Oracle OpenWorld was strongly dominated by the company's splashy announcements about cloud computing and integrated hardware platforms. Tim Jennings, chief analyst for enterprise IT at Ovum, weighed in on the bigger picture of the database giant's strategy and market challenges.
The interlocking components of Oracle's cloud strategy will be particularly important to enterprise customers, Jennings believes. "An enterprise customer wants to see an enterprise-grade cloud that meets its needs and objectives. From Oracle's side, this is a maturation of strategy - two or three years ago it was mostly hype."
Large customers have particular concerns about issues like data geolocation, Jennings notes, where uncertainty over the physical location of data, and the jurisdictions which may apply, can have regulatory or compliance ramifications.
Specific highlights of the Oracle cloud are targeted at these concerns, Jennings says, such as private cloud options to counter jurisdiction issues, and easy migration of services from public to private clouds to ease deployment and scale.
And some shortcomings may yield windfalls for partners. Oracle's aggressive roll-out of regional data centres will help, he says, but many regions are not yet on the roadmap, including SA. Here, that role will fall to partners, and the integrated stack the company is providing is aimed at helping system integrators (SIs) build out cloud services for resale.
"The big SIs have the scale to build their own clouds, and they are doing that. The engineered systems open that opportunity to smaller SIs at a regional level. And with the managed private cloud option, whether that's directly from Oracle or through a partner, it's another deployment option. It gives the customer the opportunity to think about cloud and make the choice themselves, and the ability to migrate over all those deployment options without making a change.
"You have to think of it as a continuum - it's not all or nothing. There'll be some workloads, SME applications where the issues aren't there, happy to put them into a cloud, building up experience from there until they feel better from a risk perspective. But there will be some workloads that people are never happy to put in the public cloud."
Enter the private cloud, and Oracle's plan to provide customers with the same hardware/software stack it uses in its own data centres. The hardware stack is a tuned rack crammed with fast flash memory for database and analytics jobs, similar to SAP HANA and IBM solidDB. Oracle's hardware business was originally based on HP technology, but using Sun Microsystems kit following Oracle's acquisition of Sun in 2010.The hardware side of the company has been struggling, but Jennings puts that down to a Sun-related hangover, and predicts improvements.
"Competitors have had continuity, but at the start of Oracle's Sun acquisition it was worse than a standing start - it was a distressed start. If you look at processor generations and timeframes, it takes a while to get to a level of maturity. From an engineered systems perspective, the pipeline's strong, making a very real difference in performance. But, more important is seeing integrated systems from competitors like IBM: that's good validation that that's the way the market's going."
From a period of commodity server hardware, the world is moving back to tightly-integrated systems, Jennings says, largely driven by management costs. "In terms of the cost of that stack, the proportion that relates to management has just gone up and up, so it's all about efficiency and efficiency of management. Such a high proportion of TCO is in the management piece. [Staff reduction] has been a big factor in integrated systems, it makes sense to not focus on shaving a few cents off in commodity versus premium components, but pushing the smarts into reducing the management costs."
Similarly, many companies are sidestepping the mix-and-match approach promised by Web service/SOA (services-oriented architecture) adherents, and looking for more thoughtful integration, Jennings says.
"Integration is going to be a very hot topic of conversation over the next year or two. As an enterprise customer, what do you do in terms of that cloud strategy? Are you going to want the hassle of integrating different services, and if so, what level are you able to integrate them at? There's an infrastructure layer that's about portability of workload across different clouds. I think most enterprise customers don't want to muck around at that level. At the platform level, at the software level, there's always going to be heterogeneous.
"I think SOA is still very important. What we've seen from our client base is a much more mature proposition. It's not that initial premise of very granular services. We haven't by and large gone down to that level of granularity, but I think what they have done is put in much more loosely coupled SOA/ESB [enterprise service bus] - more suitable for cloud integration. For people who have made a decent investment in SOA, I think that'll stand them in very good stead."
Oracle, with its drive to deliver every component in the enterprise software stack, has its work cut out keeping up with the market, Jennings says. "Having plumped for that end-to-end strategy, it puts the onus on Oracle to have something in every segment. One of the areas is mobile device management - right now that's becoming a hot category, and it's not something where Oracle's got a particularly strong offering. In the past, you might have been happy to say 'that's not a market we want to play in' and use third-party MDM solutions, but I think now customers will say 'we want an end-to-end story and we'd prefer it if Oracle had an MDM solution'."
Lastly, Jennings suggests an area where the Oracle portfolio could use fleshing out is in industry-specific solutions, with custom-built stacks for financial, healthcare, retail and other vertical markets. "I think there's a lot of interest in industry-specific services. The market hasn't gone particularly specific in terms of cloud yet, but why not? Why shouldn't Oracle set up an industry-specific cloud for healthcare, for example?"
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