For many organisations, Oracle software is an integral part of their enterprise software. While the initial licence investment is a major milestone, the long-term financial commitment lies in the ongoing support fees. These costs are often treated as a predictable, fixed operational expense – a necessary price to pay for stability and security.
However, a closer look at the data reveals a different story. For many customers, the cost of maintaining the status quo is rising at an accelerating rate, often outstripping the actual inflation of the broader market and the value derived from the software itself.
In this blog post, we examine the two primary mechanisms driving this "silent" cost growth: the 8% annual adjustment rate and the impact of currency exchange rates, and explore how organisations can regain control of their support strategy to better align spend with business value.
Oracle’s Software Update Licence & Support (SULS) contracts typically include an annual adjustment rate of around 8% (there are indications that this could rise to as much as 10%). While this increase may appear modest on a yearly basis, the compound effect over time is substantial.
Consider a starting annual support fee of €100,000. With an 8% annual increase, this means that after nine years, the annual support cost grows to approximately €200,000 and the total paid over those nine years reaches roughly €1.35 million.
All of this occurs while the support services and software environment may remain largely unchanged. In other words, the support bill effectively doubles over the nine-year period through compound increases alone.
There is another factor that is often less visible but equally important: currency exchange rates. Oracle is a US-based company and reports its revenue in US Dollars. However, many European customers pay their support fees in Euros.
When the Euro strengthens against the Dollar, Oracle records higher revenue in USD even if customers pay exactly the same Euro amount.
Example (January 2025 vs. January 2026)
Annual Oracle support fee: €100,000
| Scenario | Exchange rate effect |
|---|---|
| Previous year | €100,000 ≈ $102,000 |
| Strong Euro | €100,000 ≈ $117,000 |
In this scenario, Oracle reports roughly 14% more revenue in USD without any change to the Euro price. This increase occurs purely due to exchange-rate movements.
When both mechanisms occur together, Oracle support revenue can increase in two ways:
From the customer perspective, however, the software remains the same, the support services remain the same, and the business value often remains unchanged. Yet the overall cost continues to rise.
For organisations with stable Oracle environments, this cost trajectory often raises important strategic questions. Is the level of support received aligned with the increasing cost? Are automatic annual increases justified?
As a result, many organisations are beginning to reassess their Oracle support strategy to ensure it still aligns with their long-term business goals, while simultaneously challenging automatic indexation clauses during renewal discussions.
Furthermore, there is a growing trend towards evaluating the feasibility of third-party software support providers as a way to decouple from the vendor’s rigid price hikes and gain the commercial leverage necessary to negotiate more favourable terms.
A 2025 Gartner® Market Guide[i] says: By leveraging TPSS [third-party software support], organisations can achieve substantial reductions in software operating expenses – typically an average annual savings of 50% compared with traditional vendor support. Tangible outputs include lower maintenance costs, improved budget flexibility and access to additional support services.
For those companies that choose to explore third-party software support providers as an alternative to vendor support it can lead to support cost reductions of up to 50%, more predictable long- term expenses, and additional leverage in commercial discussions with Oracle.
| Scenario | Annual cost (Year 9) | Nine-year total |
|---|---|---|
| Oracle support (8% annual increase) | ~€200,000 | ~€1.25M-€1.35M |
| Third-party support | ~€50,000 | ~€450,000 |
For some organisations, the possibility of third-party support alone can also provide commercial leverage in negotiations with Oracle, potentially reducing the annual adjustment rate.
Oracle support costs tend to grow by default due to contractual mechanisms and financial dynamics. However, organisations that proactively review their support strategy often discover opportunities to better align cost with value.
At SoftwareOne through our advisory services, we support customers by assessing the actual value of Oracle support compared to its cost, evaluating third-party software support eligibility, and supporting fact-based commercial discussions.
Recently, for a European-based enterprise customer we advised that they compare third-party support costs against Oracle support costs and assisted behind-the-scenes with negotiation tactics which led to zero percent indexation for the next four years without any committing to buying more licences.
The key takeaway is simple: Oracle support costs increase automatically – but controlling them requires a deliberate decision. Organisations that periodically review their strategy are often best positioned to ensure their support investments continue to deliver value.
[i] Gartner ® Market Guide for Independent Third-Party Software Support of Megavendors. Published June 27, 2025. Authors Rob Schafer, JoAnn Rosenberger's et al.
GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved.
To schedule a call with one of our Oracle solution advisors and understand how the indexation of Oracle could be reduced or if third-party software support might be an option
To schedule a call with one of our Oracle solution advisors and understand how the indexation of Oracle could be reduced or if third-party software support might be an option
