Ellison pushes Oracle's new cloud platform, but questions linger

'We're just getting started' in the cloud, he says

Larry Ellison cloud demo
Chris Kanaracus/IDG News Service

Oracle Chairman Larry Ellison has delivered another dose of hype for the vendor's cloud platform, but many customers may need more convincing before they make the leap.

In many ways, Ellison's talk at the OpenWorld conference on Tuesday was a rehash of a keynote he delivered on Sunday, although he dug deeper into the technical weeds and even conducted a number of live demonstrations of what he called a "brand-new, majorly upgraded" platform.

"We wanted to make it very easy to move existing Oracle databases and existing Oracle applications to the cloud," Ellison said. However, "there had to be a bunch of benefits associated with that. We wanted to be able to move [them], modernize [them], and lower your costs."

Ellison, who recently stepped down as CEO to become executive chairman and CTO, has said repeatedly that customers will be able to move databases and apps to Oracle's cloud "with the push of a button."

On Tuesday, Ellison walked through a few examples that actually required more than a single button press, but not too many. Ellison also had to log into Oracle's cloud service, which gave him an opportunity to deliver a trademark quip.

"I'm logging in as John Smith," he said. "They took away my name. It's been a rough few weeks."

Oracle's Enterprise Manager tool is involved on the back end, but it wasn't clear from Ellison's talk how involved it is to perform the initial setup between a customer's systems and Oracle's cloud.

First, Ellison moved a 12c database containing reams of Wikipedia search data from an on-premises server to Oracle's cloud.

Ellison displayed the Oracle cloud management console as proof to the audience that the database had made the journey successfully.

Next, he quickly moved a Java application to the Oracle cloud and launched it within a minute or so.

"Voila," a smiling Ellison said. "Looks like the same thing."

Finally, Ellison demonstrated an extension for Oracle's HCM (human capital management) application that was built on its cloud.

Customers will save money running their software on Oracle's cloud rather than their own data centers because it's more efficient, according to Ellison. Oracle is committed to matching the likes of Amazon Web Services on pricing for underlying IaaS (infrastructure as a service), Ellison has said.

The level of automation in Oracle's cloud is another benefit, he said. "The human element is removed," he said. "It's faster, cheaper, more reliable and there's no human error."

That said, Oracle's cloud will "gracefully co-exist with your data center," Ellison said. "It all looks like one collection of computers."

Ellison expects that over time, thousands of ISVs, hundreds of thousands of customers, millions of databases and applications will end up on Oracle's cloud. "We're just getting started," he said in concluding.

Oracle wants to present itself as a one-stop-shop for all things cloud, given it offers SaaS (software as a service), PaaS (platform as a service) and infrastructure.

Ellison's talk left a few important questions unanswered for customers considering such an arrangement, such as whether they will gain savings at all three layers compared to running systems on-premises.

Given the ongoing price war in the IaaS market, Oracle may be assuming it can make little or no profit on the IaaS layer, but generate big money on cloud applications and PaaS.

During a press conference Monday, Oracle CEO Mark Hurd declined to comment on the notion but said he expected most customers who buy its PaaS or SaaS would naturally also choose its infrastructure service.

Overall, Oracle and Ellison have more work to do before customers broadly but into the one-stop-shop approach.

"The three pillars, that for me is what's resonated the most and piqued the most interest [at OpenWorld]," said Alyssa Johnson, president of the Oracle Applications Users Group, in an interview. However, "for me, it's not about 'tomorrow let's go do that,' it's about 'tell me more,'" she added.

OAUG represents many users of software such as Oracle's E-Business Suite, which is predominantly run on-premises. There's a place for Oracle's new SaaS applications in their environments, Johnson said. "Their practical path to cloud is to take advantage of those edge apps," she said, citing one Oracle created for revenue management. "The E-Business Suite management team is not going to duplicate that effort."

Dunnhumby, a UK company that helps retailers create customer personalization programs by analyzing massive amounts of information, is a big user of Oracle's Exadata data-processing machine and recently started work on moving its back-office software to a suite of Oracle cloud applications.

That said, "we are absolutely not committed to being a single vendor organization," CIO Yael Cosset said in an interview. "We're not married."

However, "it's a very strong and successful partnership," Cosset added. Oracle has been willing to work with Dunnhumby on "new things we're thinking of doing two or three years out," he said. "You can't put a price on that."

Copyright © 2014 IDG Communications, Inc.

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