MS, Oracle partnership aims to ‘completely disrupt’ AWS

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Phil Dunn, director of competitive intelligence at Oracle.
Phil Dunn, director of competitive intelligence at Oracle.

Oracle’s partnership with Microsoft will “completely disrupt” Amazon Web Services (AWS), and provide seamless connectivity between Azure and Oracle Cloud Infrastructure (OCI) to South African organisations.

This was the word from Phil Dunn, director of competitive intelligence at Oracle, speaking to ITWeb on the side-lines of the Oracle Systems Forum in Johannesburg yesterday.

In an unexpected move, the enterprise software giant and Microsoft announced an interoperability partnership between Azure and OCI in June.

While the companies are rivals in the database software and cloud platform markets, the new alliance means enterprise customers using Microsoft and Oracle technology stacks can take advantage of the interoperability and integration, by deploying applications that run across the two public cloud environments.

Amazon is the largest cloud provider globally, followed by Microsoft's Azure, with Google Cloud trailing behind. Oracle controls nearly half of the global database market, but its cloud platform is small compared to AWS and Azure.

This year, Microsoft announced the opening of two data centre regions in SA. Last October, AWS also said it would bring its data centres to SA, opening an infrastructure region in Cape Town in the first half of 2020.

AWS reaffirmed its commitment to investing in the South African market at its African AWS Summit held earlier this month.

Dunn expressed Oracle’s ambitions to challenge AWS, through the Microsoft partnership.

“This partnership has completely disrupted AWS in the cloud space. While we acknowledge they are an 800-pound gorilla, and they have been around for many years, especially in the infrastructure-as-a-service space, their infrastructure is not enterprise-grade or enterprise-ready. Where Microsoft and Oracle have a 30- to 40-year history working with enterprises, so both companies have an in-depth understanding of the priorities and challenges faced by $100 million companies.”

Both Microsoft and Oracle have invested in dedicated private networks to connect enterprise data centres with their cloud platforms. These are Express Route on Azure and FastConnect on OCI.

Discussing the benefits of the partnership to local customers, Dunn explained that both companies will no longer need to route the traffic through an intermediate service provider for establishing connectivity between the two clouds.

“The partnership came out of the realisation that Microsoft and Oracle have shared customers who are using Microsoft 365 and Oracle Cloud. A lot of our cloud customers who want to move their workloads to the cloud and leverage all the capabilities of a cloud environment, face migration challenges because certain types of workloads are very database-dependant.

“The partnership enables South African customers to easily migrate and run mission-critical enterprise workloads across Microsoft Azure and Oracle Cloud. This means enterprises can now seamlessly connect Azure services, like Analytics and AI, to Oracle Cloud services, like Autonomous Database,” he noted.

The benefit for Microsoft, he continued, is that its customers will now have the best of worlds, leveraging on Oracle’s hardware infrastructure and benefitting from Oracle’s Database Exadata Cloud Service, which is ideal for running high-performance secure databases, allowing customers to run applications in Azure without the challenges of latency.

“So, over time, we are going to be connecting our data centres across the globe. While Oracle doesn’t have data centres in Africa, we do have goals to get there in future.”

Cloud wars intensify

SA’s cloud market is forecast to grow by 29% in 2019 to $637 million, from a base of $494 million in 2018, according to IDC.

While growth is strong across the board, platform-as-a-service is expected to grow the fastest (32%), followed by software-as-a-service (30.9%), with infrastructure-as-a-service (24.6%) ranking third.

There is a flurry of activity in the local cloud computing market, with a number of multinational companies forging key alliances in a bid to outdo competition.

IBM recently acquired Red Hat in a $34 billion deal that is expected to have a significant impact on the local cloud market, as the companies aim to offer a “next-generation” hybrid multi-cloud platform.

IT services company BCX also partnered with Microsoft to help local organisations migrate their applications, data and infrastructure to Microsoft Azure Cloud and Microsoft Office 365.

In May, Vodacom announced a strategic partnership with AWS, which will see the telco become both a customer of AWS and a reseller of AWS services.

Arthur Goldstuck, World Wide Worx MD and chairman of Sasfin’s digital advisory council, explains collaboration between large IT companies can make it a lot easier for South African organisations to pursue a multi-cloud strategy.

“The partnership between Oracle and Microsoft shows they are willing to do what it takes to meet the needs of customers, and are willing to set aside competitive differences to leverage each other's strengths for the benefit of customers,” Goldstuck points out.

“Local customers that have cloud vendor loyalty with Microsoft can continue to leverage the power of Azure Cloud, while benefiting from the fast autonomous database solution that Oracle is pioneering. The partnership also removes some of the system lock-in that tends to be associated with Oracle, which allows clients to draw on the strengths of both providers.”

In terms of disrupting AWS, he explains the partnership between Oracle and Microsoft is powerful enough on its own merits to succeed, without having to rely on disrupting a market that is still in a growth phase.

“It must be understood that true migration to the cloud is still in its infancy in SA. The Azure data centres have been in place for less than six months, and AWS will only open its data centres in SA early in 2020. We will see a steady acceleration of uptake in this market over the next three years or so, and talk of disruption is not only premature, but also not playing to the strengths of this offering.”

Cloud providers like AWS and Google Cloud have a range of strengths across numerous categories of services and applications. While Oracle and Microsoft are competitors in a broad sense, they serve different needs for different customers, and will in combination have a different value proposition to AWS, adds Goldstuck.

“AWS is strong in content hosting and distributed services, and is the backbone of many content-heavy services with global distribution, like Netflix and Uber. It is also preparing to open two data centres in SA.

“Google Cloud, on the other hand, is strong in server-less computation, which, for example, helps Spotify compute recommendations on-the-fly in the cloud at relatively low cost.”

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