Oracle Java Licensing – Four Java Licensing Changes

Oracle Java Licensing

• New Employee for Java SE Universal Subscription model
• Licensing is based on the total number of full-time and part-time employees, including contractors
• Replaces Named User Plus and Processor licenses
• Simplifies licensing across the entire organization
• Pricing varies with employee count, offering volume discounts
• Ensures all employees are covered regardless of actual Java usage

Oracle Java SE Licensing Guide for Enterprises

Oracle Java SE (Standard Edition) licensing has evolved dramatically over the past few years. What used to be a freely available runtime now requires careful navigation of Oracle’s licensing terms.

This guide provides a comprehensive overview of Oracle Java licensing changes for enterprise IT, covering recent licensing changes, contract types, audit risks, commercial features, costs, and negotiation strategies.

It focuses exclusively on Oracle’s Java SE (not OpenJDK or other distributions), delivering practical insights in a clear, advisory tone.

Oracle Java Licensing Changes (Timeline and Impact)

Oracle’s Java licensing model has undergone several major shifts in recent years.

Below is a timeline of key changes – from the introduction of paid subscriptions in 2019, through the “No-Fee” license in 2021, to a new employee-based model in 2023 and their impact on users​

Each change affected who needs a license and how organizations stayed compliant:

• 2019 – Java SE Subscription Model Introduced: 2019 Oracle ended free public updates for Java 8 and introduced a paid Java SE subscription model. After January 2019, businesses could no longer legally use newer Oracle Java updates in production without a subscription. Oracle’s new subscription required licensing Java either per Named User Plus (per user for desktops) or per Processor (for servers)​. Impact: Many enterprises were caught off-guard – those running Oracle JDK 8 in production had to purchase subscriptions or freeze at older update levels​. Oracle also rolled out a new Oracle Technology Network (OTN) download license that allowed free use only for personal, development, or testing purposes, not for commercial production​. This ended the “free Java” era for commercial users unless they migrated to alternatives.
• 2021 – Oracle No-Fee Terms (NFTC) Introduced: Responding to customer pushback, Oracle unveiled the No-Fee Terms and Conditions (NFTC) license with Java 17 (September 2021)​. Under NFTC, Oracle JDK 17 and later could be used for free in production, including commercial use – but only for a limited time​. The NFTC made the latest Long-Term Support (LTS) release free until one year after the next LTS release. For example, Java 17 was free from 2021 until one year after Java 21’s release (its successor), after which updates for Java 17 would require a paid subscription​. Impact: This temporary free-use window encouraged companies to upgrade to the latest Java LTS without immediate cost. However, it was a stop-gap – older versions (Java 8, 11) remained under paid license requirements​. Companies could reduce costs by staying on the latest Java, but anyone needing long-term support on an older LTS still had to buy subscriptions once the free period lapsed.
• 2023 – Employee-Based “Universal” Subscription: In January 2023, Oracle overhauled its model by launching the Java SE Universal Subscription with an employee-based licensing metric​. This eliminated the per-user and per-processor licenses. Instead, organizations must license Java for all employees (including part-time and contractors), regardless of how many use Java​. Oracle positioned this as an “unlimited” enterprise license – you can deploy Java anywhere, but you pay according to total headcount​. Impact: This was a major change. It simplified compliance (no need to count CPUs or named users) but often raised costs significantly for larger firms​. Companies with many employees but few Java applications saw substantially higher fees under the new model​redresscompliance.com. For example, a mid-sized business with 500 employees would pay about $90k/year under 2023 pricing (500 × $15/month) even if only a handful uses Java​. Existing Java SE subscription customers on the old model could generally renew under their current terms. Still, Oracle’s direction was clearly toward moving everyone to the employee metric.

Summary: Oracle Java SE licensing has shifted from free use (pre-2019) to a paid subscription per user/processor to a broad enterprise-wide subscription. Each change aimed to increase Oracle’s Java revenue – first by charging for updates, then by offering a free LTS window to drive upgrades (but still charging for long-term support), and finally by maximizing coverage (charging per employee).

Organizations must stay aware of these changes to avoid compliance surprises when Oracle alters terms or an apparently “free” Java version later requires a purchase.

Java Licensing Agreements and Terms

When using Oracle Java SE, enterprises may encounter a few different agreement types, each with its rights and restrictions. The main Oracle Java SE licensing agreements are:

Java SE Subscription Agreement (Commercial License)

You enter this paid license contract when purchasing Oracle Java SE subscriptions. It grants the right to use Oracle’s Java SE in production and receive updates/support if you keep paying the subscription fee​.

Typically, you either sign an ordering document under an existing Oracle Master Agreement, or Oracle provides a standard Java SE subscription agreement if you have no master contract​.

Key points of the subscription agreement:

• It specifies the licensed metrics and scope (under the legacy model, it would list the number of Named User Plus or Processors; under the new 2023 model, it’s the number of Employees covered)​. You can deploy Oracle Java on the licensed quantities/scope and comply. Under the employee-based license, you’re licensed for unlimited installations as long as all employees are counted in the subscription.
• It includes rights to all necessary Java SE patches, security updates on the covered versions, and access to Oracle support (support tickets, knowledge base) for Java​. In other words, with an active subscription, you can download and apply updates (even for older versions like Java 8) unavailable to the general public.
• It imposes certain obligations: you must report or true-up if your usage scope increases (e.g., if your employee count grows), and you agree to Oracle’s audit rights to verify Java usage​. The agreement usually references Oracle’s standard audit clause, meaning Oracle can request an audit of your Java deployment similar to audits for other Oracle software.
• If you stop renewing the subscription, your rights to use Oracle Java updates and support end. You would no longer be entitled to apply new patches, and continued use of Oracle Java would technically be unlicensed (unless you fall back to a free use case or an Oracle-provided free license for a particular version).

In summary, the Java SE Subscription Agreement is the commercial license that “keeps the lights green” for Oracle Java in an enterprise – as long as you pay, you are authorized for use and support​.

Oracle Master Agreement (OMA) – Java Order or Addendum

The Oracle Master Agreement (OMA) is Oracle’s umbrella contract many companies have in place. If you have an OMA with Oracle, your Java SE subscriptions may be governed by it via a Java-specific ordering document or amendment.

The OMA contains the general legal terms (liabilities, definitions, audit rights, etc.), while the order form adds Java-specific terms like the number of licenses, metrics, and pricing​.

Under an OMA structure, the usage rights for Java are effectively the same as those for the standalone subscription agreement – you must adhere to the licensed metric (e.g., employee count) and receive support as specified​. The benefit is administrative: all your Oracle products are under one master contract. For example, if you already license Oracle Database under an OMA, you can add Java SE by simply signing a short order form referencing that OMA. Any negotiated custom terms in your OMA (for instance, specific audit notice periods or liability caps) would also apply to Java unless explicitly overridden​.

Important: Oracle’s audit rights under the OMA will also cover Java​. So, if Java is added to an existing OMA, an Oracle audit could include Java usage and other Oracle products.

Oracle No-Fee Terms and Conditions (NFTC) License

The NFTC is Oracle’s free license introduced with Java 17 (2021) for certain Java SE releases. It’s a public click-through license (accepted when downloading Oracle JDK under NFTC terms) that allows running Oracle Java without cost but with conditions​.

Key aspects of the NFTC agreement include:

• Free Use for Current Version: During a limited window, you may use the Oracle JDK in production without paying under NFTC only for the current LTS version (and any interim versions)​. Oracle grants a time-limited free license for the latest Java. For example, Oracle JDK 17 could be used for free from its release in 2021 until one year after Java 21’s release (the next LTS)​. After that, the free period for Java 17 ended (in September 2024), and continuing to use or update Java 17 in production would require a subscription or an upgrade to Java 21​.
• No Free Long-Term Support: NFTC does not entitle you to patches beyond the free period or any Oracle support​. Once a Java version’s NFTC window closes, you won’t get further security updates unless you become a paying customer (or upgrade to the next free version). It’s essentially “use at your own risk” after the cutoff – Oracle provides zero support commitments beyond the initial period.
• No Redistribution Rights: NFTC forbids redistributing Oracle’s Java binaries to third parties​. It’s meant for internal use, so if you are a software vendor or embed Java in a product, NFTC is insufficient – you would need a proper license to distribute Java with your application.
• Older Versions Excluded: The NFTC only applies to Oracle JDK 17 and later. Older versions (Java 8, 11, etc.) remain under their original licenses (which generally require a subscription for commercial use). So you cannot assume Java 8 is suddenly free—the NFTC was not retroactive.

In practice, the NFTC agreement allowed organizations to temporarily use Oracle’s JDK for free to stay on the latest release. This is useful for those who continuously update to the newest Java version and don’t need Oracle’s long-term support. However, it’s critical to track the timelines—running a Java version past its NFTC free-update period without a paid license would put you out of compliance.

(Note: Oracle’s older Java download licenses include the Binary Code License (BCL) used before 2019 and the OTN License used for Java 8 updates and Java 11. These allowed some limited free uses (e.g., “general purpose computing” or development) but required a subscription for production use​. In 2021, NFTC effectively replaced the OTN for new versions by temporarily making production use free for the current version.)

Java Audit and Compliance Risks

Oracle has aggressively audited Java usage in enterprises, especially since Java became a paid offering. Compliance risks are significant if you use Oracle Java SE without proper licensing.

Below, we cover common audit triggers, what an Oracle Java audit entails, and examples of compliance issues and remediation steps:

• Common Triggers for Oracle Java Audits: Oracle’s License Management Services (LMS) and partners actively look for unlicensed Java deployments. Triggers include:
  • Download Activity: Oracle tracks Java downloads from its website. If a company’s domain or IP downloads Oracle JDK updates or installers (especially after free public updates for that version end) without a corresponding subscription on record, it’s a red flag​. Example: Downloading Java 8 updates post-Jan 2019 without a license may prompt Oracle to investigate.
  • Expired or Lapsed Subscriptions: If you didn’t renew a Java SE subscription, Oracle knows when it expired. Companies that let subscriptions lapse or reduce their license counts are often targeted on the assumption that they might still be using unlicensed Java​.
  • Ignoring Oracle’s Inquiries: Oracle often initiates a soft audit (an informal email inquiry about your Java usage). If you ignore these or refuse to cooperate, Oracle may escalate to a formal audit​. Dismissing Oracle’s initial outreach can increase suspicion of non-compliance.
  • Companies with No Oracle Relationship: Paradoxically, even organizations that aren’t Oracle customers can get audited. Oracle knows Java is ubiquitous, so a company with zero Oracle spend but likely Java usage can be seen as “low-hanging fruit.” Such firms (or certain industries that use Java) may be targeted to convert them into paying customers​. Conversely, Oracle’s big existing customers might get softer negotiations via account managers, but they aren’t exempt.
• What Oracle Java Audits Include: If Oracle audits your Java usage, expect a thorough inventory:
  • Oracle typically requires you to run discovery scripts or tools on all servers and PCs to identify Java installations​. These tools gather data on every instance of Oracle Java: version numbers, update patch levels, hostnames, and possibly the last update installed.
  • They will check for any use of commercial features on older versions (more on these features below). For example, the audit may ask if Java Flight Recorder or Mission Control was enabled on Java 8/11 since that would have required a license​.
  • The audit will examine deployment in virtualized environments. Oracle might scrutinize whether Java is used on VMs (e.g., VMware) in a way that, under Oracle’s policies, could require licensing all underlying physical hosts​. (Oracle has strict partitioning rules—if not using Oracle-approved partitioning, they might argue that all hosts in a cluster need to be licensed for Java, which can balloon compliance issues.)
  • Oracle may ask you to distinguish Oracle JDK vs. other Java distributions on each system​. Only Oracle’s distribution is subject to Oracle’s license fees, but you must document which installations are non-Oracle (to avoid being charged). To avoid confusion, it’s wise to only report Oracle JDK installations, not OpenJDK, unless required​.
  • Soft Audit vs. Formal Audit: In a soft audit (informal inquiry), Oracle might send a questionnaire asking you to self-report Java usage​. A formal audit is a contractual notice invoking your license agreement’s audit clause​. Once formal, you must comply, and deadlines will be set for data submission. Oracle typically uses formal audits if soft approaches fail or reveal major gaps.
• Examples of Audit Findings: Common compliance issues that audits uncover include:
  • Out-of-date Java installations are missing a license. For example, Oracle JDK 8 Update 271 runs in production without a subscription. Since public free updates for Java 8 ended after Update 202 (Jan 2019)​, using Update 271 commercially means you applied patches beyond the free period, requiring a paid license.
  • Commercial features used without a license: A team enabled Java Flight Recorder on a production server running Java 8 to diagnose performance issues. The audit finds evidence of Flight Recorder recordings, which required a Java SE Advanced license that the company didn’t have—a clear compliance gap (see next section on commercial features).
  • Miscounted licensing under legacy model: e.g., a company thought they were compliant with 100 Named User Plus licenses. Still, an audit finds they had Java installed on a server accessible by 500 users (meaning 400 users were unlicensed) or deployed on more CPU cores than they purchased. This would be reported as under-licensing.
  • Using Oracle JDK where not needed: e.g., some servers might be running Oracle’s JDK when they could have used OpenJDK. In audits, those count as non-compliant if no subscription is in place. Companies sometimes discover during audit preparation that simply uninstalling Oracle JDK or swapping to an open version on certain systems can instantly remediate some issues.
• Audit Remediation and Risks: Oracle will present an audit report detailing any shortfalls after data collection. Typically:
  • Oracle’s goal is to sell you a Java subscription in the future rather than collect back penalties​. In many cases, Oracle will demand that the company purchases sufficient Java SE subscriptions (often under the new employee-based model) to cover all usage moving ahead​. If you agree to a subscription purchase, Oracle may waive retroactive penalties for past use as a “concession”​.
  • However, Oracle often uses the threat of back-dated support fees to pressure the sale. Officially, Oracle could claim you owe support fees for the unlicensed period. These back fees can be large (imagine several years of subscription fees for all unlicensed instances). Often, they will present a scary dollar figure for past usage and then offer to waive it if you sign a new contract now.
  • The financial impact can be significant. There are reports of audit compliance claims in the millions of dollars for large enterprises with widespread Java use​. Even mid-sized companies have seen six or seven-figure compliance quotes. For example, a firm with 2,000 employees might be told they need 2,000 Java licenses under the employee model (2,000 × ~$12/month if discounted) plus possibly a one-time fee for past usage – easily over $200k/year going forward​.
  • If an organization refuses to buy or pay, it could face legal action for license violation, but most prefer to negotiate a purchase. The big risk is unbudgeted cost – once “free,” Java can become an unexpected line item consuming budget due to an audit.
  • Remediation options: In response to an audit, a company can either pay up (buy subscriptions) or remove/replace Oracle Java to come into compliance. Oracle typically gives a short window to remediate (e.g., 30-60 days). Some have used that window to rapidly uninstall Oracle JDK or switch to OpenJDK on many systems, eliminating the need to buy licenses. Others negotiate a smaller scope license (if they can prove that not all installations require Oracle JDK).

Bottom line: The compliance risk with Oracle Java is real and now a common focus of Oracle audits (Gartner noted that by 2022, over half of Oracle audit issues involved Java​). To avoid surprises, enterprises should proactively inventory their Java usage, eliminate Oracle JDK where it’s unnecessary, and ensure that any required licenses are in place.

Commercial Features in Java SE (and What Triggers a License)

Oracle Java SE has certain advanced features that Oracle historically treated as “commercial features” – meaning you needed a paid license to use them in production legally. Knowing these features is crucial because using them without proper licensing is a common compliance trap.

Here are the main Java SE commercial features and their licensing status:

• Java Flight Recorder (JFR): A low-overhead JVM profiling and diagnostics tool that records runtime events. License rule: In Oracle JDK 7 and 8, JFR was a commercial feature – if enabled on a JVM, that JVM required a Java SE Advanced (or Suite) license. For example, enabling Flight Recorder on 10 production servers would require licenses for those 10 servers​. (Oracle’s documentation gives an example: if JFR is enabled on a JVM, you need a license for that server​.) Modern status: Oracle open-sourced JFR in OpenJDK 11, so in open-source Java, it’s free. In Oracle JDK, by the time of Java 17+, Oracle effectively allows its use under the NFTC or subscription (since the concept of separate “Advanced” licenses is fading). However, on older Java 8/11 installations, using JFR without an Oracle Java SE Advanced subscription is a compliance violation.
• JDK Mission Control (JMC): A GUI tool to analyze Flight Recorder data and monitor the JVM. License rule: Like JFR, Mission Control was a commercial feature tied to Java SE Advanced. Using JMC to connect to a JVM or deploying JMC in production required licensing. Note: Running JMC on a developer workstation to analyze recordings from another system might not trigger a license (Oracle’s policy was that the servers being observed with JFR/JMC need licensing, not the client workstation​oracle.com). If you use JMC only on non-production/dev environments, it’s fine, but using it against production JVMs implies those JVMs had JFR on; hence, they need a license. Today, JMC is also open-sourced (available through the Eclipse Foundation) and can be used freely with OpenJDK JFR. Still, with Oracle JDK, the same historical restriction applies to older versions.
• Java Advanced Management Console (AMC): A tool for enterprise deployment management of Java (tracking Java versions on desktops, controlling Java usage via deployment rules, etc.). License rule: AMC was included in Oracle Java SE Advanced (for desktops) and considered a commercial feature from Java 8 update 20 onward​oracle.com. Using the Advanced Management Console to manage Java across PCs required a paid license. If an organization installed the AMC server and agents to centrally control Java settings, they needed Java SE Advanced Desktop licenses for those endpoints.
• Usage Tracker: A feature in Java that logs how the JRE is being used (to help track usage of Java in an organization). It was also listed as a commercial feature requiring Java SE Advanced​. If enabled, each Java runtime would produce a usage log. Turning this on in production meant using an Oracle-restricted feature; thus, a license was needed. (It’s ironic because the usage tracker is meant to help compliance, yet using it without already having a license violates compliance!)
• Others (Legacy/Embedded/JRockit features): Oracle’s documentation also lists JRockit-specific features (from the old Oracle JRockit JVM) like JRockit Real Time (deterministic GC) and JRockit Mission Control components as commercial, but these are legacy and apply if you were using JRockit or Oracle Java SE Suite in the past​. JFR and JMC are the big ones to watch for most current purposes. JavaFX and standard JVM capabilities are not “commercial features” – they are part of the normal Java SE usage and don’t require extra licensing beyond what’s needed for the Java runtime itself.

Chargeable vs. Freely Available: In the context of Oracle Java SE licensing, “commercial features” were chargeable when used with Oracle’s JDK under free-use terms. If you were using Oracle Java under the free license (BCL/OTN) in the past, you could not enable those features without buying a Java SE Advanced or Java SE Suite license.

However, under a Java SE Subscription, you are generally covered to use those features (Oracle’s subscription essentially bundles what were previously “Advanced” features). In open-source Java (OpenJDK), these features (like JFR/JMC) are freely available in newer versions.

What triggers commercial usage? Simply put, activating any of the above features on Oracle’s JDK triggers the need for a paid license. Oracle’s Java binaries even printed a message in the console log if you started Flight Recorder, indicating that “commercial features are in use” as a reminder that you need a license.

For example, if an admin starts a JFR recording on an Oracle JDK 8 JVM for troubleshooting, that act toggles the software into a “commercial feature in use” state. At that point, Oracle would consider the JVM unlicensed unless you have Java SE Advanced rights. Even using the jcmd utility to unlock commercial features (there was a flag to unlock them) was an auditable event.

To stay safe, companies should avoid using these features on Oracle JDK installations without a subscription or ensure they have the appropriate Java SE subscription/Advanced licenses that grant usage. Note that from Java 11 onward, since JFR became free in OpenJDK, Oracle’s stance also evolved – but formally, if you’re running Oracle’s builds, always check the licensing terms. As of Oracle’s latest FAQs, Oracle Java Flight Recorder is included with Java SE (and under NFTC, it’s free during the free-use period) – but the historical rule applies​to older releases.

Java Licensing Costs: Legacy vs 2023 Pricing Models

Oracle’s Java SE licensing costs can be understood by comparing the legacy subscription model (2019–2022) with the new employee-based model (2023). Below is a comparison of the two models, including how licenses were measured and typical pricing, followed by real-world pricing examples.

Note: Oracle’s switch to the employee metric was widely expected to increase costs for most existing customers​. The only cases where the new model might be cheaper are organizations with few employees but a high server count.

In general, enterprises have found that the employee-based pricing results in paying for a large number of non-users of Java, effectively subsidizing Oracle for the “ubiquity” of Java within the company.

Real-World Pricing Scenarios:

• A mid-sized tech company with 500 employees: Under the new model, they pay ~$90,000 annually​. Under the old model, if only 50 of those employees were using Java (e.g., developers or certain app servers), the company might have paid for 50 NUP licenses = ~$1,500/year (50 × $2.50 × 12) or a couple of server processor licenses. The new model in this scenario is ~60× more expensive, illustrating why many felt “Java is no longer free” in a big way.
• A large enterprise with 10,000 employees: At 10k employees, Oracle’s tiered price might be around ~$7.50 per employee/month. That’s $75,000 per month, or $900,000 per year. Under the old model, if the enterprise had 200 servers running Java and 1,000 actual Java users, legacy licensing (200 processors or 1,000 NUP) might have been on the order of $300k/year. The new model triples that cost. If the enterprise truly had Java on every desktop for internal apps, the scale might be different, but most did not.
• A small business with 50 employees: At 50 employees, Oracle’s smallest tier might still be $15 each, totaling $750/month ($9k/year). Under the old model, if only a few IT staff used Java or a single server needed it, the cost could have been as low as $25/month or a few hundred a year. Many would migrate to free alternatives for very small shops rather than pay $9k/yr.

These examples demonstrate why the 2023 employee-based model often shocks companies. It functions like an enterprise license with a cost proportional to company size, not Java usage. Organizations now must budget Java like a company-wide utility.

Importantly, Oracle’s list prices can be negotiated (see next section), and very large customers can push the per-employee rate down. However, the fundamental shift is that Java is a paid subscription for the entire organization if you go with Oracle’s JDK beyond the free use cases.

Java Licensing Negotiation Tips

Facing Oracle’s Java licensing requirements, enterprise customers are not without leverage. Here are practical negotiation tips to achieve more favorable terms and control costs, including strategies around bundling, contract terms, and alternative options:

• Leverage Third-Party Alternatives: Perhaps the strongest bargaining chip is that Java is not an Oracle-exclusive technology. Free OpenJDK distributions exist (Amazon Corretto, Eclipse Temurin, Azul Zulu, etc.) and third-party support vendors. Let Oracle know you can switch away if the deal isn’t right​. Explicitly mentioning that you are evaluating a migration to OpenJDK or a competitor’s supported Java build can pressure Oracle to offer discounts or more lenient terms. Example: A company that demonstrates it is pilot-testing Azul’s supported OpenJDK might prompt Oracle to improve its price offer to retain the business​. Oracle sales reps know that Java’s ecosystem is open – use that fact. Tip: Even if you prefer to stay with Oracle Java, assessing OpenJDK as a credible Plan B costs nothing.
• Bundle Java with Other Oracle Deals: Oracle tends to give better deals when Java is included in a larger package​. If your company is negotiating an Oracle ULA (Unlimited License Agreement) or renewing a major Oracle product (Database, Middleware, ERP apps, etc.), consider adding Java SE into the negotiation mix. You can often get steeper discounts or concessions by tying Java subscriptions to a bigger purchase. Oracle may be willing, for example, to throw in a certain number of Java licenses at a reduced rate or cap Java pricing if you’re also committing to Oracle Cloud or Database licenses. Example: During an Oracle Database renewal, a customer negotiates to include Java SE for all employees at a significantly reduced per-employee rate as part of a multi-product deal – Oracle might justify this internally as protecting a larger revenue stream (database) by being flexible on Java​. Bundling also simplifies vendor management, which Oracle knows can be a selling point.
• Negotiate the Licensing Metric or Scope: Remember that Oracle’s standard offer is not the only way. Depending on your situation, you might negotiate a custom arrangement. For instance, if you have a relatively small, contained Java usage, try asking for a pricing model based on that usage (e.g., a certain number of servers or users) instead of an all-employee count. While Oracle’s public stance is that the employee metric is mandatory now, in practice, they have some flexibility for strategic customers. They might, for example, agree to license just a particular business unit or a fixed number of users if that’s the difference between making a sale or losing the account. Also, if you already have legacy Java licenses (NUP/processor), you could negotiate to renew those under the old model rather than switching to employee-based​ Oracle. It has allowed some existing customers to renew without changing metrics (at least for a limited time)​. The key is to align the metric with your Java footprint so you’re not overpaying for people or machines that don’t use Java. If Oracle initially balks, emphasize that you’ll otherwise allocate budget to switching technology rather than pay for idle licenses.
• Request Price Protections (Caps and Locks): Oracle’s list prices can increase over time, and if your employee count grows, your Java fees will grow. It’s wise to negotiate price caps and fixed terms. For example, push for a clause that freezes the per-employee price for a multi-year term (no inflation increase) or caps any annual increase to a low percentage​. Also, consider negotiating that the employee count is fixed at a certain number for the agreement term – so if your company hires 1,000 more people next year, you’re not immediately hit with a 1,000 × $15 extra bill until renewal. Oracle may or may not agree to fix the count. Still, they might agree to a definition that excludes certain categories (for instance, maybe you can exclude contractors or part-time workers below a certain threshold, even though standard terms count them – it never hurts to ask for exclusions if some of your “employees” don’t even have computer access). Contract caps on cost provide budget predictability. Oracle is often amenable to multi-year commitments, so get a multi-year price hold in exchange. Example: Negotiate a three-year Java subscription at a fixed rate (or with at most 3% annual increase) and lock the employee count for that period. This way, even if Oracle’s price list goes up or your workforce expands, your Java cost doesn’t skyrocket.
• Include Favorable Clauses (Opt-Outs, Renewal Terms): Pay attention to the fine print. Try to include an opt-out or termination clause if possible – e.g., the ability to reduce the number of licenses or terminate after a year if Oracle fails to meet certain support obligations or if your company divests a division. Oracle might not easily allow termination for convenience. Still, if you’re committing to a large, new Java contract, you could insist on a clause that lets you reduce scope without penalty if you migrate off Oracle Java. At minimum, ensure the agreement doesn’t auto-renew for a full term without allowing you to adjust. Negotiate renewal terms that allow you to renegotiate pricing rather than a fixed uplift. Some customers also negotiate a right to certify usage: for example, if, after two years, you have successfully reduced your Java footprint (maybe you moved half the apps to OpenJDK), you want the right to reduce the subscription accordingly at renewal. Oracle sales typically want to lock in as much as possible, but strong customers have obtained flexible terms.
• Audit and Compliance Safeguards: If you’re signing a Java contract, you can also negotiate how audits will be handled. For instance, include a clause that Oracle must provide a notice period before any audit (e.g., 45 days) and that you’ll be given a remediation period (e.g., 60 days to resolve issues) before Oracle can claim a breach​. This can protect you from surprise compliance bills and allow you to fix any inadvertent issues. Also, clarify usage definitions (for example, clearly define that non-production environments are not counted towards licensing, if that’s a gray area). While Oracle has standard audit language, you can sometimes soften it.
• Consider Third-Party Support as an Interim Solution: If Oracle isn’t budging and you need more time, one tactic is to use third-party Java support providers as a short-term solution. Firms like Azul or Red Hat offer support for Java (including old versions), often at a lower cost. While this means switching to OpenJDK builds, it can be a way to get off Oracle’s immediate radar and buy time. You can mention to Oracle that you might go with third-party support for Java instead of Oracle’s subscription – this often gets their attention because it means lost business for them. Even if you do this, keep the door open to Oracle with the possibility of a better deal later.

In summary, do not accept Oracle’s first quote as the only option. Much like database or ERP negotiations, there is room to negotiate Java licensing. Oracle’s list pricing is high, and savvy customers are expected to push back.

Enterprises have secured significantly better Java agreements by showing willingness to walk away (to open-source), bundling Java into bigger deals, and nailing down protective contract terms than the “sticker price” would suggest.

Remember: You have been using Java technology for years, and now that they charge for it, Oracle needs to earn your business. Use that leverage to your advantage.