Oracle says its cloud is now complete, though its decision to compete at every layer of the cloud stack has left...
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some IT industry watchers scratching their heads.
The tech giant rolled out a collection of 24 new infrastructure as a service (IaaS) and platform as a service (PaaS) offerings this week. New features include the extension of the Exadata database platform to the cloud, cold storage, big data services for SQL, NoSQL and Hadoop, lifecycle management, mobile back-end as a service and tools for integrating on-premises and cloud workloads.
The overall additions to the Oracle Cloud Platform are positive steps, especially when put in the context of pretty bad four quarter earnings that saw significant drops in licensing revenue, said Robert Mahowald, program vice president for cloud services at IDC , in Framingham, Mass.
The IaaS offering will likely be a loss leader for Oracle while it figures out how to operationalize and compete against Amazon Web Services (AWS), Mahowald said. So while the infrastructure is important as a launching pad, it's the application portfolio and PaaS offering that will make the difference.
"They're trying to get more of the gravity on their platform and at the end of the day they will probably be successful at it," Mahowald said.
The assets are lined up, so now it's a matter of executing on that strategy, he said.
"People have some legitimate concerns about it being a bit of an octopus strategy and about an all-Oracle world when they see Amazon as more neutral, but they have enough big assets and enough resources to be compelling," Mahowald said.
Oracle Cloud takes AWS head on
Many cloud vendors have shied away from publicly grappling with AWS, but Larry Ellison, Oracle's CTO and executive chairman of the board, didn't hesitate to go directly at the public cloud giant.
He repeatedly contrasted Oracle and AWS and said Oracle will compete on price in areas it perceives as commodity services. One such area was storage, where the new Archive Storage will be priced 10 times cheaper than Amazon’s Glacier service at $0.001 per gigabyte per month, Ellison said.
Oracle has the most software as a service offerings and is now filling out its portfolio with IaaS and PaaS products so customers can easily move between on-premises and the Oracle cloud, whether it's with its existing services or third-party applications, Ellison said.
"We're now prepared to call our cloud complete," Ellison said.
Oracle is capable of accomplishing big things when it prioritizes them, but there are plenty of reasons to be skeptical about how well it will pivot away from its software licensing model, said Carl Brooks, an analyst with 451 Research, LLC, in New York.
"They're four years late to the party," Brooks said. "It's pretty ridiculous how they have stubbornly kept their head in the sand on this for years because they have a captive audience they treat however they feel like."
It's more of a rearguard action to protect its existing customer base from going elsewhere, but Oracle still hasn't shown it has enough additional value on top of its core product, which is rapidly losing value, Brooks said.
It's also disingenuous for Ellison to disparage Amazon because there's probably as many Oracle licenses on AWS as there are anywhere else these days, Brooks said. Even Microsoft, which is perceived as the biggest competitor to AWS, is complimentary of what Amazon is doing, so the "us versus them" mindset of winners and losers isn't applicable in the current market.
"The question is not whether or not they can compete in cloud – of course they can if they put resources toward it," Brooks said. "The question is are they too late and how small is Oracle going to be before it has reoriented into this new avenue and how much is it going to matter in the end."
This is Oracle's "all-in cloud moment," and it's reminiscent of Steve Ballmer proclamation at Microsoft in 2010, said John Rymer, vice president and principal analyst at Forrester Research, Inc., in Cambridge, Mass. So while it's a long time coming, it's better late than never.
"At this stage they've got a good collection of services for what they need to do," Rymer said. "They need things to help their existing application customers take advantage of the cloud and the services they announced are well suited to that challenge."
And while it appears useful for existing customers, it's still very young and will require hardening and maturing before any final judgment can be made about Oracle's cloud services, Rymer said. Still, Oracle's insistence on stacking itself up against Amazon doesn't make sense.
"I am mystified about why he says that," Rymer said. "I don't understand why he feels it's so important to compete with Amazon in particular."
"Infrastructure services, that's a race to the bottom. They're going to make their money the way everybody else is going to make their money, with higher value services."
Trevor Jones is news writer for TechTarget. Contact him at firstname.lastname@example.org.