SAN FRANCISCO: Larry Ellison took to the stage on Sunday evening at the Moscone Centre in San Francisco in an effort to convince his audience of thousands, the firm's customers and the world at large just how far Oracle has come in its efforts to transform into a cloud-first technology provider.
"It's been 10 years since Oracle realised that we're going to have to rewrite virtually all of our applications and make them run on the cloud as a service," Ellison explained.
"We started the Fusion project about a decade ago. It was a lot of work. It wasn't simply a matter of rewriting our applications. We had to rewrite our middleware for the cloud. Then we realised the database itself had totally different requirements to be a database for the cloud; it had to be a multi-tenant database.
"Also about a decade ago, Amazon announced EC2, the Elastic Compute Cloud known to us now as AWS. They started renting compute services on the internet. We came to realise that if we were going to be in the PaaS business, we also had to be in the infrastructure-as-a-service business. If we wanted people to use our database in the cloud, they wouldn't with just our applications."
Of course, long-term Oracle followers will remember that Ellison once took a very different, slightly less enthusiastic view of cloud computing. Famously at one financial briefing he referred to the whole concept of cloud as "gibberish", downplaying its significance on the future business of the company he founded more than 30 years ago.
But over the past few years, Ellison and Oracle have been forced to play catch up in a market that everyone agrees represents the future of technology - even Larry himself. Evidence of this has come in the form of Oracle's recent financial results calls, which now break out cloud revenues into a separate line and see Ellison, along with CEOs Mark Hurd and Safra Catz, all enthusing about the firm's latest cloud successes and ambitious growth targets.
However, to say that the firm is at the very beginning of this transition is something of an understatement. Oracle reported overall cloud revenues of $611m its Q1 2016 results, up 29 percent year on year leading to a claim from Ellison that the company is on track to reach $2bn in cloud sales in the 2016 fiscal year. However, the bulk of Oracle's revenue still comes from on-premise, which accounted for a gargantuan $5.8bn, almost 10 times as much as the firm's SaaS/PaaS/IaaS divisions.
In a bid to prove its weight in this new world, Oracle has already unveiled a wide array of cloud products and updates only a day into the OpenWorld event. Ellison also took the opportunity to have his usual dig at SAP, citing Salesforce and Workday as Oracle's biggest competitors in the cloud apps space.
"We virtually never ever see SAP. The largest application company in the world is still SAP but we never see them in the cloud," so Ellison told delegates at the show.
"Microsoft is the only one of our traditional competitors that has crossed the chasm and is now competing aggressively in the cloud business at all three layers: infrastructure, platform and applications.
But Ellison's jibes were not confined to SAP this time, and he branched out into insulting OpenWorld Grande Sponsor IBM as well.
"We compete primarily with Amazon in infrastructure - sometimes we see Google - but primarily it's Amazon.com. And we never ever see IBM," he claimed.
"This is how much the world has changed. Our two biggest competitors, the two companies we watched most closely over the last two decades, have been IBM and SAP, and we no longer pay any attention to either one of them."
Unsurprisingly IBM took issue with Ellison's comments, pointing out to V3 that the firm recently reported cloud revenue of $9.4bn for the last 12 months, representing growth of more than 65 percent for the first three quarters of the year.
Oracle is clearly paying a bit of attention to IBM, however, as the firm also revealed a new element to its long-standing partnership with Intel, which sees the enterprise tech behemoth and chip maker team up to convince Oracle database users to run these on Exadata rather than IBM Power systems.
Oracle CEO Mark Hurd was also on hand at the OpenWorld show on Monday to back up his boss's message, explaining how the enterprise tech provider will be supporting customers like GE in their digital transformation efforts, centred on cloud services.
"We're going to lead the transition to the cloud over next 10 years," Hurd said. "There's an incredible need for innovation, and there's old infrastructure and no money. This is the only way to make that leapfrog from where you are to where you need to be."
Hurd also partook in some future-gazing, making a series of predictions highlighting how important the cloud is not only to IT vendors like Oracle, but to the whole business world.
By 2025, he told OpenWorld delegates, 80 percent of production apps will be in the cloud, while 100 percent of development and testing will be cloud-based - an area that currently accounts for 30 percent of all IT, according to Hurd. Virtually all enterprise data will also be stored in the cloud, allowing better access and real-time availability
"The days of having servers and operating systems and databases and doing all this on-prem are gone. People will want a URL, they're going to want access to the best tools. All this will be done in the cloud," he said, while acknowledging that there will still be some on-premise apps in 10 years' time.
Hurd also touched on the issue of security, often the bane of cloud providers after high-profile online data breaches and leaks.
"The enterprise cloud will be the most secure environment. Oracle is there today, and the Oracle Cloud is encrypted," the CEO explained.
"Let's pretend somebody calls me up, say the US government, and says send me some customer's data. I would say no, I won't do it. They say we have a subpoena. I would comply as that's what I'm told to do. I would then send a bunch of encrypted files. You go work on these. They will not be able to make anything out of this gibberish. Our people are not seeing that data. The key to that data sits with you, not us."
Ellison also made several references to new security technology that will be built into Oracle hardware and software, and ‘always-on', so expect to hear more on that later in the week.
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