Two years ago this week, Larry Ellison was vilified for skipping his Oracle Open World keynote address so that he could attend the Americas Cup yacht races in San Francisco bay. What many probably didn’t realize at the time was that Team Oracle was on the verge of an historic comeback against the Royal New Zealand Yacht Squadron. Down 8-1, Team Oracle had to win an unprecedented 8 consecutive races to secure the highly coveted trophy from their “Kiwi" rivals. This seemingly implausible victory can be attributed to two key factors - bleeding edge technology coupled with a crew of top flight world class sailors. In perhaps an Ellison-esque retributive gesture, the 72 foot long catamaran behemoth was somewhat gaudily displayed smack in the middle of the Moscone Center plaza at Oracle Open World 2015.
The winning AC72 (American’s Cup 72 class) wing sail catamaran serves as an apt analogy of Oracle’s driving ambition to be a premier provider of hybrid cloud infrastructure and application services. The AC72 sailing crew had to overcome insurmountable odds to capture the America’s Cup. Similarly, Oracle has considerable work to do to close the cloud market share gap with their competitors. While the cloud presently only accounts for a meager 4% of their annual revenues, Oracle is pouring copious amounts of cash into their cloud R&D budget ($5.2B) to transform their business.
In fact, Ellison pointed out that thanks to a decade-long initiative dubbed “Project Fusion”, 95% of Oracle’s software products have been re-designed and modernized for the cloud. This includes Oracle’s ubiquitous database platform, ERP products like People Soft and JD Edwards, business analytics and a bevy of HR, content collaboration, mobile and customer relationship management offerings (amongst others). And now with a new Infrastructure-as-a-Service (IaaS) offering, Ellison claims that Oracle is only one of two cloud providers (Microsoft being the other) that has offerings across all three cloud layers - SaaS, PaaS and IaaS.
While Oracle may be late to the public cloud party, their 45% database market share position gives them a considerable springboard, particularly across enterprise shops, to sell their cloud solution offerings. And Oracle, like most technology vendors, is emphasizing that hybrid cloud will be the new normal (at least over the next decade) for most businesses. The hybrid cloud meme is certainly nothing new so how is Oracle differentiating their hybrid cloud solutions? In short, Oracle claims that since they have the widest depth and breadth of hardware and software solutions in the industry, they can provide the type of consistent and seamless hybrid cloud experience that businesses need, to get the most value out of their private and public cloud investments.
This idea isn’t without merit. If you own the entire hardware and software stack, you can innovate top to bottom across that stack to optimize business application performance whether it runs on-premises or in the cloud.
And Oracle has that – a highly secure, end-to-end virtualized computing infrastructure portfolio of engineered systems that can start small and scale-out across hybrid cloud. These systems can be used to support Oracle specific and/or 3rd party applications but Oracle is making it clear that their software solutions will run more optimally on their platforms (and for less money) than they will on competitive converged infrastructure and "do-it-yourself" platforms. Moreover, Oracle has an extensive portfolio of SaaS software offerings that can be integrated with on-premises applications and databases to support data analytics and business intelligence initiatives.
By operating the same optimized infrastructure stack on-premises and in Oracle’s public cloud, Oracle is making a pretty convincing argument that businesses can eliminate the complexity and risk of operating in a hybrid cloud environment because everything is fully compatible. This can enable businesses to simplify operational management, lower infrastructure costs, speed up business innovation through enhanced Dev/Ops capabilities and achieve greater workload mobility to and from the cloud.
Of course, this brings up the dreaded spectre of vendor lock-in. If I put all my eggs in the Oracle basket, they own me. First, there’s nothing precluding IT planners from using their existing 3rd party infrastructure in tandem with Oracle’s public cloud, they just wont be able to get the benefits of a fully optimized stack. Secondly, Oracle supports running their application workloads in AWS and other cloud service providers, so there are exit options, if you will, from a public cloud consumption standpoint.
The larger issue here is that many businesses are desperately trying to simplify how they operate their IT environments so that they can focus on business innovation, reduce costs and enhance their competitiveness. It’s hard to achieve all these things if you’re bogged down with managing piece part IT infrastructure. Oracle is claiming their optimized hybrd cloud solutions can help buisnesses attain all of these benefits and in most instances, do so at a much lower cost. This could be the winning formula that Ellison and team Oracle needs to catch up in the cloud race.