Can Oracle become a public cloud power?
Back in 2008 Larry Ellison, CEO and God-King of Oracle was in fine form. When asked about cloud computing, he ranted, "The interesting thing about cloud computing is that we've redefined cloud computing to include everything that we already do. I can't think of anything that isn't cloud computing with all of these announcements. The computer industry is the only industry that is more fashion-driven than women's fashion. Maybe I'm an idiot, but I have no idea what anyone is talking about. What is it? It's complete gibberish. It's insane. When is this idiocy going to stop?"
Larry, Larry, some of what Oracle was doing in 2008 was cloud computing, but not much of it. And, behind all the cloud hype, there's real technology, which is far more than just a bunch of servers hanging off the Internet.
Of course, he figured it out eventually. By 2012, Ellison was claiming that not only was Oracle a cloud power, but it offered more Software-as-a-Service (SaaS) applications than any other vendor. "We're the only cloud application company that gives you a choice of deployment."
Oracle? Choice?
O.K. Whatever.
More recently, Oracle decided to venture beyond its business-to-business market and become a public cloud provider.
In 2015, Oracle Public Cloud, was taking dead aim at Amazon Web Services with Elastic Compute and Dedicated Compute infrastructure options for running workloads with both Linux and Windows support. And, the top of the list for all CFOs, Ellison also said that Oracle cloud prices will never be higher than AWS's prices.
It all sounds good, if you trust Oracle.
Personally, I've never trusted the giant of databases.
Cloud
In the case of the cloud, Oracle has claimed that it made $1.5 billion in 2015 from it. Dan Woods, CTO and Editor of CITO Research, using data from Craig Gurante, CEO of Palisade Compliance and an Oracle licensing expert, claims Oracle's cloud revenue numbers are bogus.
Specifically Woods claims that Oracle uses mechanisms such as "cloud credits" to move client revenue from traditional Oracle services to cloud computing without really achieving adoption. I think he's right.
Besides, I see Oracle as being much too late to the public cloud game to make a race of it. AWS, Google, IBM, and Microsoft are all well ahead of them.
Oracle's business plan has been to profit from software licensing. Specifically, Oracle licenses its programs on top of on-premises servers inside the corporate data center. Yes, they've used SaaS models and way back in 1995 Ellison tried to turn back the PC revolution with the network computer. This was a compromise between the terminals of mainframe and mid-range computers and what we'd now describe as Desktop-as-a-Service (DaaS). At day's end that's not where Oracle makes it money.
After all, even if you do buy Oracle's $1.5 billion of cloud revenue, that's still only 4 percent of Oracle's $38 billion in revenue.
Will Oracle eventually become a cloud power? Sure. As any business which has tied its IT fate to Oracle knows, once you're in, it's almost impossible to get out. But, as a public cloud power? No, I don't see it happening.
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