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What does Oracle think about those companies that offer third-party maintenance and support services for Oracle’s software — for up to half off Oracle’s price? Look no further than the names of these two lawsuits: Oracle v. TomorrowNow and Oracle v. Rimini Street.

TomorrowNow (a now defunct third-party support player that SAP owned for a while) and Rimini Street have been the high-profile faces of third-party maintenance offerings for years, and their pitch is simple: ERP support for half off Oracle’s prices on its PeopleSoft, JD Edwards, and Siebel software. Customers pay software vendors annual maintenance and support fees on their software — which is calculated as a percentage of software licenses, in Oracle’s case 22 percent. The fees cover technical support, major application releases, bug fixes and patches, and product update rights, such as critical regulatory, legal, and tax updates.

[ Oracle is trying to hold onto maintenance contract revenue because big-bang ERP rollouts have hit a wall. | Discover what's new in business applications with InfoWorld's Technology: Applications newsletter and Killer Apps blog. ]

Judging by the ferocity of legal battles to date, Larry Ellison & Co. don’t take too kindly to those who invade their hallowed maintenance turf. The crux of the lawsuits against TomorrowNow (formally against SAP) and now Rimini Street, which Oracle filed in January 2010, is this allegation: Massive theft and misuse of Oracle intellectual property, software, and related support materials by said defendants through an illegal business model.

The cases have been contentious, intriguing, and expensive. They also demonstrate the lengths to which Oracle will expend its vast resources to protect its intellectual property (IP) and multibillion-dollar maintenance and support revenue streams.

But what if one of Oracle’s valuable partners — say, a reseller or system integrator or consultant — were to offer support services similar to those provided by Rimini Street? In fact, court documents show that Oracle has confirmed that there are such third-party support providers in its partner ecosystem. (Oracle’s lawyers have made it clear that Oracle does not sanction this type of business activity.)

Therefore, the question is this: Should Oracle have a legal beef with those partners as well, since they offer a service based upon a business model that Oracle considers illegal?

And, just as important, is this question: If Oracle keeps pursuing litigation in the third-party support arena, might that discourage other potential service providers from jumping in and creating more competition, which also means less choice for its customers and more reasons to stick with Oracle?

“This is a gray area,” says Ray Wang, partner for enterprise strategy at Altimeter Group. On one hand, Oracle has every right to protect its IP. Though, he points out, if Oracle and other vendors were serious about this area, they would work with third-party maintenance providers “to establish clear guidelines as to what would be the right way to deliver third-party maintenance in a way that would not infringe on [the software vendors'] IP.”

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