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Jean is a senior industry analyst focusing her research on server technology, storage technology, database software and the emerging market for Software Defined Infrastructure (SDI).

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Oracle Makes a Business Case for Cloud Computing

 

Oracle is stepping up its move to the cloud, positioning the Oracle Cloud public cloud as an engine for growing its overall enterprise business.

As more companies move workloads into hybrid clouds, and competition intensifies, Oracle has decided to play to its strengths in security, availability and workload performance. It has taken its own approach by leveraging its engineered systems, running in Oracle Cloud data centers – or in customer sites – as a differentiator in competing with other CSPs. 

Oracle knows it is competing with other cloud services that got into the market much earlier than it did: Amazon Web Services and Microsoft Azure. It also knows that Google Cloud Platform and IBM SoftLayer are working to grow share in the enterprise-focused hybrid cloud space. However, Oracle believes that large-scale migration of enterprise workloads is still in its early stages, giving it a large opportunity among customers planning to move enterprise workloads and business applications to public cloud providers.

In this competitive environment, Oracle is going directly to big customers, worldwide, with its Oracle CloudWorld events, recently held in New York and Seoul. It is positioning its deep software portfolio of Oracle databases, middleware and enterprise applications software as cloud service differentiators. In 2016, other CloudWorld events were held in China, India and Mexico.

What’s New

Oracle phased in its move to the cloud – working first on SaaS, and PaaS, before introducing a set of IaaS services in 2016. Its cloud revenue is growing, as it reported in its quarterly financials. Now, Oracle is still adding to its cloud services portfolio: As announced in January, Oracle introduced bare-metal-as-a-service, so that customers can run workloads on the Oracle Cloud service, in place of on-premises hardware systems. It is also expanding Oracle Cloud capacity by adding three more data centers – in Virginia, London and Turkey. That will bring the total number of Oracle Cloud data centers worldwide to 25, covering all time zones and major geographies.

Oracle’s focus on enterprise feature-sets is positioned to pay off in hybrid cloud and public cloud, as it works to grow share in the rapidly expanding cloud services marketplace. Oracle’s cloud strategy is maintenance of a consistent computing environment, with the same Oracle stack running on-premises, at customer sites, and inside the Oracle Cloud. Oracle calls this an “integrated cloud” stack engineered to work on-prem or off-prem.

 

Oracle CloudWorld in New York

At New York’s CloudWorld event on Jan. 17, Oracle CEO Mark Hurd made the business case for CXOs adopting Oracle Cloud. Beyond the technology, he noted, business managers want to learn more about the business value of adopting cloud services. Cloud adoption supports IT simplification and workload consolidation, as enterprise datacenters are combined, and workloads migrate, either on-premises or off-premises. Oracle intends to play in both spaces, using the same Oracle software stack – while leveraging Oracle engineered systems in the Oracle Cloud.

Customers speaking the New York CloudWorld event included New York City’s CTO – and IT executives from MetLife, Thomson Reuters, ClubCorp and Grant Thornton, among others. They cited the flexibility they have with cloud services, to test new applications, to deploy more instances quickly, and to pay for capacity, as it is used.

 

Making the Business Case for the Oracle Cloud

The depth of Oracle’s commitment to cloud computing can be seen in Oracle’s investment levels in cloud technology, its re-write of Oracle Fusion applications for cloud-based workloads and its deep applications portfolio. All of that says that Oracle will be a long-run provider in the hybrid cloud market – and that it plans to replicate its earlier successes in enterprise database and enterprise applications with enterprise plays in the cloud computing marketplace.

The leading arguments in Oracle’s enterprise case for the cloud include:

  • Data-centric focus on cloud computing, starting with hybrid clouds linking on-prem and off-prem systems. Data migration can, and often does, end up with entire applications running on the Oracle Cloud. Oracle’s offering include many analytics and data-management capabilities.
  • Leveraging Oracle engineered systems for on-prem or off-prem (with OracleCloud public cloud) use. This allows Oracle to manage the systems in the same way, regardless of location within a hybrid cloud.
  • Leveraging Oracle enterprise applications. Oracle has a portfolio of hundreds of cloud-based and on-premises enterprise applications, such as ERP, HCM, SCM and others. Oracle acquired dozens of companies over the last 20 years – including PeopleSoft, J.D. Edwards and others, growing its inventory of Oracle Applications. It then spent nearly 10 years re-engineering them into the Oracle Fusion Applications, for both on-premises and SaaS-based deployment, based on Java-enabled code, to link apps together and support unified management of applications.

 

Business-Centric Services

In terms of Oracle’s software products and services, there is a multi-faceted strategy to position Oracle as a unifying element of hybrid cloud deployments. Oracle’s positioning includes the following:

  • Positioning a broad inventory of packaged business applications, including Oracle’s on-premises E-Business Suite, as well as applications acquired by Oracle from enterprise software companies (e.g. PeopleSoft, J.D. Edwards) – and now adapted for hybrid cloud.
  • Appealing to longtime Oracle Database customers who plan to move at least some of their mission-critical workloads and data to hybrid cloud.
  • Outreach to new customers, including cloud-native developers and enterprise developers, and working to gain competitive wins in IT organizations that have multi-vendor data centers that run Oracle.

 

Summary

Cloud adoption is accelerating in many organizations, across the board. For Oracle, it will be important to extend its reach to new audiences beyond the Oracle installed base, emphasizing its enterprise-centric delivery for business databases and business applications with OracleCloud. We expect Oracle to continue its outreach to new cloud-services customers, through Oracle CloudWorld Events, Oracle OpenWorld and through direct and partner sales efforts, throughout 2017.

 

 

 

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Bozman HeadshotJean S. Bozman is a seasoned industry analyst with more than 20 years of experience as a consultant and industry analyst focused on the worldwide IT markets for databases, servers, storage and software. Jean's full bio

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