At Oracle’s annual confab, OpenWorld, attendees heard a very cloud-ish but data center focused pair of keynotes Sunday night. Intel’s keynoter waxed on about their firm’s products and how these technologies will make private cloud deployments more efficient, more secure, etc. Oracle founder and CTO, Larry Ellison, spoke about many of the same points.
Both gentlemen discussed performance improvements in computer hardware, in-memory capabilities, cloud security and more. Not surprisingly, the anchor theme for both was the explosion of big data that customers are dealing with or will be dealing with soon. That theme gave both firms reasons for promoting their respective analytics and related capabilities.
Larry also indicated that Oracle is now announcing a full cloud ERP solution among other cloud solutions (e.g., Learning Cloud). At this point, any existing or net-new Oracle customer should be able to get the entire application, middleware and infrastructure stack from Oracle. Nothing, essentially, would need to get placed on a traditional, on-premises, client server platform unless the customer wanted to custom-develop an app thusly.
In other words, Oracle customers don’t need to stay on-premises, client server anymore. That’s good because Monday started off with an expansion of these concepts. Mark Hurd kicked off Monday’s event with his big predictions. They were:
#1 – By 2025 80% of production apps will be in the cloud
#2 – By 2025 two suite providers will have 80% of the SaaS apps market
#3 – 100% of new dev/test will be in the cloud by 2025
#4 – By 2025 virtually all enterprise data will be stored in clouds
#5 – By 2025 enterprise clouds will be the most secure IT environments. Oracle is there today.
Subsequent speakers talked of their firm’s journey to the digital age. GE’s CIO made it particularly clear why their organization is moving aggressively into the cloud and why data will be the commerce engine of the future.
When you cut through it all, here’s what’s really being communicated to attendees:
- Cloud technology is supplanting client server and older tech. If you’ve been denying the cloud phenomena, even Oracle has moved, in force, to this space. While Oracle will continue to provide you air cover for your custom development environment, on-premises applications and its own client-server application software, the market is moving away from those platforms. Just re-read Mark Hurd’s predictions and see the shift he’s predicting.
- Vendors, including Oracle, are shifting to a new future that is decidedly cloud-oriented. Ellison made several comments Sunday night where he indicated that they no longer see certain client-server/non-cloud vendors in competitive deals anymore. Instead, Oracle sees more Microsoft, Amazon and Workday in its deal mix now. And, Ellison is now fully on-board with multi-tenancy.
- Oracle makes little distinction between public and private cloud – they’ll have products that work in both worlds. But the key word is ‘cloud’. Oracle’s putting in even more security at low levels in its cloud infrastructure. The future for them is the cloud regardless of deployment method.
- Oracle will continue to support its Apps Unlimited program for those customers still using its on-premises based application software products. This program is about 10 years old and it promised to support acquired product lines (e.g., PeopleSoft, Siebel, JDEdwards, etc.) almost indefinitely. Mark Hurd confirmed this in a press meeting after his keynote today. He stated that many of their new cloud deals are with net-new customers. Many existing customers are still on client-server versions of products still. They like those products, and, they aren’t planning to move off of them soon.
- Customers need help in justifying the move off of older technologies and applications. Hurd mentioned in his keynote how common it is for IT leaders to defer maintenance/upgrades of application software as a way of saving current year IT expense. However, this is a deferral of cost not outright cost avoidance. At some point, the IT technical IT debt must be dealt with. How Oracle and its partners can help customers achieve technology platform changes and apps upgrades simultaneously while also reducing a customer’s net IT costs will be interesting to watch. Until they succeed with this, Oracle’s technology direction will remain cloud focused while a number of its customers will be struggling to get anything cloud related into production.
- If Oracle can get movement in transitioning existing customers to cloud solutions, then Apps Unlimited might need to be rethought. This program only makes sense if a large number of customers are still using an older solution. While Oracle has done a nice job of reducing support costs for these product lines, the economics could someday look less advantageous. Customers might want to watch the transition of other customers to Oracle’s cloud offerings as you wouldn’t necessarily want to be one of the last to migrate to a cloud product line.
- Many firms, like GE, are already way ahead in the journey to not just the cloud but also to winning in the Digital Age. GE’s not content to be an industrial firm without a major digital future. Firms like GE will likely prosper in the Digital Age if only because of their speed in adopting new business methods/models and in acquiring more modern and relevant technology. One thing is certain for Digital Age firms is that they will need a different tech stack to handle the scaling needs and analytic requirements that sensors and other Big Data sources generate. Local, on-premises machines with limited disk storage, memory, processor speed, etc. might have been fine in the Industrial Age. They’re obsolete in the Digital Age.
If you came to OpenWorld as a die-hard on-premises fan, you likely found a number of comforting messages about improvements to the speed and throughput of Oracle (and Intel’s) hardware, database, etc. That’s especially true if you’re open to creating a private cloud but less so if you’re still in love with client server. If you came here to learn about cloud offerings, you heard a lot of comforting things, too. Every attendee probably got something to take home to justify their continued Oracle relationship.
In recent years, we’ve come to learn of a retailing phenomenon called omni-channel. It refers to the ability of customers to shop, purchase and even return items from any combination of channels (e.g., internet, in-store, mobile, etc.). Oracle promotes something that I liken to ‘Omni-cloud’. It lets customers choose whatever mode of cloud fits their temperament today with the option of changing to something else later.
Is Omni-cloud the best thing for software users/buyers? I’m not sure. Choice is a great thing but it can be quite expensive. Car makers intentionally limit car buyers’ choices to a color choice and an options package. They do this to manage costs, keep their offerings competitive and give people the most popular configurations.
IT leaders need to develop strategies NOW as to how they’ll make the shift to the Digital Age (not just to the cloud). They need to have one plan that lets them achieve business results in a record short timeframe as time is not a luxury in the Digital Age. Can Walmart afford to let Amazon eat their lunch anymore? To be truly fast and effective, companies need vision, certainty and rapid execution of same. If your firm is still delaying upgrades, staying wedded to client-server software and denying the cloud, I feel for you. Your organization just might die long before the Apps Unlimited program does wind down. What your firm needs now isn’t an infinite number of omni-cloud choices but a few well planned strategies to a big data fueled, Digital Age future.
Don’t ride out the past – embrace the present and plan for the future.
Disclosure: Oracle is a premier partner at time of writing and covered most of the author's travel expenses for attending OpenWorld.