All About the Cloud

it's all about the Cloud - just ask Larry Ellison

October 03, 2012

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Oracle, the world's biggest enterprise software company, just finished its annual OpenWorld conference in sunny San Francisco, and if there's one message you hear loud and clear its this:  Oracle Gets the Cloud.

And not only has the company transformed nearly everything it sells to the cloud (from Exadata servers to Database on-demand), Larry Ellison eloquently describes the cloud as a "utility." Just like we expect the phone and electric company to invest in capital and then charge us for per-usage services, so Oracle is reinventing itself in the same way.

Oracle is a big company, so this is not a small transformation - but it is taking place quickly, and you will see Oracle put its cloud offerings first in nearly every market.

Fusion

The name Fusion is still a bit odd, but it continues to be Oracle's strategic new set of cloud-based applications.  The conference was jammed as usual, and I had the opportunity to meet with four new Oracle Fusion HCM customers and sit through several Fusion HCM sessions.

Our reaction as an analyst is that Fusion is real, and more and more customers are looking at it by day. Is Oracle as "cloud-based" as Workday (IPO next week) and Salesforce?  Not yet - but Larry easily dismisses these companies as "niche players."  Oracle, after all, sells business software for every possible application - from financials to project management to HR to manufacturing - and the Fusion product line crosses all application segments.

Databases are Alive and Well

And thanks to the huge demand for analytics and BigData services, Databases are alive and well.  

As I stood in the analyst area awaiting a meeting, I overheard a poor DBA yelling into his phone "You mean the backup failed? Well you have to recover it and start again!  If we can't get it working I'll get on a plane and come home."

Well if you've ever worked with relational databases you know they're quite complex and often slow. Oracle has now "engineered" the database into the Sun hardware (Exadata X3) and this week launched an in-memory database which is 10-100X faster (i've heard this story for years) and a new version of the database (Oracle 12c - c="cloud") which lets organizations create pluggable databases which can be backed up in clusters, to serve the needs of SaaS application providers.

Not everything Oracle announces is always "quite ready" yet, but the thinking and direction is crystal clear and well conceived. This is a company that is rapidly reinventing itself for cloud computing.

What about the Workday IPO

In our market the Workday IPO is coming soon, so there will be a lot of buzz about Workday's "new architecture" ERP and HRMS in the market. A lot of PeopleSoft customers are now comparing Workday to Fusion (we are in the middle of several such projects right now), so the clarity of Oracle's message is particularly important.

While some companies will definitely chose Workday because it is "new," Oracle can definitely say the Fusion HCM is "new and improved" also. One major bank I talked with told me they decided on Oracle's strategy because they had such a huge business relationship with the company and they can afford to bet on Oracle's long term strategy. Plus Oracle has an entire suite of applications, while Workday focuses primarily on HRMS.

But lots of other companies (often those which have gotten poor service from Oracle) and many who are new to the HRMS market will choose Workday, and our friends at a large integrator told me they're flush with business doing Workday implementations.

We are entering a hot season of news and information in HR Technology.  Next week is the annual HR Technology Conference and we will be launching our groundbreaking research on the learning management system and talent management systems market.

As far as Oracle goes, I give the company a huge amount of credit for reinventing itself from top to bottom - this is a big company that manages to stay relevant and central to technology decisions in nearly every corporate application market.