How Oracle plans to crash the wedding
It may lag behind in public cloud popularity, but Oracle claims to be seeing success moving its core offerings to the cloud
When it comes to dominating the public cloud sector, Amazon Web Services (AWS) is the bride, with Microsoft Azure and Google following it down the aisle as bridesmaids.
In this scenario, Oracle would probably be the flower girl - still in the party, but not the centre of attention.
However, despite its lagging in the public cloud space, the vendor remains dominant in its traditional database market, with founder Larry Ellison claiming that its share of the market far outstrips that of its public cloud rivals.
During a Q2 earnings call with investors in December, Ellison declared that Oracle plans to move its 50 per cent share of the database market to its public cloud, which in turn will quickly scale its share in infrastructure-as-a-service (IaaS).
At Oracle's OpenWorld event in London, execs were keen to emphasise this shift to cloud-based services, and to highlight what it means for partners.
Javier Torres, VP of EMEA channels, stated that this switch to cloud-based services will eventually result in "fewer and better" partners specialising in Oracle's cloud
Although this may look like a threat to partners' current business models, they should view it as an opening to win more business, according to the channel boss.
"This is a disruption for the business model of the partners - their core business model is at risk," he admitted.
"But it is also an opportunity for partners to capture more market share.
"We are acknowledging two things: one is that the model will go into fewer and better partners, focusing on the ones that are really making a difference.
"But on the other side we are also supporting partners to bridge that gap. We have a couple of programmes to support them in doing that."
Torres added that Oracle's Cloud Acceleration programme is one such example where the vendor provides support to partners as they move to cloud specialisation.
He added that 200 partners across EMEA are currently taking part in the programme, and that other sources of support come from VADs which provide training to smaller partners.
These distribution partners create cloud centres of excellence to support Oracle's smaller partners as they move to cloud services.
"We have thousands of partners in cloud and great geographical reach, so we are asking VADs to help us cover the market and to work with smaller partners," Torres said.
"We are also investing in support for the wider partner base to transform their business model in moving to the cloud."
Exulting ERP
In that same second-quarter earnings call in December, Oracle co-CEO Mark Hurd revealed that the company would be looking to expand its leadership in enterprise resource planning (ERP).
He told investors that ERP has always been the largest segment of the vendor's enterprise applications business, and that it will continue to grow as customers migrate from their traditional on-premise ERP to the Oracle Fusion ERP cloud.
"When we combine ERP and autonomous database…we can get into close to $1bn worth of growth next year out of those two solutions," he said.
Backing up Hurd's words, Torres stated that its three-pronged strategy to expand in the ERP space is seeing it lure customers away from competitors.
"We have a big focus on migrating our own customers to the cloud," he explained.
"We also have a good number of net new customers from different segments of the market.
"Thirdly, we are starting to see cases where we are taking customers from competition. I would say we are focusing on those three areas to continue expanding our ERP."
The channel boss said that although the number of customers moving to the vendor from its competitors is still relatively small, he foresees it growing despite the how complex moving ERP can be.
"In the last year, our focus has been to position how ERP operates. We are making it simpler for customers to move to the install base with an ERP cloud," he said.
"As we start to gain momentum - we have 6,000 customers globally - we see the opportunity to take away customers from [our] competition."
He also emphasised how Oracle is capturing the ERP market for both the enterprise and SMB spaces through its own-brand Fusion ERP and NetSuite (which it acquired for $9.3bn in 2016) offerings.
"If you look at the partner quadrant, the number one solution is Fusion ERP, and the number three solution is NetSuite, which is a very specific solution for the mid-market," he explained.
"We are combining a high-end car with a utility car, so we have the best of both models on the market."
The overall message that Oracle wants to convey to partners is that now is the time to act to capture the cloud opportunity, according to Torres, and some OpenWorld attendees have taken this message to heart.
Alberto Guzzi, CEO of Italian partner Red Reply, said that it has seen success - including winning the Oracle's autonomous database partner of the year recently - since implementing the vendor's autonomous database into its own offering about two months ago.
"There are a lot of customers that use the public cloud service but the workload stays on premise because there is no technology to run it," he explained.
"Using the Oracle infrastructure we can move these workloads from one place to cloud because we now have the infrastructure performance to do that.
"Autonomous database is the same as the Oracle database but with all of the capabilities automated, so you can spend your time building the solution, not spending it doing administrative tasks, tuning the performance, or security patching."
The opportunities that cloud provides partners are ripe for the picking, according to Torres.
"[Partners] have to continue investing and developing their enablement and solutions that will bring customers faster to the cloud," he said.
"The time is now, the market is really deep in cloud and customers are talking about this. Even if it is something that will happen in two to three years, they have to act now."