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Taneja Blog

Taneja Blog / Data Center Systems

Oracle Takes Convergence to New Extremes

Regardless of naysayers, convergence is the new rage of this era. Convergence is taking several forms currently. The first one is exemplified by VCE where basically compute, storage and server virtualization are packaged and tested together for specific workloads; the second one is exemplified by the hyper scale cloud vendors like AWS where commodity servers and storage are combined with proprietary software to create large scale “clouds”; the third is exemplified by Nutanix and SimpliVity where commodity compute and storage and many other disparate technologies are intimately integrated in a scale-out architecture to create web scale farms of computing for mixed workloads; and finally, and most relevant to this blog, convergence of the entire stack from chip to application to cloud, using products based on industry-standards, as exemplified by Oracle.

The first three versions are well understood by now and, without exception, they are all growing aggressively in the marketplace. So what about the fourth one? While it does not have a name assigned to it, this category harks back to the old days when you bought the entire stack from IBM or DEC or Data General or Burroughs. When I say the entire stack I mean the entire stack, including databases, networking, virtualization and applications. Of course, in those days, nothing made by outside vendors would run on the stack unless it was expressly authorized by the vendor. In today’s incarnation, given a wide variety of standard interfaces, “foreign” hardware and software can be attached and run with this solution, albeit in less than optimal fashion. This is what Oracle’s “Oracle on Oracle” strategy represents. And by all measures, Oracle’s revenue growth is on fire. So why is Oracle doing this and why is it important?

In my view, all forms of convergence are being accepted by IT because they bring simplicity in purchasing, deployment and management, and lower cost to infuse some level of sanity back into the game. Maybe open systems went too far and integrating thirty products from twenty-five different vendors became too cumbersome, if not impossible? As is often the case in our industry, the pendulum swings too far in each direction. Well, if it wasn’t clear already the pendulum is now swinging hard towards converged systems. How deep the convergence goes, how tightly coupled the elements are, what piece parts are used and how many “alliances” are involved varies by the vendor, but the essence is the same: combine elements to reduce cost and complexity.

Oracle takes this farther than anyone else in the industry. Why? Because they can. Look at the pieces of the infrastructure and application stack that Oracle has a presence in. Virtualization—yes. Databases—yes. Big data appliances—yes. Data protection—yes. And by now it should be clear to the observer why Oracle bought Sun. Sun brought them critical elements of storage, operating systems, high-end servers, chip technology, file systems and more. Right under the competitor’s noses Oracle was completing the stack elements. And streamlining them. And adding optimization that one can only have when one owns the elements and has infinite visibility into the code. And now they are ready. They call it Oracle on Oracle. The war is on and Oracle has now taken on many vendors who were otherwise partners in the past. These include EMC, Cisco, IBM, HP, NetApp and others. And AWS, Google and Microsoft Azure.

The war has only just begun. And at this time Oracle seems to be winning. Because of the optimized stack, if Oracle databases and Oracle applications are involved, Oracle claims to beat everyone else to a pulp. Instead of relying on AWS and other public clouds, Oracle has produced its own, built from the same elements used on-prem and therefore 100% seamless and compatible. Oracle claims cost advantages due to seamless scalability and optimization (lower cost per VM or lower cost per GB, for instance, enabled by vertical integration).

Instead of redoing everything from scratch (a la AWS), or doing partial convergence (a la VCE), Oracle is taking a page from the old book and converging all of the products in its portfolio. For example, Oracle is converging its database with its processors; its database with its storage systems; the cloud with its engineered systems.

My position is simple: if Oracle is already a strategic partner for you and you have a trusting relationship with Oracle for years, you can hardly go wrong in staying with Oracle. And if you only want to run Oracle Database and not use the company’s hardware stack, you can continue to do so. All of Oracle’s software, hardware and cloud offerings can be purchased individually and used with third party applications and hardware with no issues whatsoever—however, when operating them in unison, net incremental capabilities are enabled, such as auto tuning, auto tiering and auto compression of Oracle Database data. But the message from Oracle is clear: let us worry about the architecture and the elements of the stack; you worry about running the applications and maintaining SLAs to keep the business groups happy. If nothing else, it is a strategy of “comfort” and “safety net.”

Oracle is uniquely positioned to deliver on this strategy. They own practically every element of the stack, judiciously assembled over the past decade and now tightly integrated and optimized. IBM potentially could but they gave up control in several important elements of the stack so getting them back might be a stretch. And in any case, they are divesting their hardware business while Oracle is investing. HP could to an extent, but they lack a database and just shut down their public cloud. EMC/Dell will remain a mystery for the next 18 months, which is a gift from the heavens for Oracle, since the greatest threat would have come from EMC/partners. And the hyper scale cloud vendors will only become a major threat if they can woo enough large IT users to run serious, mission critical applications in the cloud. Until then, it will be a hybrid cloud world for enterprises, and Oracle can solve both ends of the spectrum with on-premises enterprise solutions such as FS flash storage and Exadata and complimentary consumption-based services in the cloud like the Database Backup Service and the Big Data Cloud.

The game has only just begun. No victory can be declared yet. All one can say is IT infrastructure is under attack and a plethora of approaches are vying for attention. They all have “convergence” in common. We are convinced the Oracle on Oracle strategy will immensely appeal to those IT shops that are heavy into Oracle databases and applications already. And that is not a small number, given their market share. The challenge for Oracle is to maintain a level of “freedom,” continue to support non-Oracle products (albeit in somewhat less optimized way), offer simplicity to rival those of hyperconvergence and the public cloud, and in general maintain a humble posture.

It is the 30-year anniversary of the movie Back to the Future. It could not be a more appropriate tag line for the strategy that Oracle has embarked upon. Competition better watch out—Oracle is no longer just a database company; they want to eat your entire lunch, including appetizer, entrée and dessert!


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