Explanation
Why the waste happens and who it affects.
Oracle's terms are strict: credits must be used during the yearly credit period and expire at its end, and any prepaid unused amount is nonrefundable and forfeited. When a commitment is sized on a migration plan or growth forecast and a migration slips, a workload is retired or moved, or an optimization program lowers consumption, the remaining balance is lost at the end of the period.
This is the opposite failure from overage, where usage above the commitment is billed per the contract's negotiated terms, and it is easy to miss because nothing fails or alerts when consumption runs behind plan. Every optimization that lowers consumption without a matching change to the commitment adds to the forfeited balance.
Billing model
The pricing dimensions that drive this cost.
Annual Universal Credits apply to eligible IaaS and PaaS services in any region, with a minimum term of 12 months.
- Annual commitment
- An annual pool of funds billed in advance and debited monthly based on actual usage
- Credit period
- Credits must be used within the applicable 12-month period; unused prepaid amounts are nonrefundable and forfeited
- Overage
- Usage after the committed amount is consumed, charged per the contract's negotiated terms and billed separately
- Burn-down rate
- Consumption is metered against the credits at the rate card prices, specified on an hourly basis
How to detect
4 checks to find it in your estate.
- In Cost Analysis, open View subscription details to see Commitment, Consumption, Balance and Days elapsed in billing for each subscription, or use the Cost analysis home page widget for credits used against the total and days elapsed
- Compare the share of the commitment consumed with the share of the credit period elapsed; a consumption share well below the time share signals a projected forfeiture
- Use Cost Analysis with Show Forecast (at least ten days of history needed) and group by Subscription ID to project end-of-period consumption against the remaining balance
- In organizations with child tenancies sharing a subscription, review consumption from the parent tenancy, which sees commitment details for all child tenancies
How to fix
5 ways to remove the waste.
- Pull forward planned, genuinely needed work onto OCI within the credit period, such as scheduled migrations, disaster recovery environments or proofs of concept, rather than consuming credits on resources with no business use
- Size the next commitment from measured baseline consumption and the confirmed pipeline of workloads, not from the original migration plan, and account for planned optimization savings
- Discuss commitment timing, term length and amount with Oracle before the end of the credit period, and review the contract for any negotiated provisions on unused credits, since the standard terms forfeit them
- Set up budgets with forecast-based alerts per compartment so owners see consumption trends early, and review the subscription balance monthly rather than at renewal
- Before adding other commitment types, such as a Cloud Advisor Continuous Consumption Discounts (CCD) commitment, check existing CCDs and credits so commitments do not overlap
Documentation
Vendor references for pricing and configuration.
