Oracle's invisible elephant

Oracle's invisible elephant

Summary: From Oracle OpenWorld: nothing but good news - and a missing elephant, or maybe two.

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The two big positives coming out of Oracle's OpenWorld conference in San Francisco this week were both follow throughs on earlier commitments: on the structure, completeness, and roll-out of the Fusion applications environment, and on the integration of hardware and software through engineered solutions (i.e. computing appliances) in everything from single slot Xeons for foggy thinkers to the eight rack T3 tornado climax cloud - and, no that name's not gibberish, it's Oracle's Exalent venture in market mocking wording.

More good news was hidden among the hype: Victoria Falls servers now, Solaris 11 in preview, Red Hat sidelined, stronger competitive positioning vis-a-vis both HP and IBM, new emphasis on operational simplicity and reliability (e.g. bringing networking and storage back into the box), and the working out of the Fujitsu relationship.

More subtly, I think there were back channel hints about yet another license simplification effort and, more importantly, clear indications that at least a few marketing people have figured out the obvious: IT may argue about price and throughput but users really only care about system response - so the T3's whomping of both x86 and Power7 on throughput and cost is much less important in the appliance market than its advantages in providing consistent sub-second response for application users.

To the extent that there was bad news it came from the Java people - where direction setting seems almost as confused as the environment itself, and not a single Oracle employee came anywhere close to admitting that the decision to use Java for the Fusion apps made sense before Oracle bought Sun, but doesn't now.

And of course there was lots of interesting minutiae, most of it positive - but some of it also amounting to a depressing commentary on the inadequacies of Sun's marketing people in the face of concerted media attacks. Some of Oracle's sales people have discovered, for example, that the cryptology processors embedded in CMT make sense and should be mentioned to customers - as in duh! and only four years late.

So what elephant in the room didn't get named? Growth: Ellison has said Oracle should grow, over the next five years, into something roughly IBM's size in revenue terms, but while the entire conference was about this, nobody spoke directly to the challenges involved in quadrupling revenues for an already large company.

At the grossest level the answer is, of course, obvious: they plan to sell the existing customer base whatever that base wants while betting the company on growing their applications market through appliance computing - thus the new OLTP appliances support SQLnet, a kludge embarked on when Microsoft omitted TCP/IP in Windows 3.

Most analysts answer the growth question by assuming failure: by assuming, that is, that management can't grow the company enough internally and will therefore have to make a couple of Sun sized or larger acquisitions. I think that's pessimistic: the growth opportunities in appliance computing are enormous and while it might make sense to grab a few good people or high potential technologies (like an advanced, non Intel, handheld) through acquisitions, buying into dying businesses like SAN storage or Global IT Services is a game for losers.

(One caveat: if Hurd gets both halves of Novell, he'll give Ellison the opportunity to go after IBM in the courts and the press - and that might be worth the money.)

Unfortunately the major sales challenge is the same one Sun faced: the absence of an adequate, customer side, fifth column - unlike Apple, Oracle doesn't sell directly to the end user and there are just aren't enough people with strong pro-Sun/Oracle prejudices in buying positions around the world to give Oracle the market growth it needs.

Basically the problem is that the mid size businesses that would benefit most from throwing out the Wintel/DP environments they have in favor of the appliance computing packages Oracle wants to sell, don't have enough people in place who know what these are, how they might work, or why their employers need them - on the contrary, the decision influencers in place generally have their careers tied to older and less effective technologies to the point that they'll willfully ignore more modern alternatives while lying to both themselves and their employers to protect the beliefs their jobs depend on.

This is the problem disruptive technologies always face - and, of course, dissonance theory predicts that commitment to failing technologies produces howling mobs desperate for disinformation; or, in this case, a market for the journolists working from the same talking points, quoting the same press releases, and spouting garbage like this:

Their appearance came as a surprise to many observers who did not expect the T3 processors and resultant systems to see the light of day following Oracle's takeover of Sun.

to denigrate everything Oracle at every opportunity.

Sun's marketing people tried appeasement, and failed - of course. So what would work? Obviously better marketing - and along those lines I have a suggestion for Ellison et al that might help: add a formal HR placement function to your certification processes, and deliver that service through an arms-length placement agency whose recruiters use appliance computing, can spell both lynnix and Solaris correctly, and at least split their sales effort between user management and IT.

The corporate goal would be to see this agency establish small franchisees in each major market and use them, in conjunction with existing local Oracle sales coverage and training programs, first to add work experience to certification, second to place evangelists in customer organizations, and third to provide a highly visible, Windows document focused, reference site for Sun Ray, Oracle Office, and appliance computing.

The bottom line on this idea is that implementation would be good for everyone - and not mainly because the placement business can be highly profitable, but mainly because it puts the right people with the right skills in the right places to drive the customer decisions shaping Oracle's growth.

Topics: Enterprise Software, Networking, Oracle

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31 comments
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  • RE: Oracle's invisible elephant

    Paul,
    Just a few months back you were pessimistic about the entire industry...
    http://www.zdnet.com/blog/murphy/depressing-jobs-advice/1841?tag=content;search-results-rivers
    LOL... So much for your July prognostication, hehe.

    While I agree with your optimism for the industry.. I can't fully agree with your growth projections. I do see Oracle making some growth, though, just not a quadrupling.

    Also, Sun and IBM are now the ones playing nice... I think that is a good play, now that IBM and Sun have come out with new high end models... HP is IMO the vulnerable one... in the shrinking high end(but profitable) market. I suspect that this next decade... HP will be the one having major problems.

    HP has sacrificed alot in the long term for short term profits over the last few years. Their R&D is barely more than Oracle's... (IBM's 3 year R&D is more than HPs and Oracle's combined over the last 3 years) and they have gutted their service units.
    scotth_z
    • Sorry Scot: no contradiction there

      @scotth_z <br><br>What I said in July was that the economy was getting worse and therefore that employment triage - dropping many people now in hopes of increasing the survival chances of the remainder- made sense then and seems even more sensible now. <br><br>Oracle's news is positive - for Unix, for manpower reduction, and for companies willing and able to move to newer, more productive, technologies.<br><br>Think of Pelosi et al as creating the problem and oracle as offering part of a survival strategy and you'll see that there's no contradiction here.<br><br>P.S. wish there was - that the depression were over. But it's not and won't be until the attack on America is first stopped and then reversed.
      murph_z
      • RE: Oracle's invisible elephant

        @murph_z Ah, you're a teapartier! I didn't realize. Well, that explains an awful lot.
        benw-sf
      • RE: Oracle's invisible elephant

        @murph_z

        Hah! In one breath you say that Oracle has a superior platform and product that suffers only from poor marketing, and now you suggest that HP slashing their R&D, and therefore directly resultant inability to produce a new offering makes sense as a business model?

        HP is facing ever increasing difficulty differentiating themselves in the market, and "Eh, it was cheap and there was a phone number to call." Is not a growth or maintenance strategy. It's a slow decline strategy.
        tkejlboom
      • I said what?

        @murph_z
        No I didn't.
        murph_z
      • RE: Oracle's invisible elephant

        @murph_z

        Yes, there is a contradiction, as is to be expected out of someone who endorses "voodoo economics" through the backdoor the way you do by blaming our woes on Pelosi.

        And oh, BTW: your journalism would be just as tad more credible if YOU could spell. Or if you can't do that, use a spell-checker. I can assume your spelling of 'linux' as 'lynnix' is just a failed joke, but you have no excuse for 'journolists'.

        Then again, such a low level of intellectual competence is about what I expect out of anyone who sees Pelosi as the cause of economic problems -- worse yet, Oracle as a solution. It should be painfully obvious, especially since the frivolous lawsuit against Google, that Oracle only offers a 'solution' for Larry Ellison.

        The "attack on America" is not coming from Pelosi -- nutty though she is. It is coming from those who endorse "voodoo economics" whether openly or through the backdoor.

        You don't have to take my word for it; take the word of economics Nobel Laureate Paul Krugman: the collapse was caused by regulation failing to keep up with "innovative financial instruments" (he means CDOs, credit swaps, derivatives...), has created a "liquidity trap", which can ONLY be cured by following the Keynesian prescription: restore the inducement to invest by raising the money supply by raising government spending.
        mejohnsn
      • journolist

        @murph_z
        Try google - it's not a mistake
        murph_z
  • RE: Oracle's invisible elephant

    Well we have to get rid of all you computer nerds

    Computer nerds are like the titantic when it comes to the economy
    X41
    • RE: Oracle's invisible elephant

      @X41

      Eventually, but the important thing is to steer clear of icebergs. In due time.
      Don't know if the new licensing model will allow the "nerds" (ask the people at c0t0d0s0.org about this) to test future deployments without the Damocle's sword of "personal use" hanging over their labs.
      Here I think Murphy is right when he says horrible things about channel reps and Oracle's Big Iron politics against SMB whishes.
      Ad maiora...
      rikkytikkytavi@...
  • Cisco is a great target

    Great reputation, good product, already in line with useful appliances.
    sparkle farkle
  • what Oracle needs a real channel

    Your comment that there "<I>aren't enough people with strong pro-Sun/Oracle prejudices in buying positions around the world to give Oracle the market growth it needs</I>" is exactly why Oracle needs to invest in developing a real reseller channel.<br><br>-johnj
    johnjmclaughlin
    • RE: Oracle's invisible elephant

      @johnjmclaughlin

      But you seem to have missed something even more important: it was an admission that the ONLY way Oracle can win is bytaking advantage of people's prejudices: they can't win in a truly open, fair competition.
      mejohnsn
  • COST is very important in SMB

    Oracle will struggle to sell its overpriced and punative license and maintenance models in SMB.

    The enterprise is also waking up to "a single throat to choke" being the worst kind of lock-in and ending up being cutting off your own air supply.
    hubivedder
  • Projection?

    "This is the problem disruptive technologies always face - and, of course, dissonance theory predicts that commitment to failing technologies produces howling mobs desperate for disinformation; or, in this case, a market for the journolists working from the same talking points, quoting the same press releases, and spouting garbage like this:

    Their appearance came as a surprise to many observers who did not expect the T3 processors and resultant systems to see the light of day following Oracle?s takeover of Sun.

    to denigrate everything Oracle at every opportunity."

    Never heard of dissonance theory, but I presume you mean cognitive dissonance which occurs when contradictory ideas are held or observed and people try to reduce this dissonance. They can do this by changing attitiudes or beliefs or by by justifying, blaming, and denying. First, it's only a theory and if you are going for that, you might as well include projection where you deny your own behaviour by imagining or projecting that others are guilty of it.

    Come on Rudy, doesn't denigrate something at every opportunity sound familiar?
    tonymcs@...
    • Yes, I thought the same thing. Murph denigrates Wintel at every opportunity

      @tonymcs@... And if there is not an opportunity. He creates one.
      MeMyselfAndI_z
  • Be nice if there were some independent benchmarks.

    Murph, most of the benchmarks you link to are Sun/Oracle. When I research independent benchmarks (none for T3 yet) I get a much different slant on performance. Seems that their benchmarks are oriented to make their products shine.
    I have no doubt that T3 is a great processor for highly threaded server apps.
    MeMyselfAndI_z
    • benchmarks

      @MeMyselfAndI_z

      Agreed - however the ones on the cmt/benchmark page are generally public and there are comparisons to other runs done by other people on other gear. These are reasonably trustworthy because the people in charge for each test wanted their test gear to win.

      A big gottcha with "independent" benchmarks is that few are. Many have, for example, well established track records of hiring the best and the brightest adherents of one side to run both sides of an "objective" comparison - thus slanting all results to the side they favor.
      murph_z
  • aren?t enough people with strong pro-Sun/Oracle prejudices

    Hmmmm. Now that is an interesting statement. Personally I do not want anyone working for me that has a pro-anything prejudice. Prejudice comes from pre-judging which is to say making decisions based on one's own biases rather than from logic. I really do not think any organization can afford to have those making purchasing decisions based on prejudice of any kind whether it be for sun/oracle or against or for or against any other company. I want them making decisions based on what seems to be the best fit for our organization, its needs and its budget.
    cornpie
    • never happens

      @cornpie

      So I've decided to be more honest: prejudice (in this kind of situation at least) = (is the result of) experience + analysis; not self-interest. Bias, in other words, can be either dishonest (self-interested) or honest (application of experience) and I'm opting here for the honest kind.
      murph_z
    • RE: Oracle's invisible elephant

      @cornpie

      I am glad to see that I am not the only one to notice this. Then again, do you really believe that it ever happens this way? In 25 years of working in the industry, I have never seen a purchasing department that ever "made decisions based on what seems to be the best fit". On the contrary: the salesmen from the competing vendors were very skill ful at exploiting their prejudices, prejudices their victims were not even aware that they had.

      Of course, salesmen are trained in B-school to believe that deep down, we are all like that: nobody really makes rational decisions, we make them based on our prejudices, and then rationalize them after the fact. You can even find New York Times articles making this same argument.

      Not that I endorse this view: but I do believe that lots of people, especially in the various IT and engineering professions, believe they are much more rational than they really are.
      mejohnsn