HomeMy WebLinkAboutFCS-12-166 - Oracle Volume Licensing AgreementREPORT TO:Finance & Corporate Services Committee
DATE OF MEETING:
October 15, 2012
SUBMITTED BY: Dan Murray, Interim Director of Information Technology,
X2825
PREPARED BY:
Mark Daugherty, Coordinator, Database Administration
X2237
WARD(S) INVOLVED:
All
DATE OF REPORT:
October 5, 2012
REPORT NO.:
FCS-12-166
SUBJECT:
ORACLE VOLUME LICENSING AGREEMENT
RECOMMENDATION:
That the Director of Supply Services be authorized to execute the Master Agreement
Acknowledgement dated 20-SEP-2012, with Oracle Corporation, adopting the terms and
conditions of the Volume Licensing Agreement negotiated between the Government of Ontario,
Ministry of Government Services – Supply Chain Management and Oracle Corporation ULC;
said form of agreement to be to the satisfaction of the City solicitor; and,
That the Director of Supply Services be authorized to execute the Acknowledgement to Ontario
agreement, with HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO, as a prerequisite
requirement to enter into the above Master Agreement Acknowledgement with Oracle
Corporation ULC; said acknowledgement to be subject to the satisfaction of the City solicitor;
and,
That Oracle Corporation ULC be listed as a sole source provider of software maintenance and
software support for Oracle software products that the City already owns or may purchase
during the term of this agreement.
BACKGROUND:
The City of Kitchener has utilized software products from Oracle Corporation to support our
enterprise applications for over a decade.
Since 2001, the City of Kitchener along with many Ontario municipalities has leveraged pricing
agreements negotiated by the Government of Ontario and Oracle Corporation to facilitate the
procurement of Oracle software and related products. These provincial agreements provided
software licenses and related terms and conditions that were more favorable than Oracle’s
standard software license agreements. The agreement was renewed in 2005 for five years. In
2010, the Ontario Ministry of Government Services – Supply Chain Management re-negotiated
the terms of the agreement with Oracle Corporation. We are recommending that we enter into
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the new agreement in order to continue to gain access to the preferential broader public sector
pricing and to standardize the terms and conditions for all our purchases with Oracle
Corporation ULC.
REPORT:
The current agreement is effective as of September 17, 2010 and has a term of five years. The
agreement can be terminated by either party on 60 days prior written notice to the other.
Although the agreement provides significant discounts off most of Oracle’s products, it does not
preclude or prevent further price and term negotiations, which may be appropriate when special
orders are being acquired. City staff will continue to investigate all purchasing options for any
new software acquisitions in accordance with the City’s Purchasing bylaw in order to ensure that
we are receiving the best pricing possible.
For existing Oracle software products that the City uses, software maintenance and support
services are required and can be purchased through this agreement and the related preferential
broader public sector pricing that the provincial government has negotiated. These
maintenance and support services are provided directly through Oracle Corporation and are not
available through third-party vendors. Oracle is a sole source provider of these maintenance
and support products.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
Efficient and Effective Government
By entering into this agreement we would be able to continue to control the costs associated
with acquiring and using Oracle technology products. This meets the following strategic
directions.
Stewardship of Public Funds: Ensure effective and responsible use of public funds.
Manage to the Bottom Line: Ensure corporate fiscal targets are consistently met.
Capitalize on Existing Investments: Simplify the technology environment and exploit
existing investments by rationalizing processes and standalone applications into the
city's current enterprise systems where appropriate.
FINANCIAL IMPLICATIONS:
Since the expiration of the agreement in 2010, Oracle has continued to honour the broader
public sector discounts with the City. This agreement formalizes the pricing structure between
the City and Oracle and leverages the purchasing power of the Ontario Government and other
broader public sector agencies. It does not limit us to further price negotiations directly with
Oracle.
The agreement standardizes the terms and conditions associated with the procurement of
Oracle products. This reduces the staff time and costs associated with reviewing this for each
individual purchase.
As this agreement does not limit the City’s purchasing options, City staff will continue to procure
new Oracle software product purchases in accordance with the City’s Purchasing by-law.
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The annual maintenance and support fees paid in 2011 for Oracle Corporation software
products was $49,717.94. (This figure does not include software maintenance on PeopleSoft
which was subsequently acquired by Oracle and is the subject of a separately negotiated
contract)
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO Finance and Corporate Services
Department
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