Application Hosting Contract

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					Oracle Hosting Services Providers (OHSP)
       Oracle Outsourcing Services

              Kirk Williams
         Frontier Consulting, Inc.
         Senior Oracle Consultant
  Vision Statement
 Reduce support costs of Applications and
  become Independent of internal IS staffing
 Outsource hardware expenses and support
  of servers along with Managed Disaster

               Frontier Consulting, Inc.       2
      Core Services
E-Business Suite - Managed Hosting
    Core Services Corporation
            June – 2003

         Frontier Consulting, Inc.   3
  Goal and Objective
 Introduction
 Win Win Objective – Customer and OHSP
 Bottom Line Impact of Financial Statements
 More Bang for the Buck
 Reduce Dependence of Internal Information
  Systems Staff

                  Frontier Consulting, Inc.    4
  Partners Working With Oracle

 Experience can pay off when working with
  Oracle Outsourcing with Implementations
 Issues working through a Migration:
  Partners can focus on Project Consulting
 Partners can relieve the Consulting
  Resource Burden

               Frontier Consulting, Inc.     5
     FAQs for OHSPs
1.   What is an Oracle Hosted Service
     Provider (OHSP)? What is an ASP?
    An Oracle Hosted Service Provider (OHSP) is a
     customer facing entity providing access to business
     applications, functions or processes on a
     subscriber basis from a centrally managed facility.
    An Application Service Provider (ASP) delivers
     advanced data center services to OHSPs by
     delivering the "power and ping", i.e., network
     components, hardware servers, security
     frameworks, and Oracle DBA services and often
     acts as second line support for the OHSP.
                   Frontier Consulting, Inc.               6
2. How does OHSPs define an Online
 OHSP’s can deliver our E-Business Suite of
  Applications over the internet as an Online Service.
  We deliver Internet-enabled applications faster, more
  economically, and more reliably than a customer
  implementing offline.
 A complete and simple Online Service includes
  Oracle Applications, Implementation, Oracle
  Education, Oracle Support and Oracle Hosting.
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  Cost Model
                                                                H ow M any       A v e r a g e C o st           T o ta l C o st           Y ears          1 Y r P & L Im p a c t
                                                                                                                                    A m o r tiz e d
N o te: 7 x 2 4 o r 8 x 5 ?
IT M a n a g e m e n t                                                   1   $       3 0 0 ,0 0 0 .0 0   $     3 0 0 ,0 0 0 .0 0                 1    $           3 0 0 ,0 0 0 .0 0
M a n a g e m e n t o v e rh e a d
A p p s A d m in istr a tio n
A p p s H e lp D e sk , T ra c k In sta n c e                            1   $       3 0 0 ,0 0 0 .0 0   $     3 0 0 ,0 0 0 .0 0                 1    $           3 0 0 ,0 0 0 .0 0
A c tiv ity , P a tc h M a n a g e m e n t (P ro a c tiv e ,
R e a c tiv e , M e g a P a tc h ), M a n a g e
C o n c u rre n t M a n a g e r, P ro b le m
R e p ro d u c tio n a n d D ia g n o sis, V a lid a tio n
/ T e st P a tc h e s w ith e n d u se r, M a n a g e
C h a n g e C o n tro l P ro c e ss
D a ta b a se A d m in istr a tio n
D B P a tc h in g , D B In sta lla tio n , S p a c e                     1   $       3 0 0 ,0 0 0 .0 0   $     3 0 0 ,0 0 0 .0 0                 1    $           3 0 0 ,0 0 0 .0 0
M a n a g e m e n t, C a p a c ity P la n n in g ,
T u n in g & P e rfo rm a n c e M a n a g e m e n t
S y ste m A d m in istr a tio n
In sta n c e C re a tio n , In itia l T e st E n v th e n                5   $       1 5 0 ,0 0 0 .0 0   $     7 5 0 ,0 0 0 .0 0                 1    $           7 5 0 ,0 0 0 .0 0
P ro v id e D e v a n d P ro d a s N e e d e d
P e rfo rm B a c k u p s, P e rfo rm R e fre sh e s,
O p e ra tin g S y ste m P a tc h in g ,M a c h in e
S ta rtu p & S h u td o w n
H a r d w a r e A d m in istr a tio n
T a p e M o u n tin g , N e tw o rk                                      1   $       1 5 0 ,0 0 0 .0 0   $     1 5 0 ,0 0 0 .0 0                 1    $           1 5 0 ,0 0 0 .0 0
A d m in istra tio n , P rin te r C o n n e c tio n s,
H W R e p la c e m e n t
S e rv e r H a rd w a re                                                 1   $         5 0 ,0 0 0 .0 0   $       5 0 ,0 0 0 .0 0                 3    $             1 6 ,6 6 6 .6 7
H W M a in te n a n c e                                                  1   $         1 2 ,0 0 0 .0 0   $       1 2 ,0 0 0 .0 0                 3    $               4 ,0 0 0 .0 0

TOTAL                                                                                                    $   1 ,8 6 2 ,0 0 0 .0 0                     $         1 ,8 2 0 ,6 6 6 .6 7

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  Lowest TCO
The average payback for an outsourced solution
was 1.33 years.

                  Frontier Consulting, Inc.       9
3. What are OHSP’s Online Services
  comprised of?
   Not only are Oracle Applications and Oracle Hosting
    included, but Implementation, Oracle Education, and
    Oracle Support can be purchased for a complete

                    Frontier Consulting, Inc.             10
         In As Little As Five Days
     Features 90% pre-configured Oracle-only applications
       and bundled services designed to be implemented
in five business days or less. Appropriate for customers with:

 Single Organization
 Single Set of Books
 Single Reporting Currency
 No Custom Interfaces
 Fixed Workflow Settings
 Pre-defined Chart of Accounts
 Single Language
 Pre-defined Reports

                     Frontier Consulting, Inc.                   11
                        30-100 Days
    Moderately alterable workflow settings on Oracle-only
       applications and designed to be implemented in
             approximately 30-100 business days.
                Appropriate for customers with:

 Single Organization
 Single Set of Books
 Single Reporting Currency
 No Custom Interfaces
 Fixed Workflow Settings
 Single Language

                    Frontier Consulting, Inc.               12
                           100+ Days
    Can be altered considerably and may include non-Oracle
      applications. Provides the highest level of flexibility
      and customization. Appropriate for customers with:

 Multiple Organizations
 Multiple Set of Books
 Multiple Reporting Currencies
 Customized Reporting
 Multiple Languages
 Global Consolidation Support
 Integration with Non-oracle Applications

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  Oracle Support

 Telephone Assistance available 24x7 (Global Toll-free Basis)

 Monitoring and Software Patches

 Electronic Services

 Oracle MetaLinkSM

 Online Support: Offers rapid solutions to problems, patches,
  and general application support)
 Oracle Guarantee: Any customer not satisfied for any reason
  during a given month will receive a 20% credit for that month's
  hosting fees

                     Frontier Consulting, Inc.                      14
  Oracle Education

          Includes comprehensive training,
         which varies by offering. May include:

 On-site Training done by Oracle University instructors

 Variety of titles from Oracle's extensive library of
  technology-based training CDs
 Oracle TutorTM (Tutorial Software)

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4. What is OHSP’s Online Strategy?

 OHSP’s online strategy is to deliver enterprise
  applications faster, more economically, and more
  reliably than custom solutions traditionally
  implemented in-house. The software industry is
  clearly moving from an off-line, assemble yourself
  model, to an online service model. In the near future,
  Oracle anticipates most business applications will be
  purchased and implemented online.

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5. What are the Benefits of using OHSP’s
  Online Services?
 Complete – OHSPs provide an end-to-end, world-class e-
  business technology solution including: Oracle Applications,
  Implementation, Oracle Support, Oracle Education and Oracle

 Simple - OHSPs provide the technical staff and hardware, and
  manages the applications, upgrades and servers. Through its
  professionally managed sites, Oracle drives the day-to-day
  tasks of the IT infrastructure, thereby freeing customers to focus
  on strategic business issues and core competencies.

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 Fast - OHSPs get customers to market quickly and reliably.

 Support – OHSP customers gain efficiency in Support
  Services. When Oracle’s online customers call in with
  problems, there is no “standing in line” while problems are
  reproduced, traced, and finally fixed. Instead, Oracle Support
  can go online and view which patch level the customer is on,
  where the problem is, and fix it in real-time.

 Attractively Priced - OHSPs provide ready access to
  industry-leading applications, with fewer IT issues, and with a
  decreased total cost of traditional deployment.

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                                   Core Services
                  An Oracle Applications Services Provider

•   100% Oracle Applications & Related
     •   Sun Microsystems
     •   EMC
     •   Cisco
     •   Checkpoint
     •   Optio
     •   Vertex
     •   Clear Orbit Bar Coding
   11 Years Oracle Partner
   59 Oracle Implementations completed
   52 Oracle Applications Hosting Customer

                                  Frontier Consulting, Inc.   19
 Deployed! – 50+ Customers

        NORTH AMERICA                           EMEA
           42: Apps                            5: Apps

                                                         ASIA PACIFIC
                                                           3: Apps

    2: Apps

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           Core provides delivery of enterprise applications and
           technology through a network hosted in a professionally
           managed environment.

   Data Center Locations
        Union, New Jersey
   Offices
        Union, New Jersey
        Chicago, Illinois
        Houston, Texas
        Orlando, Florida
        Beijing, China

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     Core Services – Selected by Oracle Corporation

Core Services is one of only 32 Oracle Authorized Service Providers. Hand picked and
approved by Oracle Corporation, the designation is Oracle’s highest partnership tier
for applications.

Oracle Awarded Core Services “Best Overall” for the Eastern US for year 2001.

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                              Why Host with Core?
                      TAR resolutions with Core Development

   Many times, Oracle Development requires additional information for
    troubleshooting purposes. These requests for information from Oracle
    Development are too often incomplete and fragmented.
   Core developers are versed at root cause analysis and can provide detailed
    bug descriptions to Oracle Development for faster turn-around times on most
    critical issues.
   Core has direct lines to many Oracle Developers. Core has worked hand and
    hand with Oracle Development solving issues for many customers. In fact,
    Core written code has helped Oracle Development solve customer issues.

                             Frontier Consulting, Inc.                          23
  Core vs. Oracle Outsourcing
“Since we left and are now with Core
Services; Core has shown us many improvements to
application setups and we are now reaping the
benefits of the system we thought we purchased; all
for a fraction of the monthly price.“

      Don Stiers – Power Medical Interventions

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               Scope of Services – Applications Management

• Installation
• Patch Application and Management with portal
    for customer inquiry
•   Patch Validation and Test in conjunction with
•   Problem Reproduction and Diagnosis
•   Concurrent Manager Management and
•   Mange Applications Object Library (AOL)
•   Manage Change Control Process
•   Manage Printer Setup
•   Software Release & Upgrade Planning
•   Oracle TAR Monitor and Resolution
•   Application Bug Alerts

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6. What are Oracle’s Hosting Services?

Availability Services
 Provision & Maintenance of Server Hardware
 Uninterrupted Power Source (UPS)
 Multiple Internet Connections
 Raid
 24x7x365 Monitoring

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Capacity Management Services

   CPU Memory Utilization Monitoring

   Database Utilization Monitoring

   Database Space Allocation Configuration

   Network Bandwidth Monitoring

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Security Services
 Defined User Account Creation

 Controlled Room, Root, D.B.and FTP Access

 Triple DES Encryption

 Firewall

 System & Database Performance & Tuning

 Automatic Notification of System Availability
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Production Management Services

   Scheduling & Managing Database Backups

   Log File Rotation & Analysis

   Aging of Reports and Logs

   Ad Hoc Restoration

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7. How much do OHSP’s Online Services
  cost? What are the factors that determine
  the range in prices, i.e., implementation
  timeframes, customization?

   OHSP’s Online Service pricing includes the cost of
  the Applications, Consulting, Support, Education and
  Hosting. A general price breakdown for Online
  Services is as follows:

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 Application: The application is owned by the
  customer. There are two types of licenses:
  Perpetual or Term. Pricing is also dependent
  on the selected application(s). For specific
  application pricing, please visit the Oracle
  Store at:

 Support: Support is 22% of the List License

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 Education: Education is a fixed price,
  depending upon the application.

 Consulting: Consulting fees are dependent
  upon the implementation.

 Hosting: Hosting is approximately 5% of
  license/month with a $12000 monthly
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8. How long will it take to go live with OHSP’s
  Online Applications?

 Implementation varies by solution.

9. How long is the initial contracted Hosting

 The initial hosting contract is a one-year term.

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10. What are my options once the Contract

 The Standard Contract can be renewed in one-year
  increments. Contracts are valid for one year and are
  non refundable and non cancelable. If the customer
  decides to bring the processes in-house once the
  contract expires, Oracle will provide a complete copy
  of the installed applications and technology software
  as well as all customer data.

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11. Who is responsible for my Patches?

 During implementation, the Authorized Implementer
  (Oracle Consulting or Authorized Implementation
  Partner) is responsible for the initial set up. Once a
  customer is in production, these tasks are performed
  by Oracle Applications Management Support
  Services (AMS).

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12. What are the Disaster Recovery

   OHSP’s execute incremental backups every day and
    full backups once a week. Additional backups are
    performed each time a database or major application
    modification occurs. These backups are securely
    stored on-site. Long-term storage is held off site for
    additional disaster recovery.

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13. What PCs do I need to access OHSP’s
  Online Services?
  Any computing device (PCs, Network Computers)
  with Java (v1.3 or greater) enabled browsers with the
  following recommended minimum configuration:
 Pentium III processor running Windows 98, 2000 or
 264 Mb RAM
 Java-compliant browser (Netscape 6.0 or Internet
  Explorer 6.0 and higher)

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14. Will OHSPs manage my Desktop

 No. The customer is required to operate and
  maintain your own desktop and LAN infrastructure.

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15. How do International Users interact with

   Customers with International Users should use their
    existing network infrastructure to connect to the
    customer’s Network Hub in the U.S. The U.S. hub will
    be connected to Oracle’s Data Center, and the
    international users can access the applications
    through this connection.

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16. Who is responsible for the Data Line
  from OHSPs to the customer site?

 OHSPs are partnering with telecommunications
  providers to deliver reliable VPN connections from
  OHSPs to the customer’s site with the proper
  specifications. The telecommunications provider will
  be responsible for the data line and will engage the
  customer in delivery.

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17. Where can I get more information?

   You can get more information by visiting the web
    sites of the Oracle ASP’s
   Also try web searches for Oracle ASP.

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             Oracle Applications
              Delivered Online
                Hosting Access Policies
        Oracle Outsourcing Services – Hosting Access
                   Revised February 2003
Standard Hosting Offerings
  Oracle will provide Data Center Hosting Facilities to support
  remote customer access within approved parameters
  established by Oracle and provided to the customer. This is
  subject to the customer's agreement of Oracle policies regarding
  hosting operations and the hosting of Oracle Applications.
  Oracle will define the hosting services network and systems
  architecture, and the specification of hardware and software

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Standard Hardware
  The Oracle Standard Server Configuration is designed to
  deliver optimal performance to each customer. As part of the
  standard hosting offering, Oracle will configure three printer or
  print server connections to support standard Hewlett Packard
  Model PCL 4 (and above) class printers. No other printer
  models are supported by the configuration. Each customer must
  provide an Internet Routable IP address for each print server or
  printer prior to configuration. Oracle will configure additional
  printers or printer server connections, provided that, prior to the
  configuration of such printer or printer connection, such
  customer (i) pays Oracle a one time set up fee of $1,000 for
  each additional printer or printer server required, and (ii) agrees
  to pay Oracle a yearly maintenance fee of $1,200 for each
  additional printer or printer server required.

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Standard Network
  The Oracle Hosting Network utilizes redundant firewalls
  configured to allow network traffic using the protocols, ports, and
  IP addresses originating from the customer router/Virtual Private
  Network (VPN).
  To provide our customers with a secure hosting environment,
  Oracle does not allow the following: (i) clear Internet
  connections to the customer's instance, (ii) Simple Network
  Management Protocol (SNMP) read only or write access to
  Oracle provided network equipment installed on the customer's
  premise, and/or (iii) analog dial up access to the customer's
  hosting environment.

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The Hosting Network is configured to facilitate prevention of
data theft and unauthorized network access.
For each customer, Oracle will configure a VPN Box for network
connectivity for one customer location. Oracle will configure a
VPN Box for an additional customer location, provided that prior
to each such additional customer location configuration, such
customer (i) pays Oracle a one time set up fee (including
hardware and configuration) of $5,000 and (ii) agrees to pay
Oracle a yearly maintenance fee of $1,200.
Each customer is responsible for the acquisition, configuration,
monitoring, maintenance and management of all hardware and
software at customer locations (except for the VPN Box
specified in the previous paragraph), including Local Area
Networks (LAN), computers, software, telecommunications, and
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Each customer can use its current Internet Service Provider
(ISP) to provide the network connection to Oracle.

Oracle will not be responsible for the network connection or for
issues, problems or conditions arising from or related to the
network connection, including but not limited to bandwidth
issues, network outages, and/or any other conditions that are
caused by the ISP and/or the network connection.

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Standard Service
  As part of the standard hosting offering, Oracle establishes the
  Database and Application Code Structure needed to facilitate
  hosting of the applications ("instance"). Three instances are
  established for each customer: Test, Development and
  Production. Substitutions cannot be accommodated. Once a
  customer has commenced "live" use of the Hosting Services,
  Oracle will monitor the test instance for the purpose of
  facilitating troubleshooting of issues. If, as part of a multi-phased
  implementation, an additional test instance must be established,
  or if a customer requests any other additional instances, the
  customer will be required to pay additional fees as follows.

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Oracle will establish additional Instances for a customer,
provided that, prior to the establishment of such instances, such
customer: (i) pays Oracle a one time set up fee of $6,000 for
each additional instance; and (ii) agrees to pay Oracle a monthly
maintenance fee of $2,000 per month, with a three month
minimum maintenance requirement, for each additional

Oracle will review and apply appropriate Operating System
Patches to support the hosting infrastructure. Application
patches are reviewed and applied on an as-required basis to the
production environment to facilitate a consistent and reliable
application environment.

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Application Upgrades
  It is the customer's responsibility to contract with an Authorized
  Implementer to perform application upgrades. Oracle will
  provide the Upgrade Environment (Network Access,
  Computing Environment, Storage, and access to the Application
  Code Tree) with a copy of the customer's production, test or
  development instance.
  Once the customer has completed the application upgrade and
  accepted the application functionality, the customer is then
  required to follow the Oracle Acceptance Criteria Process
  (specified in the Oracle Implementation Guide) for transition into
  production. Once the customer has accepted the criteria, Oracle
  will work with the customer and the Authorized Implementer to
  move the instance to the customer's production server.

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Standard Refresh Allowance

  As part of the Standard Hosting Offering, Oracle will reload an
  image copy of a customer's database files ("refresh") once per
  week per instance in implementation phase, and once per
  month in production phase. Oracle will allow a customer
  additional refreshes provided that, prior to each refresh, such
  customer pays Oracle $1,000.
  Oracle requires 48 hours notice for a refresh and customer must
  ensure that the instance is shut down and inaccessible by no
  later than 5:00 p.m. Pacific Standard Time. Refreshes are only
  available Monday through Friday. Refreshes cannot be

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Backup Policy
  Backups currently occur during the hours of 9:00 p.m. to 6:00
  a.m. Pacific Standard Time. During this time, all non-production
  databases are unavailable. A customer in a time zone other
  than Pacific Standard Time may request a different 9-hour
  Standard backups include data, databases, applications, and
  all configuration pieces required to restore the customer
  Production backups are run daily, weekly, monthly and
  annually and are currently retained for 15 days, 5 weeks, 13
  months and 8 years, respectively.

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Non-production Backups are run daily and weekly and are
currently retained for 15 days and 5 weeks, respectively. Non-
production special backups include:
1) two backups during the implementation phase;
2) two backups during pre-production testing; and
3) a baseline backup prior to production.
All non-production special backups are currently retained for 3
Oracle will run additional backups for a customer provided that
the customer gives Oracle 48 hours notice and prior to each
such backup, customer pays Oracle $1,000 for each additional

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Hosting Services

  Oracle’s Hosting Services are designed to be available 24
  hours a day, 7 days a week, 365 days a year, except during
  weekly system maintenance.

  A weekly system maintenance period occurs every Friday
  from 9:00 p.m. to 12:00 a.m. Pacific Standard Time.

  In the event that emergency maintenance is required, Oracle
  will use commercially reasonable efforts to provide advance
  notification of the maintenance.

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  Each customer is responsible for obtaining Oracle Program
  Licenses and Oracle Product Support and Update
  Subscription Service Support for licensed Oracle Application
  programs. In the event that Product Support or Update
  Subscription Service support terminates, hosting services will
  also terminate.
Incident Recovery and Data Restoration
  Oracle is prepared to expedite data recovery from backup media
  in the event of a system failure or urgent data restoration
  request. Data restoration times will vary depending on the
  severity of the problem and backup tape location.

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  Upon termination of hosting services, a customer will receive a
  data export, a list of patches that have been applied to such
  customer's Oracle programs, and copies of the following files:
  1) Application Environment Files
  2) $Appltop Directory Files
  3) Oracle Application Server Configuration Files
  4) INIT.ora files
  In addition, upon termination, the customer must return to
  Oracle all equipment provided or owned by Oracle.
      These Hosting Access Policies Are Subject to Change.

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 Online Services


Implement-                                   Production

        Initialization                Sales               New

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LifeCycle           Components

 Oracle Sales

 Business Operations



 Oracle Applications

 Implementor              Sales

 Oracle Education

 Oracle Support

 Oracle Hosting

                  Frontier Consulting, Inc.                                                             57 Services LifeCycle
                              10 – 120                 Time Line
                      CONTRACT TO GO
30 – 45 Days
   Sales       5 – 10 Days
               Initialization       5 – 120 Days
                                  Implementation      Days
                                                   Transition   Ongoing


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          Oracle Outsourcing
          Services LifeCycle
 Articulate the key components required to
  successfully implement and service an online
 Key Components Include:
      Life Cycle Phases
      Milestones in Online Life Cycle
      Timelines of Activities
      Roles and Responsibilities
      Methods of Communication between Organizations

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  Today’s Situation

 Increased Backlogs of Projects

 Dependence of IS Staff

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 Hosting Is Not for Every Customer
 Advantages & Disadvantages of Oracle
 Hosting Services
 Summarize Cost of Each Option

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Frontier Consulting, Inc.

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Description: Application Hosting Contract document sample