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Oracle to Compete with Amazon

Ellison claimed his SaaS and PaaS customers asked for IaaS

Oracle CEO Larry Ellison, a late convert to the cloud, formally announced the coming of an Oracle Infrastructure-as-a-Service (IaaS) cloud to compete primarily with Amazon Web Services.

The announcement was made during his keynote Sunday at Oracle OpenWorld. Larry, being Larry, and this is so Larry, actually let the cat out of the bag a couple of weeks ago during the company's conference call with Wall Street when it reported its numbers.

One little detail Larry didn't mention before, the new cloud is gonna be based on Oracle's own eight-core Xeon-based InfiniBand-linked Exa- hardware, its Exadata, Exalogic and Exalytics machines including a new Exadata database machine that houses enough built-in memory that users won't need external storage so kiss off, EMC and Hitachi.

This new Exadata X3 will have 26TB of processor memory - 4TB of storage per rack and 40TB of compressed data in main memory. (Compression is big in Oracle's sales pitch.) The X3's 22TB of flash computer memory is four times as much flash storage per rack than the previous Exadata version and it's supposed to process data way, way faster than disk-based systems.

Ellison claimed that "Customers will save so much money on storage that it will pay for that Exadata X3 over and over again."

The box, which will compete with SAP's HANA database - the X3 is supposed to process 52 times as much data as HANA - and IBM and HP systems, will start at $200,000 with deep discounts available,. That's reportedly one-eighth the price of IBM machines.

Oracle wants to replicate its IaaS widgetry on a customer's site as an Oracle Private Cloud. In both cases Oracle will own the hardware and manage it.

What's still unclear is when either of them will actually get here and what it'll all cost - other than that it'll be utility pricing. Oracle co-president Mark Hurd was on CNBC Monday afternoon indicating Oracle will sweet-talk accounts with tales of how much money it can save them on storage.

The new cloud-based multi-tenant Oracle 12c database is key to the scheme and that won't be out until early next year so that may be the clouds' target date. Multi-tenancy will let users gang their databases on consolidated servers, move some of the workload off the apps and, Ellison says, provide the security that multi-tenancy at the application layer doesn't provide.

Since it's a "container" database meant to hold lots of databases, multiple companies can also share the thing while keeping their data separate and sharing underlying hardware resources like memory or file storage.

Reportedly based on a fundamentally new architecture, separate memory and processes are allocated to each database and users can take "one dedicated set of memory, one set of operating system processes, and then plug multiple separate private databases into that single container."

Ellison called it the "first multi-tenant database in the world." It's definitely the first major revision of Oracle's database software in five years and compared to the current Oracle 11, the 12c is supposed to use one-sixth the hardware and run five times as many databases.

Oracle IaaS widgetry will include its own operating system, virtualization, middleware, storage and of course apps.

Ellison claimed his SaaS and PaaS customers asked for IaaS. Whether they had something other than what he called "plain old commodity infrastructure" in mind remains to be seen.

Oracle is flying in the face of conventional cloud wisdom by using a scale-up approach based on specialized high-end boxes rather than a web-scale scale-out approach like Amazon, Facebook and Google. It'll be brilliant if it sells and creates a natural marketplace for Oracle's hardware, whose revenues dropped 24% last quarter to $779 million.

TechCrunch, for one, thinks "Amazon has nothing to worry about. Oracle will never win the cloud without developers....Oracle will never match Amazon Web Services' (AWS) first-class treatment of the developer community. Nor will Oracle even try: it's a vertical iron machine that Ellison believes has the power to be the new ‘cloud' for IT. It is not a horizontal distributed, self-service environment that you get when you use AWS. By ignoring developers, Oracle has lost before it has even gotten started. A service like AWS scales because the people who use it are developers. And those developers create apps that power services that millions of people use....Without developers, Oracle's cloud play will become limited to a traditional base of customers who have a heavy dependence on legacy solutions and are committed to integrating Oracle-engineered systems."

There is one thing, though. Oracle, like IBM, knows how to sell to the C suite where the bills get paid.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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