The Campaign for Clear Licensing (CCL) has published an open letter to Larry Ellison and the board of directors at Oracle, urging them to "improve trust and communication" with their customers over the use of Oracle cloud computing services.
If Oracle "does not address customer concerns" over its licensing and auditing practices, the CCL warns, Oracle "may struggle" to hit its stated target of over $1 billion cloud sales in the next fiscal year.
Like all of the major software companies that built their businesses on the traditional annual licensing model, says the CCL, Oracle is being pressured to shift its business to the emerging cloud computing model, whereby companies pay for software as and when they use it.
The CCL says cloud services still only represent less than five percent of Oracle's total revenue and that "the lasting issues of customer mistrust" could "pose a dampener on long-term growth".
In November 2014, the Campaign for Clear Licensing published a report which "highlighted the extent of customer mistrust" on Oracle's licensing and auditing practices. The report, which was based on a survey of over 100 Oracle customers worldwide, including six FTSE 100 companies, found that Oracle's audit requests are "often unclear and difficult to respond to".
It also said that Oracle's own License Management Services organisation (LMS) is "largely unhelpful to customers during an audit", and that the company's licensing changes are "often poorly communicated" — to the extent that in some instances Oracle's own sales teams and LMS are "often found to be working with out-of-date licensing information".
Sign up for CIO Asia eNewsletters.