Category

Cloud Computing

EMC: Large Enterprises Reduce Investments in Public Clouds

By | Cloud Computing, IT Strategy | No Comments

By 2016, Only 12% of Workload Will Run On Public
Cloud Infrastructure

This was the surprising perspective offered by Adrian McDonald, EMEA President at EMC, addressing the audience at EMC Forum 2013 that took place on November 4 in Tel Aviv, Israel. McDonald maintains that public cloud architecture is not the right solution for large enterprises, and, in fact, CIOs are reporting that when considering the investment in security, compliance and business continuity, public cloud infrastructure is more expensive than the alternatives.

According to McDonald, market research conducted by EMC shows that large organizations are gradually reducing application deployment on public clouds. EMC forecasts that by 2016, 12% of the workload will run on a public cloud and 12% will be using a private-virtual cloud, but 76% of the workload will require internally managed infrastructure.

McDonald estimates that organizations can cut as much as 38% of annual IT expenses through virtualization and cloud deployment. But he cautions that this is an aggressive goal that requires both IT organizations and cloud infrastructure and services providers to offer new ways to deliver flexible and agile solutions and services, such as supporting customer self-provisioning.

As reported by Ran Miron http://www.pc.co.il/?p=135820

Foes Unite to Form an Unexpected Partnership

By | Cloud Computing, ERP | One Comment

Oracle and Salesforce Partner

Larry_Ellison_on_stage

(Photo: Wikipedia)

In a call with analysts last Thursday, Oracle’s CEO Larry Ellison announced a planned close alliance with Salesorce.com. The agreement, to be detailed this week in a call, is to share data between Salesforce.com’s and Oracle’s could-based application.

This is quite a surprising reversal from just two years ago, when Ellison essentially declared Salesforce.com’s Marc Benioff a persona non grata and called off his keynote address at Oracle Open World conference at the last minute, perhaps in response to unflattering comments made by Benioff on Facebook. Benioff response at the time was “It’s free publicity, and it is clear that Oracle is threatened by us.” But the sentiment last week was very different: “Larry and I both agree we need to unite our clouds. Oracle is a very important part of our strategy” said Benioff.

Oracle just capped its 2013 fiscal year with two lackluster quarters, especially in the areas that the company was betting on: Cloud computing and big data analytics.

Cloud computing and cloud-based application delivery is yet to catch up with hype of industry analysts and some software vendors, and cloud related revenue at Oracle and others are growing but hardly as pace some analysts suggested.

In the last several years both Oracle and its archrival SAP – which also happens to its largest database reseller – spent much time and many advertising dollars arguing for technology superiority. SAP is pushing HANA – its in-memory database technology – threatening Oracle’s bread-and-butter relational database business. Oracle, on the other hand, is betting on Exadata: a data warehousing and analytics “appliance” running on the Sun hardware it had acquired in 2010, challenging IBM and SAP for speed face-off.

However, the lukewarm response of enterprise software buyers to the MIPS wars seems to indicate that they care less for speed and more for sustained business value of their IT systems. Oracle seems to finally acknowledge that the value is not as much in the appliances and database technology as much as in wealth of data obtained from a large ecosystem of networked people, systems and devices. This should not be too surprising. Back in the 90s Ellison often spoke about the value of the network, the time when Oracle became interested in NetSuite, which was also named a partner in this alliance.

The formation of the proposed alliance is similar to other ‘surround SAP’ strategy Oracle is so good at. This time, instead of buying a technology company to block SAP’s progress, Ellison is moving to influence the value creation ecosystem.

Another interesting alliance is going to be announced tomorrow (Monday).  Microsoft’s CEO Steve Ballmer, Windows & Tools President Satya Nadella, and Oracle’s co-president Mark Hurd will announce the availability of Oracle’s technology, perhaps Oracle’s upcoming 12C database technology, on Microsoft’s Windows Azure cloud.

Microsoft has been trying for years to make a dent in Oracle’s database dominance with not much success. Microsoft’s SQL Server is a very capable product, but most large companies have already committed to Oracle’s technology and have no reason nor appetite to evaluate Microsoft’s’ technology against that of Oracle’s. On the other hand, the popularity of the Microsoft technology stack, especially in smaller companies, will make it easier for Oracle to get a foothold in these companies and compete more effectively against tier two ERP companies such as Infor and IFS.

Microsoft also needs more tools and a broader ecosystem to fuel its Azure cloud infrastructure and be able to compete more aggressively against Amazon’s S3. Microsoft may then attempt, not for the first time, to create online marketplace and actively engage in ecommerce applications.

Perhaps next week calls will bring more information and clarify about the cloud partnerships between Oracle, Salesforce.com, NetSuite and Microsoft, but I think that the following points are fairly certain:

  • Oracle, Microsoft and Salesforce.com and their customers will certainly benefit from these alliances, as awkward as they may be initially.
  • On the other hand, the new partnerships will put much more pressure on SAP that must get off the HANA bandwagon as the only way to view and solve customer needs.  SAP should be able to demonstrate business value across its product portfolio and customer business processes. Still, I don’t expect the impact to be too dramatic within SAP’s installed base.
  • On the other hand, while SAP has a broad portfolio that can leverage cloud services, as do Oracle and Microsoft, these alliances and the new balance of power will likely threaten HP’s Converged Cloud business unit which is still trying to figure out its strategy.