Oracle Compute Cloud at Customer Overview
Today, Oracle announced their new Compute Cloud at Customer (C@C) offering — — so, what is it, how’s it priced and is there any impact on licensing?
Oracle’s Exadata Cloud at Customer offering has been available for a few years now, both as ‘gen 1’ (as in, the first generation) and ‘gen 2’ (thankfully, more ‘gen 2’ than ‘gen 1’!), with some success especially in financial services.
Exadata C@C allows customers to have their database on a managed (by Oracle) cloud platform but, crucially, the machine is situated in the customer’s data centre. Being a ‘database machine’, the only service Exadata C@C can provide is one of a limited number of database services (Exadata C@C, Exadata C@C Autonomous Data Warehouse and Exadata C@C Autonomous Transaction Processing).
Fine — but what happens to the middleware / application servers? Being co-located in the data centre, they’d typically run on ‘on-premises’ hardware owned by the customer.
Compute C@C is Oracle’s offering to provide a protected cloud ‘home’ for these workloads: using the same cloud-in-your-data-centre model as Exadata C@C. You provision virtual machines of the configuration (vCPU/memory/storage) necessary and run your non-database workloads in them. You are provisioning compute (IaaS) services: hence the name. Oddly, Oracle announced ‘Compute Cloud@Customer’ in June 2022 (here) but not much was made of it at the time and it didn’t appear on price-lists : irrespective both offerings appear the same.
The good news:
licensing is no different from IaaS running in OCI
Therefore, it will be BYOL only for any Oracle products you choose to deploy in the compute instances (virtual machines).
Purchasing
Everything about the offering is identical to the Exadata C@C playbook (established since 2018 or so): you lease the hardware from Oracle (typically 4 years) and then buy a ‘pot’ of Universal Credits which are used to run cloud services on the C@C environment. In effect, the C@C cost is a fixed, known price for the term. The Universal Credits, likewise, will have a commitment inherent in the agreement, however your actual usage of these will fluctuate significantly depending on your consumption and management of services. You are ‘charged’ based on the specification of each virtual machine you run, consuming Universal Credits from the overall committed ‘pot’ based on the rate card agreed.
The table below gives a very basic example of the total cost of ownership where the consumption of Universal Credits varies –and the value derived from it. It can be seen that although the commitment of $1M / annum is made at the time of the deal, the consumption can vary wildly and that this has a direct impact on Support Rewards (based on consumed UC) and also the benefit gained (any unused credit is simply lost). I’ve written about Support Rewards previously, here.
The TCO (C@C lease, UC commitment plus overage minus Support Rewards saving (based on consumed UC) is $11.4M vs derived benefit of $10.6M (based purely on UC consumption, Support Rewards (based on consumed UC), and assuming annual allowance of UC credits) –i.e. the customer would have spent $800k more than necessary. Bear in mind that if the customer had consumed exactly the UC committed to, they would have saved another $200k on their support.
As is the case with Exadata C@C, sizing and utilisation is key to getting the best value out of any such investment.
This may be difficult when done in advance and without knowing the performance of your applications on newer hardware.
Like Exadata C@C or Oracle Cloud Infrastructure –the target is for you to buy small and increase the commit / C@C hardware as you need: you should not over-spec the kit or Universal Credits; it’s always hard to pare that back at your next renewal.
Conclusion
There are customers who will benefit from Compute C@C and who have already gone ‘big’ on Exadata C@C — this offering could make sense. Buying C@C or OCI needs care and attention both on the ‘contractuals’ and terms, as well as the pricing and sizing of the infrastructure. As ever, there’s a lot more detail and variation based on particular scenarios and use-case; for example, Dedicated Region may make sense for some customers to get access to wider OCI service offerings.
About the Author
Paul Bullen is a Principal License Consultant at Version 1, having over 22 years of experience in Oracle technology and Oracle licensing.
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