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Oracle cloud strategy: Is it time for a reality check?

OpenWorld again placed the Oracle cloud strategy at center stage, as one executive after another argued the case for Oracle being a leading vendor of cloud software.

Asserting that the industry is in the middle of a generational shift comparable to the move from minicomputers and mainframes to personal computers, CTO Larry Ellison outlined the history of the Oracle cloud strategy, painting the vendor as painstakingly laying the foundation with a cloud software stack that has allowed it to emerge as the No. 1 purveyor of software as a service (SaaS).

"The cloud business is not that large, but it’s been going on now for over 15 years," Ellison said. "It's been 10 years since Oracle realized that we’re going to have to rewrite virtually all of our applications and make them run on the cloud as a service."

"We started the Fusion project about a decade ago," he added, referring to the application and middleware platform that has come to market in fits and starts. "It was a huge amount of work."

Keeping his focus on the cloud, particularly SaaS, Ellison compared the Oracle cloud strategy favorably against those of SaaS ERP pioneers NetSuite and Workday, and took a swipe at archrival SAP.

"The largest application company in the world is still SAP, but we never see them in the cloud," he said. 

In this video, recorded at the annual user conference held recently in San Francisco, David Essex, executive editor of SearchFinancialApplications and SearchSAP, chatted with Brian McKenna about the Oracle cloud strategy. McKenna is the business applications editor of ComputerWeekly.com, TechTarget’s London-based website for daily IT news and analysis.

"It's interesting, this whole cloud narrative that Larry was talking about," McKenna said. "He was saying that they started to re-architect, rewrite that code, all their applications for the cloud -- and always had that in mind. And I wonder ... whether it's a kind of retrospective imposition of a narrative upon the way things have gone."

McKenna suggested Ellison's need to present the Oracle cloud strategy in the best light is partly driven by the pressure Wall Street and London financiers put on Oracle and SAP to show growth in their cloud businesses.

As for the dismissive tone toward SAP, McKenna pointed to SAP's SaaS HR platform. "SuccessFactors is clearly an important element of SAP’s business," he said. "It can't just be dismissed as something that runs on Oracle." 

McKenna also questioned claims that Oracle Exadata in-memory technology outperforms SAP HANA.

The keynote speakers' positive spin on hybrid cloud and on-premises systems was also discussed. “They may be making a virtue out of necessity there,” McKenna said.

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Oracle OpenWorld 2015 roundup: Oracle cloud news and more

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What are the pluses and minuses of the Oracle cloud strategy?
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Oracle has a strong play in SaaS for Oracle business applications. It will be very interesting to see how well their PaaS offering gets adopted by ISVs and SIs to extend customizations for SaaS services, to match the customizations that have been done to on-premises Oracle applications.


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