Larry Ellison and his executive cohorts are striving to make Oracle the #1 cloud provider of software-as-a-service (SaaS) and platform-as-a-service (PaaS) solutions. During his Oracle OpenWorld keynote address, Ellison stated that two of Oracle’s primary competitors in this market are Salesforce.com and Workday. He further went on to say that traditional legacy vendors like SAP and IBM never show up to the competitive dance in the new SaaS and PaaS cloud economy.
To “cloudify” their application and database portfolio, Oracle spent the last ten years (Project Fusion) modernizing ERP applications like JD Edwards and PeopleSoft so that they can be consumed in the cloud as SaaS. Likewise, Oracle’s ubiquitous database platform has also been made available in the cloud. Offered as a database-as-a-service (DBaaS) solution, end-users can quickly spin up an Oracle 12c database instance in the cloud to satisfy a number of important use cases.
While at Oracle Open World 2015, I sat down with several Oracle partners and clients that are leveraging Oracle’s DBaaS solution. What I learned is that this service is making it possible for Oracle’s partners, on the one hand, to launch application services in the cloud, using Oracle 12c as the back-end database, to help their customers with use cases ranging from development and test, through training and education, as well as running production application services in the cloud. Oracle customers benefit by increasing their time-to-market and saving on capital and operational expenditures while Oracle partners can more quickly monetize their products and services.
DBaaS could be a strong offering for Oracle given the fact that many businesses are looking for ways to speed up application development cycles and launch new services more quickly to increase their competitiveness. In addition, those organizations that don’t have the capital to build out dedicated database infrastructure and hire highly skilled database administrators on-premises to manage these environments may find Oracle’s DBaaS a financially compelling alternative.
Check out this video where I recap Oracle OpenWorld 2015.
Late night last night. I've lost my recorder here. Last night was the appreciation event, Oracle OpenWorld 2015, one of the better events I've been to. Elton John, rock legend, opened up and then one of my personal favorites, Beck, finished the evening.
Here we are in the Oracle Village, here at the Moscone Center, much depleted, not many people left. But it was a very interesting week. Obviously cloud is now a very big theme with Oracle. It has been for some time. And I think that's what they're trying to get across to people, is that we're not just a database company. We do cloud.
Larry Ellison opened up as keynote, talking to that, saying that they modernized their application portfolio over the last 10 years under Project Fusion. And it seems to be bearing some fruit. Case in point, 70% of Oracle's cloud customers are net new Oracle clients, meaning they had never purchased an Oracle product before. And this actually has given them the reach downstream, so we know that their place in the enterprise is pretty significant. Forty-five percent market share, at least from a database platform perspective.
With the Software-as-a-Service solutions that they offer, many of the ERP technologies, like PeopleSoft and JD Edwards for example, are now consumable in the cloud. And they're starting to see a number of clients, particularly down markets, small to medium-sized businesses, purchasing these solutions.
Let's look at Database-as-a-Service. That can also be consumed in the cloud. In fact, while I was here, I had some meetings with some clients that are using this technology. And quite frankly, it makes a lot of sense, particularly again, for those businesses that don't have either the financial wherewithal to go out and start provisioning infrastructure, buying licenses, in short, having this dedicated environment that they may be priced out of. It gives them an avenue to deploy databases for various applications.
And in addition, if you think about the shortage in IT skill sets, we at ESG have been tracking this for a while. Trying to find good database people is tough because typically the bigger guys go out and snatch those guys up. So you basically put all those concerns to bed when you deploy a Database as a Service solution.
Let's think about some use cases. Some easy ones, test and development. If you have developers that need to launch database instances] in the cloud, they can do so with Oracle's Database-as-a-Service platform. They can build up an environment, tear it down to do their application development.
One of the companies that I talked to provides health care application services, so patient billing, medical records, all that type of stuff. And what it's allowing them to do is to monetize their assets quickly because they can put their customers in the cloud using their application with the Oracle Database as a back end a lot more quickly. So the customer gets the benefit of lower costs, quicker time to market. The application provider gets the benefit of being able to monetize assets and have a consistent environment that's going to perform well. It's got Oracle backing it.
So you have all the expertise of the optimized Oracle Database Platform in the cloud, using some of these newer technologies we're hearing now, especially with respect to security. Oracle has embedded security now into database memory. They can also encrypt data for Data at Rest and for Data in Flight, so all these ancillary services that you get as well, that you would otherwise have to do yourself. So I think businesses that are looking for more consumable ways to deploy application services may find Oracle's Database as a Service offering very attractive.
So with that, signing out here. Six hour flight ahead of me. You probably don't want to be me right now, but it's all good. Thank you.