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Big Red’s geographic breadth and support for data sovereignty make it a contender against prominent players, AWS, Azure and Google
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The Crimson Cloud Conglomerate’s partnership with Microsoft to run Oracle Autonomous Database on Microsoft Azure is a big part of Oracle’s enterprise appeal
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This week, the Scarlet Software Syndicate extended that partnership to five new global regions, bringing the total to 15
There’s a new top-tier hyperscaler cloud platform, a tiny startup you probably haven’t heard of: Oracle.
Oracle has struggled to get taken seriously as a cloud provider. The 47-year-old company was known for stodginess and being tied to its on-premises legacy database. However, it’s been steadily building its global data center infrastructure and cloud platform and embracing a multi-cloud strategy. Over the past year or so, that work has been getting noticed.
Is Oracle now a big-league hyperscaler cloud, no longer the little brother panting and scurrying its tiny little legs to keep up with Amazon Web Services, Microsoft Azure and Google Cloud Platform?*
I asked Futurum Group analyst Ron Westfall, and he didn’t equivocate: “Yes,” he said flat-out.
Oracle has geographical breadth and a large number of data centers to fulfill organizations’ worldwide needs, Westfall said. It can address organizations’ requirements for sovereign cloud, where nations require citizens’ data to stay in-country. Oracle supports data sovereignty while allowing organizations to manage their data and cloud infrastructure across national borders.
“Oracle is on par with the big three, like Tesla, in challenging the Big Three automakers in the US,” Westfall said.
In April 2023, Wall Street analysts at Guggenheim said Oracle benefits from a “4th mover advantage” in the cloud, with price advantages and “deep technology,” including clustering, storage and overall efficiency. “While there doesn’t seem to be a single silver bullet, there may be hundreds of them, as Oracle has built upon the successes and shortfalls of those that came before it while infusing decades of technology innovation that is the core of this company,” the Guggenheim analysts said.
Oracle’s cloud leadership is reflected in growth (but not market share — at least not yet). Oracle cloud revenue exceeded licensing revenue for the first time in fiscal Q3 2024 and jumped 25% to $5.1 billion, according to results reported this week. However, Oracle had just 2% public cloud market share in Q1 2024, according to a report from Synergy Research. That compares with 31% for AWS, 24% for Microsoft, 11% for Google, 4% for Alibaba, 3% for Salesforce and 2% each for IBM and Tencent.
Microsoft partnership burnishes Oracle’s appeal
Oracle’s Microsoft partnership is a significant component of Oracle’s attractiveness to enterprises, Westfall said. Last year, Oracle and Microsoft partnered to run Oracle Autonomous Database in Microsoft Azure data centers for enhanced performance, ease of management and security and to enable AI applications.
On Thursday, Oracle announced it’s extending the Microsoft partnership to five new Azure regions—Central India, Italy North, Southeast Asia, Sweden Central, and United Arab Emirates North—bringing the total to 15. Other regions where you can get Oracle Autonomous Database on Azure are Australia East, Brazil South, Canada Central, France Central, Japan East, United Kingdom South, Central United States, and South Central United States.
The partnership will make it easier for enterprises to move on-premises workloads, which still comprise 70% of workloads, to the cloud, Leo Leung, VP of OCI and Oracle Technology, said in a call with journalists and analysts Wednesday.
“We’re all superhyped about AI and generative AI, but so many customers are running their own applications on their own premises,” Leung said. “We’re going to migrate and we’re going to modernize.”
Users can provision and manage their Oracle databases and Azure infrastructure using shared tools, and Microsoft and Oracle will partner on sales, Westfall said.
Oracle partnerships may go beyond Microsoft: On this week’s earnings call, chairman and CTO Larry Ellison said other deals are in the pipeline. The company did not respond to a request for comment on details on possible deals.
*I was initially going to compare Oracle to Joe Pesci’s “Goodfellas” character — he started as a shoeshine boy but ended up as a full-fledged gangster. But then I remembered that Joe Pesci and everybody else in that movie is evil. And I remembered how Joe Pesci’s character ended up. And was Joe Pesci’s character actually a full-fledged gangster — was he “made?” I couldn’t remember — I haven’t seen “Goodfellas” in years — so I went to Wikipedia and pretty soon I was watching “My Cousin Vinny” and my editor was yelling at me.
Ed. Note: We don't yell at our writers here Silverlinings. However, they do fear us.