This post has already been published in the past on the AMIS technology blog.

Once in a while a company wants to know if her Oracle development- and test- environments needs to be licensed. And in a lot of cases this question simply can be answered as: yes, these environments must be licensed. The cases in which these licenses are not needed, are quite rare and a company should verify this with her Oracle representative or an intermediary.

Recently I bumped into such a lucky company, and I thought it’s a good reason to write about this. And as always when talking about licenses please take notice of the disclaimer in this article.

In this post I will first shortly point out why development- and test-environments need to be licensed according to Oracle, try to explain the ‘OTN Development license’ , describe the case of the lucky company and point out some consideration to make the costs of the environments maybe more bearable.


Why pay for these environments.

The Software Investment Guide states the following :

Any person doing development work using the software must be licensed” and “Any Oracle software used in test/staging environment must be properly licensed with a Full Use license under an Oracle License and Services Agreement (OLSA) or other appropriate Oracle (or Oracle authorized reseller) license agreement.

These sentences are quite clear I think, but the confusion within development environments is mostly about the term ‘OTN Development License’:

OTN Development License.

The already mentioned Software Investment Guide states about this:

Oracle software may be downloaded for limited development work via the Oracle Technology Network (OTN). Software downloaded from the OTN Website is governed by a special agreement called the OTN Development License. This agreement grants the individual the right to use the programs only in a development environment; licenses obtained under this agreement may not be used in test, production, fail-over, or any other environments.

In short: whenever you are planning to go into production, you’ll have to pay.

Under this license it’s allowed to download and investigate the product for your own use. However there’s a thin line, a grey area as you wish. What about a Proof of Concept you want to perform? According to the database licensing document only one person may use the software:

It also limits the use of the downloaded product to one person, and limits installation of the product to one server. Customers may not use products licensed under the OTN Development License in connection with any classroom activity, internal data processing operations, or any other commercial or production use purposes.

It depends also on what kind of POC you are planning to do. E.g. if you are investigating the possibilities of multitenancy in 12c, Oracle will likely not oppose to that. Also the period of the proof of concept is important. When you’ve got a good understanding – relationship with Oracle as you wish – there are possibilities to agree upon for a period of performing a POC.

Free development and testing.

When you are an ISV (Independent Software Vendor) who develop, and release there software to customers who bought their own Oracle Full License, and as a result of that don’t  run their own software in production, you don’t have to pay.  Also when your company in this case  distribute the software under the ASFU-agreement (Application Specific Full Use Licence – integrated in the product, sold by the ISV) , you don’t have to pay for their development and testing environment.

But – there’s always one –  when this software is hosted, and you provide this as a hosted solution, you’ll have to pay for your development and testing environment.

In case there’s a mix, e.g. developing software to customers on premise and provide the same software as a hosted solution, the company has to be able to present a clear calculation of seperating these solutions.

Important: when you think you’re a lucky company too, check this with your local Oracle sales, or ask an intermediary like us (Smile) for a pre-check if you don’t want to alarm Oracle LMS.

Controlling the license-costs of your development and testing environment.

The following list is not exhaustive, tips are welcome.


  • Of course, license through Named Users instead of Processor.
  • Consider short term licenses. When starting a project with a scope of one year, consider buying licenses for 1 or 2 years.
  • When outsourcing  a project, consider using the licenses of the outsourcing company, or choose to let them use your own licenses (through an internal agreement – it’s possible). Whatever is cheaper. Make it part of the outsourcing deal.
  • Consider the use of public cloud solutions as Amazon and Azure. The concept of Bring Your Own License, but you only have to pay for the virtual cpu’s. Oracle FAQ’s about this: (beware, Oracle AMIs has nothing to do with the company I work for .. ). Amazon and Azure are at this moment the ‘Authorized Cloud Environments’ ( ).
  • Consider using Oracle Database Appliance. Especially when the development needs Enterprise Edition too.  Oracle Database Appliance is scalable (you only pay for what you’re using) and it’s possible to license the database- and weblogic-instances on Named Users in stead of Processor-based.
  • Consolidate, in combination with Oracle VM, especially when using options in your database.
  • When reading this list you may notice that this is not always about licensing, but sometimes it means a redesign of your architecture of your complete Oracle environment, because your development and testing environment has to fit in the rest of the architecture. A kind of ‘Architecture by licensing’. The scope therefore should not be limited to your development environment only. And before you start such a proces, be aware of the following pre-requisites:imageI hope this post helps in understanding how to cope with the Oracle licensing rules in some cases.

    The material presented is based on the author’s best effort, and meant for advisory purposes. The use of this material is at your own risk. The author denies any responsibility for any damage that could occur through errors in this material.