Oracle to Amazon: It’s on

http://gigaom.com/2013/12/26/oracle-to-amazon-its-on/

by yogo • 13 years ago

41 55 13 years ago

gigaom.com

actionscripted• 13 years ago

Me to OP: what's on?

moomin2• 13 years ago

It's a term for "I'm going to fight you."

drivers99• 13 years ago

http://www.urbandictionary.com/define.php?term=It%20is%20on

"This phrase is used after a bet has been made."

kylelibra• 13 years ago

Seems like this can only be good for consumers.

adventured4• 13 years ago

Assuming it doesn't lead to a wave of lawsuits and general anti-consumer behavior as Oracle tries all means at its considerable ($11b profit, $39b cash) disposal to 'compete.'

mitchty2• 13 years ago

Oracle and affordable in the same sentence?

Sure Ellison, sure.

freehunter• 13 years ago

I don't know of any company (mine included) that uses Oracle because they want to. I always hear talk about reducing our dependency on Oracle at the same time we're moving more and more mission-critical and high-performance applications to RAC and Solaris.

mitchty2• 13 years ago

We're migrating away from Solaris here, and more to their grid stuff. My point is more the cost is insane. That and the level and response I get from "support" personnel can vary from decent to "what do we pay you people for".

I've had better support experiences when I can dig into the source, say linux or a kernel module, or a driver and figure things out on my own while I wait to get punched through various level 1/2/3/etc.. support people. I vastly prefer open source for this reason alone, with oracle stuff, its basically a black box that barely works if you look at it wrong. This is with everything fully automated mind you, I still see jenkins test failures where installs will not work seemingly at random. I can debug or retry the job and it'll work. Its my most hated piece of software right now.

moomin2• 13 years ago

I think new entrants to the space have no idea how hard it is to take on amazon here. Microsoft are getting a clue fairly rapidly, Google seem to have just decided to cede the space.

ChuckMcM2• 13 years ago

Can you say more on : "Google seem to have just decided to cede the space." ?

My take on it was that Google's pride in their own engineering would not let them do that. They seem to be in it for the long haul here.

toddmatthews• 13 years ago

google has not ceded the space, they just have a different solution

https://cloud.google.com/products/compute-engine/

mbesto2• 13 years ago

the real dough lies in Software as a Service (SaaS) and what Ellison called a “highly differentiated” Platform as a Service (PaaS) that will provide it Oracle-like margins on enterprise applications.

I call bullshit. No one is making "Oracle-like margins on enterprise applications" in the cloud...yet...not anytime soon in this competitive market.

This is the opportunity in IaaS/PaaS as I see it: every large company in the world typically outsources their operations systems infrastructure. Here's an example - a company based in Europe that does €7b in revenue. Let's call them Big, Co. They have a myriad of technology partners - Oracle, SAP, HP, IBM...you name it, they have it. Anyway, one of their partners, Atos, provides infrastructure services for them based in Austria. So, let's say the CIO decides that the HR department is going to use SAP HCM to support HR. Some manager at some level calls up Atos and says "Alright we need 6 HP ProLiant servers, Oracle 10g installed on 3 of them, and SAP HCM installed". This process takes months. To everyone in the web world who's unfamiliar with enterprise - this is the equivalent of installing a LAMP stack on EC2. So you can see the disparity between the two (months vs minutes). The problem is - none of the enterprise technologies (Oracle 10g or HP ProLiant blades for example) are sold as commodities...they're "professional" and "enterprise grade". So here's the opportunity - do what Amazon did for the web in the enterprise. So, let's say you want SAP HCM, well that's simple, have support spin you up a server with a pre-installed set of technologies (like a LAMP stack!) and then let some implementation managers go and install it. Here are the problems for Oracle (and pretty much anyone at this point):

1- Cross-platform ecosystem is shit when it comes to APIs (integration is normally much bigger of a challenge than the implementation itself)

2- Oracle isn't good at integrating all of it's "parts". They have a strong hardware/OS company (Sun), a strong db brand (oracle), and very strong best in breed software (Peoplesoft, etc), but they've been working in silos their whole lives. It isn't their strong point to do integration (just as SAP has been abysmal at acquisitions)

3- The margins absolutely suck in SaaS. Look at Salesforce, Workday, Amazon, etc. They are all negative or razor thin. Oracle and SAP are used to 85% gross margin on software. This will take a lot to gut (mainly from stockholders)

dj_axl• 13 years ago

Look at Salesforce, Workday, Amazon, etc. They are all negative or razor thin. Oracle and SAP are used to 85% gross margin on software.

Workday has a profit margin of 62% versus Oracle's profit margin of 82%. It's less but it's not that big of a gap.

mbesto2• 13 years ago

Huh? Workday has never turned a profit... and AFAIK do not report gross margins (for support contracts) the same way SAP/Oracle do...

https://www.google.com/finance?cid=401330883723564

ChuckMcM2• 13 years ago

I did not realize that Oracle was in this much trouble. In my experience companies that are circling the drain put out press releases that say "Hey <leader of some technology that is hip> we're going to take away all your business with our version of your same technology that we just figured out how to build, sort of." Stepping into this mess is not something the Oracle organization has the DNA for.

I grant you my experience with them is dated (they were a huge part of the NetApp push into data base markets) but they were all about the 'added value option' and high touch management / maintenance. Not something cloud compute is about.

To my way of thinking it seems like step one here, would seem be build a PUE < 1.05 data center with 10MW of provisioned power. Have they done that?

adventured4• 13 years ago

Oracle isn't in any trouble, clearly. Their biggest problem appears to be figuring out how to spend the $39 billion in their bank account, while they print another $11b per year.

They have the financial resources of Google, dwarfing Amazon in that regard. I don't think any of this will be decided by who has large data centers - that's a commodity that can be acquired at will when you're talking about companies with tens of billions in the bank. This will all come down to execution.

loceng• 13 years ago

Most big companies have this trouble. Once you start to direct that amount of funds into a strategy there really is no going back.

aquadrop3• 13 years ago

I don't think Oracle dwarfs Amazon at all. They are comparable in size an Amazon is growing fast. And Amazon have 5+ years of experience in the field, they have special hardware, they know how to do it cheap and well. You can't get that fast, even if you have spare billions. This race will be tough for Oracle and they might need a few years to catch up with Amazon.

dekhn3• 13 years ago

Oracle is stuck in a classic innovator's dilemma.

They can't afford to cannibalize their existing cash cow.

marktangotango• 13 years ago

All Oracle needs is the upcoming multi-tenant jvm (Java 9, IBM jvm already has it supposedly). Then your iaas becomes jaas (jvm as a service) with any jvm language/platform you care to mention.

spullara• 13 years ago

Waratek is an interesting JVM that does this today.

gaius• 13 years ago

The multitenant stuff in Oracle 12c is actually pretty good, and JRockit is a great JVM.

bane• 13 years ago

Oracle has got to be struggling to meet internal growth metrics. They've clearly lost out on the low and medium dB market with so many very good and cheap/free (beer and freedom) choices. In the "internet-scale" market they aren't really offering much leaving them flanked into the large corp market.

That's still a very lucrative market, but I would guess that options from both the low and high end are starting to erode new sales opportunities and they might be losing some outright. e.g. it used to be the default in government IT systems to just stamp in "Oracle dB" in high level architecture diagrams and not get fired, but now postgres and other alternatives are being seriously considered and used.

"Oracle dBA" is being replaced with "dBA with experience in X, Y and Z databases" in many job reqs as well.

They still have huge enterprise license agreements, particularly in the fed space, but as budgets get cut those are simply being reconsidered.

This isn't really a move for "today", but for where Oracle will continue to vector if nothing is done over the next 3-5 years.

wglb• 13 years ago

I am not seeing how this indicates that Oracle is in trouble. What about this effort leads you to think so?

coldtea3• 13 years ago

The BS, me-too, antagonistic press release.

jbuzbee• 13 years ago

I was expecting to read that a new round of lawsuits had been filed as it seems that is the only way these big companies "compete" these days. At least they are trying to compete on an actual product instead of just suing using a bunch of patents they bought for that purpose. Of course if competing fails, you can expect the lawsuits to follow...

dredmorbius2• 13 years ago

Of course, Sun had its own Cloud offering pre-aquisition (SunGrid). Though it didn't seem to be particularly successful / popular at the time (I had a journalist reach out to me to ask if I actually knew of anyone using it at the time of the merger).

Many of the staff and execs left shortly after -- Lew Tucker in particular, February, 2010.

dekhn3• 13 years ago

At the time I believe it was called "utility computing". I think they were a few years ahead of the curve, and far too dependent on their own hardware platform, for it to be a viable product.

Amazon hit at the right time: virtualization as a concept was being adopted by developers, storage needs were going through the roof, classic storage systems weren't scaling at reasonable costs.

Amazon's other strength is that they can use the massive revenue they have sitting around for short periods of time to build out their computational infrastructure (turning their operational revenue into capital spending). IaaS took off; SaaS somewhat, and PaaS almost not at all (except in a few well defined areas).

I can't really see what oracle woudl bring to the game. It looks to me like they are just making a play to take their existing customers and move them to their data centers.

dredmorbius2• 13 years ago

I'm not discounting your criticisms at all. Yes, data processing services have existed for a long time -- EDS offered this as a business model on mainframes rather famously. And while good at it, they were also highly despised for their contractual and service terms. I worked in the 1990s at a site making use of Everyone Dresses the Same, and there was a tremendous amount of friction, as well a strong internal incentive to get away from the service, however contractual obligations largely prevented this. A cautionary note to those presently looking at cloud services, though the lock-in's much smaller.

Sun faced multiple challenges, largely being a legacy product with legacy offerings in a world where price point was key, their service commanded a premium, and much existing infrastructure wasn't positioned to properly capitalize on it. That's just off the top of my head, though I'd be interested in seeing what other factors accounted for the failure.

Oracle has the kiss of death for far too much in my book. I'd consider any offering it presented with extreme reluctance.

jtchang• 13 years ago

While I'm not exactly a fan of Oracle I wouldn't dismiss them so easily.

Due to business reasons there are lots of applications that companies would rather not put outside their own network. Some that come to mind include HR, payroll, and billing.

Maybe Oracle can capture some of that value in the form of data center as a service?

mackey3• 13 years ago

I worked for Oracle for a little while after getting acquired.

For a developer, there are so many obstacles you need to overcome to ship anything on time there or of quality. Everything is bad, from the developer hardware/tools to the red tape.

The bug tracking system looks like an HTML 1.0 web page. The "database version" is a required field, even though the product you work on doesn't even use a database. I seem to remember having problems linking to issues, because the the URL was just a hashed session so you couldn't even bookmark things.

You want to use that open source library that everyone else is using and does exactly what you need? All you need to do is fill out a bunch of on-line forms where you explain the material impact of using this library and how much money your BU makes and how this affects the bottom line. Once you get through all that, your request needs to travel all the way up the food chain to the office of the CEO which can take months of harassing administrative assistants of very highly payed people for that to actually happen. This doesn't even take into account the legal approval steps that need to happen which also takes a while.

While this is going on, you have to work with your 3rd party library and hope that it gets approved or risk months of wasted work. In the end, you notice that other people don't even try and use 3rd party libraries because it's so frustrating. In the end they just try and re-invent the wheel, and because a certain percentage of your team has to be in a "low cost center", the library ends up sucking.

Recap: Amazon has nothing to worry about, because nothing innovative or powerful is going to come out of Oracle.

tlogan• 13 years ago

I agree that development is challenging in Oracle - depending on org you end up working for.

But, you might have basic misunderstanding of Oracle as a whole and position in the market. Oracle is an excellent acquisition and integration machine: They did excellent job with BEA, PeopleSoft, Sibel, GoldgenGate, etc. That is the key of Oracle: very well tuned system (marketing, support, sales, engineering, DDR, etc.) which can make a lot of money in enterprise environment.

mackey3• 13 years ago

"Excellent acquisition and integration machine"? From who's perspective is this? The customer? The employees?

From employees perspective:

At least in my org, integration is still sputtering along almost 2 years after I have left. Oracle bought another company shortly after us that we had to integrate with, in addition to Oracle proper. Over the last 2 years, most of the more competent engineers have left because they couldn't take the work or environment anymore. The end result was more work for everyone else and inability to find new employees due to the hot market. New feature development are practically non-existent.

On the non-technical side, there was nothing excellent about integration. We lost vacation time/holidays. We didn't have wireless for probably 6 months at the office because our wireless wasn't "secure enough". Everything worked less well than it did before, from phones to the network.

From the customer perspective:

For the customers that don't care about whatever product you are integrating with, they haven't seen many new features because everyone is focused on integrations. There are now less people that understand the product focused on you.

For the customers that do care about the integrations, at least in my org, the integrations have been so shaky I can't help but think there will be some buyers remorse. And again the quality of people supporting you is now lower.

acdha• 13 years ago

That matches my experience working for a fair-sized customer: our high six figure annual support got access to an everything-is-broken portal, out of date documentation and very responsive support people who would quickly tell you something is fixed in the next paid upgrade or cannot be reproduced / is probably your fault. When IE8 was released and incompatible with a major app, I called and was told they had no plans yet for a patch – and the next week I received a call from a support manager asking if they could distribute my monkey patch to other customers…

I'm skeptical Amazon has anything to worry about.

Patryk• 13 years ago

It's intriguing how often HP's public cloud offerings are omitted from the conversation. I would think there would be a lot of interest especially because they're a heavyweight yet are using open standards (i.e., OpenStack).

No disclaimer: I don't work for HP (but I have used hpcloud)

rb2k_• 13 years ago

The main problem that I see with this:

- most people dislike Oracle

- most people like Amazon

So I think at least initially, it will be about "approachability" rather than price and technical equivalency.

Everyone programmer can usually spin up an ec2 instance after about 10 minutes. With Oracle, I have the feeling that just registering to see documentation will probably be more than 10 minutes and you'd end up in a database somewhere to receive emails/phonecalls a few weeks later.

possibilistic• 13 years ago

I agree with your sentiment. I would have trouble putting trust in Oracle.

But regardless of my feelings, only the people making the decisions on where to spend the money matter. Oracle has made it their business to be very good at converting those people.

Iftheshoefits• 13 years ago

Oracle has its tentacles deeply embedded in the enterprise space, especially in certain very niche and demanding markets (e.g. healthchare). They're "disliked" in the same way Microsoft is in these spaces, and "dying" in much the same way (i.e. not any time soon).

rch• 13 years ago

Remember when Ellison said he was just going to outcompete Salesforce (mid-2000s)? Interesting how that worked out:

http://www.salesforce.com/company/oracle.jsp

ashayh• 13 years ago

From my anecdotal experience, the majority of companies and projects using oracle products, do not actually need them, and could easily get by on free databases.

Oracle to Amazon: It’s on

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