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Techgoondu > Blog > Enterprise > Price hikes push APAC businesses to seek Java alternatives
EnterpriseSoftware

Price hikes push APAC businesses to seek Java alternatives

Alfred Siew
Last updated: June 28, 2024 at 11:18 AM
Alfred Siew
Published: June 28, 2024
6 Min Read
PHOTO: Unsplash

Price hikes in a fundamental building block of the digital economy, in the form of Java software code, have pushed businesses in Asia-Pacific to seek alternatives to keep their cloud servers, e-commerce sites and many other everyday digital services running without disruption.

The efforts gathered pace early last year when Oracle, the software giant that acquired the most popular version of Java from Sun Microsystems in 2009, ramped up its efforts to make big businesses cough up millions of dollars for using the software.

Its new terms: Pay for a license for each employee in your organisation, even if only a small portion of them use the software.

This means coughing up for Java licences for administrative staff in a university, miners in a mining company and storekeepers in a supermarket chain, a situation that has pushed organisations to seek alternatives.

This is reflected in rival Azul Systems’ growth announced yesterday. The software company, which promises a similar but alternative version of Java at a discount of up to 70 per cent, reported a 37 per cent year-on-year increase in bookings in Asia-Pacific in its latest fiscal year.

In its most recent quarter, it enjoyed 437 per cent growth from a year ago, boosted by its entry into India, where its customers include “one of India’s largest securities institutions”.

In Asia-Pacific, it is speaking to a number of other large banks and counts the University of Sydney as a customer. Across the world, Azul’s version of Java is used by Apple, Samsung, Netflix, Mastercard, Volkswagen, and many more.

Besides Oracle and Azul, other vendors offering support for their own versions of the open-source Java software include Amazon and Red Hat, though they appear to be aimed more at customers using their technology stacks.

This means Azul, which offers Java Standard Edition (Java SE) as well as an optimised version that promises improved cloud performance, has become attractive to many large organisations seeking to replace Oracle Java.

In Asia-Pacific, banks have turned to Azul because they need the technical support to make sure their apps run reliably and securely in a regulated environment, said Dean Vaughan, Azul’s vice-president for the region.

Another important customer segment is made up of cloud-native businesses in Southeast Asia, which have sought out Azul’s optimised OpenJDK version of Java to cut down cloud infrastructure costs and improve customer experience, he told Techgoondu, on the sidelines of a customer event in Bangkok.

Ironically, Oracle’s licensing changes may have become Azul’s best salesman. This typically happens when Oracle comes knocking on businesses with an e-mail to run an audit of Java usage.

Its latest licensing model from last year is estimated to be two to five times more expensive than a previous one that charged by the number of users or processors, according to associate principal analyst Nitish Tyagi of Gartner.

This, the research firm predicts, will drive businesses to move to Java alternatives, which will make up 80 per cent of the market in 2026.

Java was free to use up until a few years ago, so Oracle would not be losing any revenue. Even with shrinking share, the new licensing costs it is imposing on customers is delivering a new stream of revenue.

Even organisations that buy Oracle’s database software have found that they can’t skip the Java licence fees, even if they are spending millions in the more prominent product. The Oracle Java and database product teams are said to run separately.

“Some banks look at their 300 to 400 apps and think they can’t migrate, so they pay the (Oracle) tax,” said Vaughan. “But we have significant organisations and best practices to help customers migrate, to alleviate their fears.”

Azul matches the existing Oracle Java version used by a customer to make sure apps run correctly before that is upgraded to the latest one available. This is because changes in new versions, such as support for security protocols, may impact apps running on the Java software.

More than just a low-cost alternative, Azul says it is also helping to drive the future of Java. It is a member of a working group that helps make security patches and it is also on committees that chart the direction of the software in future.

Simon Ritter, Azul’s deputy chief technology officer, is part of an industry group driving Java standards. Among the new ideas his company has contributed, he said, are a more optimised way to start up applications, which would lead to better response times and interfaces for users of digital services.

A part of a team at Sun that worked on the earliest versions of Java in the 1990s, he said costs were not an issue just a few years ago when people assumed Java was free.

Of late, some companies have got a rude shocked when they were told to cough up millions of dollars in licensing fees because they had a high number of employees, he told Techgoondu.

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TAGGED:Azulcloud computingJavaOpenJDKOracleSun Microsystems

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ByAlfred Siew
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Alfred is a writer, speaker and media instructor who has covered the telecom, media and technology scene for more than 20 years. Previously the technology correspondent for The Straits Times, he now edits the Techgoondu.com blog and runs his own technology and media consultancy.
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