"Oracle" Learns to Love "cloud"

The answer to this question depends on the definition of the cloud. If there is a so-called standard answer, cloud computing is not a product that must be installed and maintained, but a service that can be used as a common facility. Like turning on a tap or turning on a light, the cloud lets people watch movies on Netflix rather than go out and buy a DVD; Let people dropbox share files through online file storage services instead of emailing Microsoft Office files back and forth.

By this definition, Oracle has not been a cloud company so far. The company fiscal 36 billion dollars a year, but most of the revenue comes from products that help businesses and government agencies operate online: hardware, middleware, storage systems, and applications. But these are the products that Oracle sells. Unlike the online customer relationship management service provider Salesforce and the information integration solutions provider NetSuite These are like public facilities for customer database processing, Oracle is never a public service provider.

Oracle is not an opportunity to enter the cloud. Salesforce and NetSuite were created separately by Oracle's former employees, Ellison's former Benioff and Evan Goldberg. Mr. Ellison, even one of the two companies ' early investors, has been given the opportunity to take the lead in the two cloud computing industries. But Oracle ignores the cloud and continues to stick to its core business: selling and supporting the infrastructure that allows businesses to operate online.

A few years later, the situation has become clear: cloud computing as a service is not just a fad but a reliable business. But at the Open World Congress 3 years ago (OpenWorld, Oracle's annual client talk), Ellison ridiculed cloud computing: "The computer industry is the only industry that is more likely to be driven by fashion than female fashion." Maybe I'm an idiot, but I really don't understand what these guys are talking about. What is this stuff? It's all nonsense, crazy words. What's the point of this madness?

To be fair to Mr. Ellison. The term "cloud computing" has been so frequently hyped in so many different contexts that it does seem like a short-lived fashion trend. But in fact, like women's fashions, the Cloud is a thriving business. Oracle's share price has risen 96% per cent since Mr. Ellison's comments on cloud computing, much better than the 39% increase in the standard and Poole 500 index. By contrast, NetSuite's share price soared in the same period, 354%,salesforce's share price soared 389%.

It took some time, but Oracle's public comments on cloud computing have finally been much milder. Last March, when Oracle announced its quarterly earnings, Mr. Ellison claimed that the good performance of the last quarter had been partly the result of a year-long contract signed with Salesforce, and that most of Salesforce's highly acclaimed cloud services relied on Oracle's hardware, Databases and middleware. "Oracle is a technology that gives power to the cloud," Ellison boasted at the time.

This is a good thing for Oracle. The drawback is that when people celebrate cloud computing as a popular business area, the people who receive congratulations are Salesforce, not Oracle. Salesforce, for example, is a star designer Vera who shines on the cover of a magazine. Oracle was just a coolie who stitched her fashion designs together in a sultry factory.

The situation itself is bad enough, but even more humiliating for Oracle, Salesforce CEO Benioff began repeating this unpleasant fact in his speech. Take Benioff June keynote speech. The speech content is very rich Benioff characteristic: the swagger, the charm is full, but is enough. He talked about the "false cloud", and the display behind it was a exadata machine, with the Oracle logo barely covered by a cloud. Benioff said:

"If you emphasize hardware, it's not a cloud. If the vendor sells you more hardware, software, and tells you that this is a private cloud, please don't take it seriously. If it still only faces the elite, it is not a cloud. We are engaged in a public cloud movement, and nothing can stop this movement. I traveled around the world, and I tried to get people to know that they should be wary of this false cloud. ”

Benioff faithfully adheres to the standard definition of the cloud. The irony of his remark is Oracle. After acquiring Sun, Oracle's profits were dragged down by low-margin hardware such as Sun's x86 server. "Private Cloud" is a term privatecloud by Oracle to convince its customers that they are building their own cloud. But in the end, Oracle responded quietly: Mr. Ellison removed Benioff's name from the Oracle's opening World Conference speaker list this year.

Instead, Ellison published a keynote speech that many people seem to be rambling about. "Oracle's cloud is a bit different," says Ellison, who seems to be adding a "nonsense" to his conversation about cloud computing. Last week, Oracle again changed its stance on cloud computing, demonstrating its willingness to enter the field by way of acquisitions – Oracle spent 1.5 billion of billions of dollars to buy Salesforce's rival, RightNow, in cloud computing.

Maybe Ellison just wants Benioff to shut up. Or, despite his intense rhetoric, Ellison realizes that Oracle's future is not just about providing the hardware and software to help the cloud, it needs to provide such services.

At Oracle's recent shareholder meeting, a private investor asked Ellison why IBM's stock performance was superior to Oracle's. "Well, IBM is a great company," says Ellison. Our strategy is very different. IBM is indeed transforming from a technology company to a service company. ”

This is tantamount to a tacit acknowledgement that Oracle needs to emulate IBM and transform itself into a service company in the cloud era. The essence of the cloud economy is service. Oracle needs to act not just as a conduit to the system. It also needs to be the source of the system.

Can Oracle have both? Before it thought design cloud technology is enough, so far, Oracle's big gamble has been very fruitful. The problem is that business is tired of technology, or rather, of the pace of technological upgrading. They just want to be on the upstream side of the system, and only need a trusted, cloud-based public facility. As a result, Oracle's innovations in "cloud-powered" technology have only made Salesforce a more powerful service company.

Looking back, Mr. Ellison rightly thinks cloud industry is a fashion industry. When plumbers may not be fashionable, cloud computing is indeed fashionable.

(Responsible editor: Songtao)