Oracle's Hurd holds court: A read between the lines

Oracle is moving fairly aggressively to outline its strategy at its Open World powwow in a move that represents a shift from previous years.

In a nutshell, Oracle is touting its red stack of hardware and software, which is nothing new, but also noting its innovation chops as well as research and development spending. That positioning is the foundation for Oracle's cloud and big data pitches.

To reiterate this strategy, Oracle president Mark Hurd held a relatively rare press conference.

Also: Oracle's Hurd outlines 'holistic' strategy: Will CIOs bite?

Here's what Hurd had to say and my read on his comments:

• The linchpin of Oracle's cloud strategy revolves around private cloud architecture and allowing you to change your mind, said Hurd. If a customer has security concerns, run Oracle's cloud architecture behind the firewall. "You can mix and match clouds," said Hurd.

My take: Oracle argues that its mixed cloud approach with standard configurations is a big deal. It is for the enterprise customer. The reality is corporations will have public, private and on-premise applications. If Oracle can make toggling between those delivery models seamlessly it will have a strong business tech case.

• Core building blocks---applications and database---for engineered systems are strong and that plays into Exa- lineup returns.

My take:Hurd has a case here too based on performance gains and Oracle workloads. The looming concern with integrated systems will be lock-in and whether you want Oracle's hardware when you spend a ton on its software.

• Hurd, who oversaw HP's R&D spending slide during his tenure there, spent a lot of time talking about Oracle's healthy R&D spending. "More R&D spend doesn't necessarily mean more innovation. If you look at the yield out of R&D here you see incredible yield," said Hurd.

My take: Oracle has a nice R&D case with acquisitions as a supplement.

• Hurd is making storage case for Oracle and big data via in-memory and compression. Big data means exploding storage costs with unstructured and structured data. "10s if not 100s of millions of dollars are being spent to house this data," said Hurd. In other words, Oracle will be touting its compression algorithms. Hurd distanced its compression talk from technologies like de-duplication.

My take: The reality of big data is that the data scientists will want to keep everything. These people are information pack rats. The issue is that IT departments have storage costs. Welcome to the big data tug of war. If Hurd's argument that Oracle can rewrite storage economics sticks there will be interesting opportunities ahead.

• "Salesforce is a big customer of ours and a competitor. We're going to use our parts at the app layer to differentiate," said Hurd, who noted Oracle is the backbone of cloud providers.

My take: Oracle is using those cloud customer references to show it has the chops to architect its own service.

• Oracle is targeting emerging markets and Brazil, Russia, India and China, said Hurd. Europe is also being targeted. "BRIC countries are key areas of growth for us," said Hurd. "We're invested heavily in those markets." Oracle will also launch Open World China. "It's a bigger ecosystem when you look around the world," said Hurd.

My take: Watch this BRIC talk closely going forward. BRIC growth has slowed for numerous tech companies and it's going to be interesting to see whether the investment continues when growth slows.

• Will people buy Oracle's hardware stack and how will partners be affected? Hurd said much of Oracle's hardware is based on Intel and it will continue to build on best components. "Part of the market will buy best of breed. We've got to be best at every part of the stack. We're going to compete and win. There's going to be a market for that," said Hurd.

My take: Oracle will have to have the best hardware and integrated system stack because customers could be worried about lock-in.

• Hurd said the business benefits are the key to performance gains in integrated systems because the overall data center becomes more efficient.

My take: Oracle has spent too much time talking 100x performance gains, but managers need to know the returns. This messaging switch may reflect that the Exa- line of products need more quantification to drive sales growth.

• Hurd distanced Oracle from cloud competition. "Salesforce does one process: It focuses on sales automation, that's what they do," said Hurd. "We've announced a full suite." Hurd's argument is that companies won't cobble together 100 SaaS and cloud providers because governance will be too difficult and closing a quarter will hurt.

My take: The cloud suite vs. the SaaS army is the key argument. Right now, customers could be wary of a cloud suite with Oracle. Time will tell if reality and enterprise headaches change that equation.

More from Open World:

• Ellison sets sights on an all-Oracle cloud
• Oracle debuts MySQL 5.6 RC at inaugural MySQL Connect
• Ellison keynote at OOW: it's about speed and cost
• Oracle expands cloud services; unveils world's 'first' multi-tenant database
• Oracle unveils public cloud partner programs
• Does hardware matter in the cloud? Oracle is hoping so