Oracle Continues to Make Cloud Progress

Well if you're going to make a dramatic about face from total dismissal of cloud computing, this is a relatively credible way to do it. Following up on its announcement of a serious cloud future at Oracle Open World 2011, the company delivered new cloud services with some credibility at this last week's show. It's a strategy with laser focus on selling to Oracle's own installed base and all guns aimed at Salesforce.com. While the promise from last year was a homegrown cloud strategy, most of this year's execution has been bought. The strategy is essentially to deliver enterprise-class applications and middleware any way you want it - on-premise, hosted and managed or true cloud. A quick look at where they are and how they got here:

* A real Software as a Service portfolio now - On the SaaS front, nearly all of Oracle's new announcements were the integration of its myriad SaaS acquisitions in 2011-2012 - social sites, business intelligence, marketing services, etc. They are basically filling out a portfolio of SaaS services that include its Oracle Fusion Applications. So now, what about the legacy applications - when will they move these to SaaS? Customers shouldn't wait around for Oracle to migrate its older, on-premise applications to the cloud; there's no clear roadmap for that to happen. What Forrester clients should count on, are new generation SaaS applications that eventually will replace the on-premise predecessors. Oracle's fast path to SaaS is through M&A, so despite the remarks from Oracle's CFO Safra Catz last week, Oracle clearly isn't done buying its way into the cloud space. Not by a long shot.

* OnDemand is not cloud...or is it? - You could have made a drinking game out of all the Oracle spokepeople's slipups when they talked about the portfolio of managed services called OnDemand - oops, I mean Oracle Cloud Services. Despite the official line from Oracle being that OnDemand is not part of the Oracle Cloud Services family, that wasn't clearly communicated across all the session speakers. Several speakers from the OnDemand team, kept using the cloud and OnDemand terms interchangeably. Don't be fooled by this. There are security, control, agility and most definitely cost differences between the three modes of hosting (see chart below). If Oracle sets up and manages an Oracle implementation specifically for you on isolated resources with a unique configuration, you're paying more for that and are likely locked in for multiple years. You won't get pay-per-use, auto-scaling, fast feature enhancements or self-service. But then again, many of you don't really want that. Ellison is right when he says that customers want the choice of SaaS versus managed hosting versus on-premise. And he's right that he can offer all three choices on the same common infrastructure layer. Just know going in that there are many, many differences between all the services being marketed as cloud, and you should know which deployment choice you want before talking with Oracle. 

Chart: How Cloud Services Differ

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

* Cloud Platform, Delivered - True to its word, Oracle took the "preview" tag off its Java Cloud Service and it appears to be a legitimately valuable offering. Nearly everything you would expect from a Java EE environment on-premises has been faithfully reproduced in a multitenant, virtualized cloud offering here. But don't think this is an Amazon Web Services or Microsoft Windows Azure competitor - in our assessment it's aimed squarely at existing Oracle WebLogic Server customers. The Platform as a Service solution uses OracleVM (the Xen hypervisor atop Oracle ExaLogic appliances) as its basis for multitenancy and isolation but the instances provided are prepopulated with Oracle Linux and WebLogic as your only OS and middleware choices. And the packaging is best suited to non-elastic, traditional JavaEE applications. You get 1, 2 or 4 instances with requisite heap, storage and network at a fixed price per month (ala Salesforce.com's Java service on Heroku, non-coincidentally). No per-hour or per-resource pricing. Scaling is scheduled, and not automatic. And selected services are not there yet.  The Oracle Java Cloud Service does not yet support JMS or identity federation, and Java EE 6 is not fully supported. EJBs, JSF, JSP, web and REST Svcs (JAX) are all supported and each instance gets its own database (isolated via schema from the Oracle Database Cloud Service) pre-integrated via JDBC and the Java persistence API. You can manage and monitor your Java workloads via Ant, Maven, the CLI or Oracle Enterprise Manager (the portal) but you can't monitor the underlying infrastructure and you can't programmatically control the environment via RESTful APIs. Oracle has done a nice job with IDE integration via plug-ins for Eclipse and their own Oracle JDeveloper and NetBeans solutions. It has a whitelisting feature for catching, while you are coding or publishing, commands and service requests that are not supported by its cloud. Bottom line: Forrester believes Oracle's Java Cloud Service is designed to service traditional, Systems of Record Java applications - not the new generation, elastic, componentized Systems of Engagement apps. Last year, Oracle positioned the Java Cloud Service as an extensibility platform for its SaaS offerings, similar to early positioning of Force.com from Salesforce.com. No announcements were made that built this positioning. 

* The Promise of Private Clouds - Ellison, in his Sunday keynote also promised a bright future for the cloud portfolio of services hinting at what sounded to many as Infrastructure as a Service but what is really more PaaS and managed services. He spoke about the common infrastructure services that underlie the Java Cloud Service and the overall Cloud portfolio being made available to customers. What that really meant was:

1. A series of Oracle Cloud Services - Not IaaS but application services such as the Messaging Service; and a developer service that would add pre-built test and development frameworks, source code repository and other team development tools. Both are in limited preview today. Oracle head of all-things-cloud, Sandeep Banerjie, was pretty clear that the company saw little value in providing a raw IaaS offering from its data centers. However that could be different on-premise...

2. An on-premise managed private cloud service - Want the virtualization and consolidation benefits of Oracle Cloud Services but in your own data center? Give Uncle Larry a few racks and he'll roll in the equipment and remotely manage it for you. This solution, expected sometime in 2013, will be a fully managed extension of the Oracle Cloud, Banderjie said, where Oracle owns the assets, manages the hardware and the software for the solution, and links it via secure network (probably VPN and MPLS) to your tenancy on the Oracle Cloud.  This version may expose OracleVM directly for hosting non-WebLogic workloads in just the same way that the new ExaData appliance can do for fully isolated Oracle database instances. To be determined.

Roll it all up and you have a pretty well thought out and executed enterprise-centric cloud strategy. In Forrester's eyes, Oracle isn't looking to court non-Oracle customers with these offerings, nor the individual developers who helped pioneer the cloud movement but that has never really been their market. If anything, Oracle is hoping this strategy will keep their customers from developing a wandering eye. Every keynote, when talking about cloud, was clearly themed around matching and differentiating Oracle's solution against Salesforce.com who brings a disruptive , pure-play cloud story. Sadly the demos and rhetoric look like "me too" offerings rather than presenting new or better business value. And yes, for customers who want to go cloud at their own pace and keep a lot on premise, the Oracle approach preserves those choices. 

And if they are wrong, they can always buy more cloud players. 

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