September 2024.
• Older Versions of Oracle Java: Some older versions may be free under specific conditions outlined in the Binary Code License (BCL) agreement.
• Alternative Java Implementations: Options such as Eclipse OpenJ9 or Azul Systems’ Zulu Community Edition provide Java implementations that can be used without the licensing fees Oracle imposes.

Licensing Requirements for Older Java Versions

Understanding the licensing requirements for older versions of Java is critical for organizations that continue to use these versions. Oracle has specific licensing requirements for different versions of Java SE, depending on the update level:

• Java SE 6: Licenses are required for updates released after Update 45 (February 2013).
• Java SE 7: Licenses are required for updates released after Update 80 (April 2015).
• Java SE 8: For production use, licenses are required for updates released after Update 202 (January 2019).

Impact on Existing and Potential Java SE Customers

Oracle’s licensing changes affect both existing and potential Java SE customers in different ways:

• For Existing Customers:
  • Oracle requires a license review for any renewals.
  • Customers may need to upgrade to the new employee metrics if any licensing gaps are identified.
• For Potential Customers:
  • The new employee license metric is the only option for new purchases.
  • Alternatives include uninstalling Java SE or exploring open-source options.

Identifying Java Usage in Your Organization

Effectively managing Java licensing starts with clearly understanding where and how Java is used across the organization. Here are the steps to identify Java usage:

1. Inventory All Servers
   • Include physical, virtual, and cloud instances in the inventory to ensure a complete view.
2. Scan for Java Installations
   • Use discovery tools or conduct manual inspections to locate Java installations.
3. Review Application Documentation
   • Look into application documentation to check for Java dependencies.
4. Analyze Application Configuration Files
   • Examine configuration files for any references to Java.
5. Monitor Java Processes on Servers
   • Monitor active Java processes to understand ongoing usage.
6. Engage with Application Teams
   • Collaborate with application teams to gain insights into how Java is being used.
7. Consolidate Findings into a Comprehensive Inventory
   • Gather all findings into a centralized inventory for a clear overview of Java usage across the organization.

Common Misconceptions About Oracle Java Licensing

Oracle Java licensing can be complex, and several misconceptions continue circulating, leading to confusion and potential compliance issues for organizations.

Below, we address some of the most common myths about Oracle Java licensing and explain the realities behind them.

Myth: Java is Always Free

• Reality: While some versions of Java are free, many require licenses for commercial use. Java was initially free for development and limited commercial use, but since 2019, many updates and versions have required paid licenses, especially for production environments. Java 17 and later versions are free under certain conditions, but this depends on the usage and the need for security patches.

Myth: Only Computers with Java Installed Need Licenses

• Reality: Oracle’s 2023 licensing model significantly changed how Java is licensed. Now, licensing is often required for the entire employee population if any Java version is used within the organization. Even if only a few servers or computers have Java installed, the whole employee base may need to be covered under the licensing agreement. This enterprise-wide metric includes all full-time, part-time, and contract employees.

Myth: Open-Source Alternatives Are Always Viable

• Reality: Open-source Java alternatives, such as OpenJDK, can be a great option for many organizations, but they may lack the features, support, or long-term stability needed for certain enterprise use cases. For example, some open-source versions do not include the same security updates, performance enhancements, or compatibility guarantees as Oracle’s licensed versions. Enterprises that rely heavily on Java for mission-critical applications might find open-source alternatives inadequate for their requirements, particularly when they require vendor support or predictable update schedules.

Myth: Small Businesses Don’t Need to Worry About Java Licensing

• Reality: Oracle’s licensing requirements apply to organizations of all sizes. Whether a business is large or small, Oracle Java SE versions that require a license must comply with Oracle’s licensing model. Oracle’s audit practices have increased, and small businesses are not exempt from these audits. Non-compliance could lead to unexpected costs and legal issues, making it crucial for all businesses to understand their Java usage and licensing obligations, regardless of size.

Additional Misconceptions to Be Aware Of

• Myth: Java Licensing is Only About Servers
  • Reality: Java is not just used on servers. Licensing requirements apply to any Java environment, including desktops, laptops, and cloud instances. If an employee’s machine runs a Java-based application, that installation must also be considered for licensing.
• Myth: Licensing Only Applies to the Latest Versions of Java
  • Reality: Licensing requirements also apply to older versions of Java. For instance, Java SE 6, 7, and 8 each have licensing requirements depending on the updated number used. Companies using older Java versions may still be subject to Oracle’s licensing rules, especially if they want to use newer security updates.
• Myth: If You Don’t Update Java, You Don’t Need a License
  • Reality: Choosing not to update Java to avoid licensing costs can lead to significant security vulnerabilities. Many older versions are subject to licensing requirements, and continuing to use them without appropriate licensing could expose your organization to compliance and security risks.

How to Avoid Common Licensing Pitfalls

To effectively navigate Oracle Java licensing and avoid these common misconceptions, organizations should:

1. Conduct a Full Inventory: Regularly inventory all systems—servers, desktops, laptops, and cloud environments—to identify where Java is installed.
2. Understand Usage Requirements: Be aware of how Java is used—whether in production, development, or testing—and determine the appropriate licensing needs for each use case.
3. Consider Alternatives Carefully: Evaluate open-source Java alternatives, like OpenJDK, to determine if they can meet your organization’s needs without sacrificing critical features or support.
4. Stay Updated on Oracle Policies: Oracle’s licensing models and policies can change. Staying informed about these changes helps ensure compliance and prevents unexpected licensing costs.
5. Engage Legal or Licensing Experts: Given the complexity of Oracle’s licensing, consulting with a legal or licensing expert can be a smart move to ensure compliance and avoid costly mistakes.

Oracle Java Licensing FAQ:

What is Oracle’s new Java licensing model?
The new model introduced in 2023 requires organizations to license all employees if even one person uses Java, switching from a user or processor-based model to an employee-based metric.

Do I need a license for older Java versions?
Yes, older Java versions require a license after certain update numbers. Java SE 6 (post-update 45), SE 7 (post-update 80), and SE 8 (post-update 202) all have licensing needs.

Is Java still free to use?
Some versions are free for specific uses. Java 17 and later are free under the NFTC, but certain conditions and limits on security patches apply.

How are Oracle Java licenses priced?
Licenses are now priced based on employee count with tiered pricing that ranges from $15 per employee for small organizations to lower costs per employee for larger organizations.

What are the common Oracle Java licensing myths?
Some myths include the idea that Java is always free, that licenses are only needed on Java computers, or that small businesses don’t need to worry about licensing.

How do I determine if I need an Oracle Java license?
You likely need a license if your organization downloaded Java from the Oracle website. This applies to most updates after Java 8, update 202, especially for commercial use.

What does a soft audit mean for Java licensing?
A soft audit begins when Oracle contacts an organization to review compliance, typically via email, prompting organizations to disclose their Java usage and licensing position.

Can open-source alternatives replace Oracle Java?
Yes, open-source options like OpenJDK can replace Oracle Java. However, they may lack enterprise-level support or certain features, so careful evaluation is needed before switching.

Do small businesses need Oracle Java licenses?
Yes, Oracle’s licensing requirements apply to organizations of all sizes. Even small businesses must comply if using Java versions subject to licensing agreements.

Are there Java licensing options that include support?
Unlike open-source alternatives, Oracle’s Java SE Universal Subscription includes ongoing updates and support, which may not provide vendor-level assistance for bugs or vulnerabilities.

Does the Oracle audit apply to VMware environments?
Yes, licensing in VMware environments can require covering all physical hosts in the vCenter setup where Java is deployed, potentially increasing the cost significantly.

Can I use Oracle Java in production without a license?
Only under specific conditions, such as Java versions available for free under the NFTC or when older versions are used without needing newer security patches.

Are there free alternatives to Oracle Java SE?
Alternatives include OpenJDK, Eclipse OpenJ9, or Azul’s Zulu Community Edition. These open-source versions of Java, including Java JDK and Java JRE, are available without Oracle’s licensing fees.

What are the implications of Oracle’s employee-based metric?
The new licensing metric requires licensing the entire employee base, including full-time, part-time, contractors, and consultants, even if only some use Java.

How can I prepare for an Oracle Java audit?
Start by inventorying all Java installations, understanding how Java is used across your organization, and ensuring you comply with Oracle’s licensing requirements before an audit.