Oracle ramps up investment in Europe's cloud - exclusive interview with EMEA chief Loïc Le Guisquet

Profile picture for user slauchlan By Stuart Lauchlan January 13, 2016
Summary:
Europe's becoming a happy hunting ground for US cloud vendors. Oracle's now scaling up its cloud headcount in the region, says EMEA President Loïc Le Guisquet.

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Loïc Le Guisquet

Despite what at times has seemed to be the best efforts of Brussels to deter them - see (un)Safe Harbor and the implications thereof - a defining characteristic of the cloud industry in 2015 was the identification of Europe as a major market for expansion.

To date, one of the most notable manifestations of this has been the expansion of operations and opening (or planned opening) of data centers in-region, as seen by the likes of Microsoft, NetSuite and Salesforce.

Oracle has long had in-region EMEA data centers and will be expanding its footprint on that front in 2016, with, in the case of the UK, a particular eye on the public sector.

It’s also today announcing a ramping-up of its cloud operations across Europe, with an initiative to recruit 1400 new cloud-centric employees across Europe, the Middle East and Africa (EMEA).

Specifically Oracle will be expanding its cloud footprint in a number of European cities - Amsterdam, Dublin, Malaga and Prague - alongside Dubai and Cairo, as well as opening new cloud sales arms in Amsterdam and Cairo.

It’s a pretty significant uptick in operational capabilities, which Loïc Le Guisquet, President EMEA and APAC at Oracle, characterizes as building on the firm’s long-standing, 30-years-plus heritage in the region. (The UK was the company’s first non-US direct operation back in the late 1980s.)

In an exclusive interview with diginomica, Le Guisquet made it clear on what makes Europe currently so attractive to US cloud vendors:

The region is attractive for a variety of reasons. Many of the biggest end-user organizations in the world are here. Many are growing their presence in the region and each is at a different stage of their journey to the cloud. Whether customers are making their first steps into the cloud with SaaS applications or are taking a more major step towards basing their entire enterprise IT strategy around cloud, EMEA offers a very attractive mix of businesses ranging from more mature cloud markets to emerging markets.

One fallacy that has in the past been made by some US vendors is that Europe can be treated as a single entity, whereas in reality, again despite the best efforts of Brussels, cultural and national identities remain strong. There’s also of course varying rates of adoption of new technologies, including cloud computing, in different areas of the region.

Oracle’s presence in the region since the 1980s should obviously serve it well in terms of an appreciation of the range of customer needs and expectations around cloud take-up. The firm has been round the block a few times before in this respect. Or as Le Guisquet notes:

The diversity within EMEA precisely reflects that no two companies, or even markets, adopt cloud in the same way. Some adopt slowly from the bottom up, some are decisive and drive from the top down and we’re very happy to work in either way. We are dramatically growing our sales force across the region to support our customers through their digital transformation.

US v Europe

It’s often been said that Europe is a year or so behind the US in terms of new technologies, although in areas such as mobile that’s a moot point. Whatever the reality,  Le Guisquet doesn’t see comparisons across the Pond as particularly helpful:

The US and EMEA are such different markets. Different economies and differences in infrastructure across EMEA make overarching comparisons with the US almost meaningless. So rather than focus on which market is the biggest, or which presents the greater opportunity, we need to focus on delivering what each customer wants in every market we operate.

In EMEA, Oracle successfully operates in 59 countries and we already employ over 27,000 employees. We’re now recruiting an additional 1,400 brilliant, ambitious and cloud-savvy people to capitalize on the growth here in the region. We’re looking for people who want to be relevant to the biggest trends shaping business and technology.

What those trends are, in terms of which business sectors, also varies, he adds:

Established and growing business and financial hubs, from London to Frankfurt to Dubai means there is certainly a considerable appetite across EMEA for ERP applications. Businesses are getting far more serious about the way they are run and looking to ERP as a key opportunity to innovate and improve their own processes.

But we’re also seeing a commitment among customers to break down the silos within their business and improve the way they handle data – quickly and effectively - in the name of human resources, customer experience and every other part of the business.

Oracle’s also made noises about chasing a bigger chunk of the public sector market in the UK, with its new data center in Slough being dubbed a ‘G-Cloud’ center by some commentators last year. That’s true, says Le Guisquet, but isn’t the over-riding driver behind the increased cloud investment:

We have made significant investments in our cloud offering to the UK public sector and that has been well reported. Naturally the public sector is a huge opportunity and will remain one as governments and public bodies look to reduce complexity and improve efficiency, but the focus of this current recruitment drive is to ensure we have the best people in the right markets across EMEA to service all of our customers’ needs. This is not being driven specifically by opportunity in the public sector.

PaaS play

One thing to watch will be how much emphasis is placed on the firm’s Platform-as-a-Service (PaaS) offerings in EMEA. This is an area that CEO Mark Hurd and CTO Larry Ellison have been pitching hard in public appearances. Le Guisquet picks up the theme, arguing :

PaaS is clearly a major opportunity for Oracle. Over the first six months of FY16 we added 2,100 new PaaS customers. PaaS is a part of our cloud DNA that customers, many of whom are new to Oracle, are getting very excited about. So that excites us. It’s about ease of use. It’s about choice, it’s about being able to quickly change direction or react to new opportunities at the speed that modern businesses need to operate at. It is a platform for smarter, better business.

The PaaS market is of course increasingly competitive and takes established enterprise players up against relative newcomers, such as Amazon, a company also investing heavily in European expansion. Le Guisquet’s response is that despite price-cutting by Amazon, it’s not all about the wallet here:

For any customer who is serious about the success of their business, decisions about PaaS will never come down to price alone. Of course we understand the need to be competitive and we are confident we offer excellent value for money, but for us that is about so much more than just delivering the lowest price possible. Technology and the digital transformation it is delivering is just too important to businesses now.

He adds:

We have continued to develop and invest in our platform to be able to offer it “as a service” to customers, and we can do this while being price-competitive with companies such as Amazon. However, for us, it is so much more that delivering at the lowest possible price. The future of PaaS is one of growth both in the size of the business and in richness of function, which is why Oracle is investing more than $5 billion per year in continuous innovation.

Of course, for any US vendor expanding into Europe, there remains that trumpeting elephant in the room that no-one wants to talk about - Safe Harbor. Struck down last year as unsafe by the European Court of Justice and with no alternative legislation agreed as yet, questions about cross-border data transfer have moved up the agenda.

As I’ve noted before, the leading enterprise players have shown an understandable reluctance to confront this issue head-on in public, focusing in instead on assuring customers that the complexities of data privacy needs can be worked around and accommodated. So it is that Le Guisquet states:

Oracle offers Cloud customers the ability to store their data in Europe. It is not sent for storage elsewhere. Certain Cloud operations may require access from engineering resources in other regions. Those resources are subject to European Union data transfer requirements without reliance on the Safe Harbor Framework.

My take

Another investment in the European cloud market by a US vendor is always to be welcomed, especially at a time when the actions of the ECJ and some in the European Commission seem set on making it as difficult as possible for non-European Union providers. More please.

Disclosure - at time of writing, Oracle, NetSuite and Salesforce are premier partners of diginomica.