Is Salesforce building on Oracle's next-gen database?

Oracle CEO Larry Ellison previewed cloud partnerships with companies like Salesforce and his company's 12c database, which will be multi-tenant. Is that what Salesforce included in a nine-figure Oracle contract?

Salesforce has reportedly signed up for a pricey Oracle database deal and JMP Securities analyst Patrick Walravens thinks a total contract value may approach $300 million over five to seven years. That deal would include database, middleware and back-end technologies.

There has been a fair amount of hubbub about whether Salesforce would ultimately get off of Oracle's database infrastructure. Strategically, a move away from Oracle would make sense. The data points, however, may be stacking up to indicate that Salesforce and Oracle may just be the enterprise version of Amazon and Netflix. Amazon and Netflix compete, but the latter runs on Amazon Web Services. Could a similar situation emerge with Salesforce and Oracle?



Oracle CEO Larry Ellison on Thursday previewed his company's 12c database, which will be multi-tenant. Meanwhile, Oracle noted that there will be cloud partnerships with Salesforce, NetSuite and Microsoft announced. If you connect the dots, it sure sounds like Salesforce will build on Oracle's latest database.

Here's Ellison:

The 12c is the multi-tenant database. 12c stands for the cloud. It's the first time a database confers multi-tenancy to the applications that run on the database. As you know, the cloud business started about 15 years ago with a little company called NetSuite. And then there came Salesforce and many others. And what they had to do was build multi-tenancy into the application. If they wanted to run a lot of customers' data on a small number of servers, and do that economically, they had to build the multi-tenant capability directly into their applications, which had certain problems. It has security problems. That means your standard report writers won't work. A lot of standard tools just won't work because of this multi-tenancy application architecture. The next phase of multi-tenancy was virtual. IBMs became a very popular way of sharing hardware, sharing servers. But unfortunately, that has significant overhead. Much more overhead than is  going to be the NetSuite, way of doing it in application.

We think the right way to confer multi-tenancy on applications and keep security working and use the hardware very efficiently is to put multi-tenancy at the database layer. And that's what we've done with 12c. It is a separately priced option. Next week we will be announcing technology partnerships with the most important — let me be clear — the most largest and most important SaaS companies and infrastructure companies in the cloud. And they will be using our technology, committing to our technology for years to come.

That's how important we [see] 12c. We think 12c will be the foundation of a modern cloud where you get multi-tenant applications with a high degree of security and a high degree of efficiency, where you don't have to sacrifice one for the other. Again, we have — again, I would call them startling series of —  announcements with companies like, NetSuite, Microsoft. All that happens next week, we will be giving you the details. These partnerships in the cloud I think will reshape the cloud and reshape the perception of Oracle technology in the cloud. 12c, in other words, is the most important technology we ever developed for this new generation of cloud computing.

If you couple Ellison's 12c comments with some plugs for Salesforce CEO Marc Benioff, who has done a "good job" to grow a "market leader," the dots seem to connect. Amazing what a nine-figure contract can do for the rhetoric between Oracle and Salesforce.