By John Soat
Oracle Executive Chairman and CTO Larry Ellison announced more than 24 new cloud services that give Oracle the world's broadest and deepest portfolio of SaaS, PaaS, and IaaS.
“We’ve entered a new era of cloud computing,” Larry Ellison, Oracle’s executive chairman and CTO, told a rapt audience at company headquarters in Redwood Shores, California, on Monday, June 22, 2015. He then laid out the company’s next cloud surge—into both platform as a service (PaaS) and infrastructure as a service (IaaS), complementing Oracle’s already successful software-as-a-service (SaaS) business.
“It’s Oracle’s strategy to play at all three layers of the cloud,” Ellison said. Indeed, the company plans to offer not just services in those three areas, but also to make them work together seamlessly so that “everything can be moved from your data center to the Oracle Cloud easily, with the push of a button,” he said. That’s because the new cloud era Ellison referenced represents a “coming decade of coexistence” between systems companies run internally and those that run in the cloud.
In the PaaS and IaaS segments, Oracle now offers more than 24 new services, including cloud versions of its database and programming tools, as well as new high-performance network and storage services. “We are now prepared to call our platform and our infrastructure services complete,” Ellison said.
It’s Oracle’s strategy to play at all three layers of the cloud.
—Larry Ellison, Executive Chairman and CTO
Ellison could not pass up the opportunity to tout the company’s cloud success, which was demonstrated by $426 million in new SaaS and PaaS bookings in the company’s Q4 FY2015 that ended May 31. The number represents a 200 percent increase from the year-ago quarter, he said. In SaaS by itself, “we have the largest portfolio of products and we’re growing incredibly fast,” he said. Those products are characterized by integrated suites of cloud applications that include enterprise resource planning, enterprise performance management, human capital management, customer experience, supply chain, and, as the last major horizontal cloud suite, manufacturing, which Oracle plans to introduce later this year, Ellison said.
Ellison discussed new Oracle Cloud Platform services in several major areas:
Oracle Cloud Platform provides all the benefits of cloud with complete, integrated, secure solutions at every layer of the technology stack.
These business integration services “endow all of your applications with social characteristics,” Ellison asserted. Those characteristics are important in a process-oriented environment, just as they are anywhere in business, because social networks are “the modern way people collaborate, share information, work together,” he said. “We have those tools to enable you to build modern applications that are both social and mobile, and simple, and in the cloud.”
In terms of Oracle’s IaaS layer, “the biggest missing piece has been compute service,” Ellison said. To that end, Oracle Cloud now offers compute services that will run any application, Oracle or not. “If it runs on a computer, you can deploy it in the Oracle Cloud,” he said. Oracle Cloud “dedicated” compute services deliver predictable performance—a specific level of service, access to a specific number of cores—“so that noisy neighbors won’t steal cycles and make your quarterly results run slowly,” Ellison said.
Oracle’s IaaS offerings also now include networking options such as VPN and direct connect, as well as high-speed, high-performance data networking and storage capabilities for migrating large data sets to the cloud. “As companies move more and more data into the cloud, these clouds have to be able to accept this data at a very, very high data rate,” Ellison said. “So we have tools that allow you to stream enormous amounts of data to the cloud and we can ingest that data—we can import huge amounts of data, moving data from your data center into our cloud.”
One way company differentiates Oracle Cloud Platform—and its cloud services overall—from its competitors is through standardization. “Everything we do in all three layers of the cloud is based on industry standards,” Ellison said. “This is very different from other clouds in the marketplace. We learned over decades with on-premises technology that standards were very important, that interoperability was very important, that upward compatibility was very important.”
Oracle’s use of industry standards includes, of course, its relational database (SQL) and application development (Java) environments. “All of our applications are written in Java,” Ellison said. At the infrastructure level, standards include the OpenStack platform, the Linux operating system, the Xen open source virtual machine hypervisor, and NFS (Network File System) version 4, a standard protocol for accessing large data files over a network.
It’s worth noting that Oracle’s competitors in the cloud are different from those in the on-premises software segment. Today, Oracle competes mainly with Salesforce.com and Workday in SaaS, and with Amazon Web Services in IaaS. The one competitor it sees regularly in both on-premises and cloud (PaaS) segments is Microsoft, Ellison said. It's "only us and Microsoft that span both," he said.
Ellison took pains to differentiate Oracle Cloud Platform from Amazon’s offerings. “Amazon.com is primarily an infrastructure-as-a-service provider,” he said. “PaaS is much different than infrastructure as a service,” he said. That means, among other factors, that while Oracle won’t necessarily match Amazon Web Services in pricing for certain cloud services, Amazon can’t match Oracle’s extensive cloud platform toolset and services, especially in terms of value-adds such as automatic provisioning and patching. “We have a high degree of automation,” he said.
But Oracle is willing to go toe-to-toe where such competition makes sense. He noted that Oracle charges one-tenth of what Amazon charges for storage. For high-volume enterprise customers, that’s a significant difference. “For every 20 petabytes of storage archived, you save millions of dollars compared with Amazon,” he said.
You can push a button and move an application from on-premises into the cloud. And by the way, you can push a button and move a database from the cloud back on premises.
—Larry Ellison, Oracle Executive Chairman and CTO
With this new set of Oracle Cloud Platform offerings, the company now has a complete suite of services for creating and managing applications in the cloud. “We now have all the boxes filled in,” Ellison said. “What that means is that you can take any of your workloads that are on premises and move them into our cloud.” It doesn’t mean, he was quick to point out, that Oracle will stop working on these tools and services. “We will continue doing interesting things, we will continue to improve things,” he said. “But all the major pieces are there.”
It’s important to understand that Oracle Cloud is 100 percent compatible with the technology the company offers for on-premises use, Ellison said. It’s not just the same architecture, infrastructure, and standards—it’s exactly the same products running in both places. “That means you can push a button and move a database from on-premises into the cloud,” he said. “You can push a button and move an application from on-premises into the cloud. And by the way, you can push a button and move a database from the cloud back on premises.” That ability gives organizations more cost-effective control over cloud development and deployments, as the cloud finds its best fit in enterprise IT infrastructures.
“This is our strategy in the cloud, to deal with this coming decade of coexistence between on-premises data processing and cloud data processing,” he said. During this decade, organizations are going to have to manage both areas of data processing, as well as the migration of data and applications between them, Ellison said. “We’re going to give them the tools that make that easy.”
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Statements in this article relating to Oracle's future plans, expectations, beliefs, intentions, and prospects are “forward-looking statements” and are subject to material risks and uncertainties. Many factors could affect Oracle's current expectations and Oracle's actual results, and could cause actual results to differ materially. A detailed discussion of such factors and other risks that affect Oracle's business is contained in Oracle's Securities and Exchange Commission (SEC) filings, including Oracle's most recent reports on Form 10-K and Form 10-Q, particularly under the heading “Risk Factors.” Copies of these filings are available online from the SEC, by contacting Oracle's Investor Relations Department at (650) 506-4073 or by clicking on SEC Filings on Oracle's Investor Relations website at http://www.oracle.com/investor. All information set forth in this article is current as of June 24, 2015. Oracle undertakes no duty to update any statement in light of new information or future events.