For the week of May 31st, 2012:

• Oracle versus IBM: The Showdown of Big Red and Blue
• “SaaSy” Cloud Applications: Oracle’s Henway 2nd Hand

“IOUG Podcast 31-MAY-2012: Ellison Speaks”

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Oracle vs. IBM

Do you remember back in April 2009 when Larry Ellison shook up the technology world in April by outbidding IBM and snatching up then struggling server and software maker Sun Microsystems Inc. for 7.4 billion dollars? And then during OracleWorld 2009 when he promoted a 10-million dollar prize contest Oracle offered to any Fortune 1000 organization that found Oracle’s database software didn’t run at least twice as fast on Sun servers as it did on IBM’s fastest computers?

[ Read the original article at http://www.digitaltrends.com/computing/oracles-larry-ellison-to-ibm-make-our-day/#ixzz1wULlG1Gr ]

Directed towards IBM Ellison said “…you are more than welcome to enter. “If you’d like to take us on, make our day,” prompting laughs from the crowd of Oracle customers at the conference.

In that same presentation, Ellison also announced the emergence of Fusion Applications and Fusion Middleware and marked Oracle’s first foray into directly selling hardware along with its software.

As excerpted from an article by Agence France Presse on Wednesday this week at the All Things Digital conference in Southern California, Ellison reiterated that sentiment during an on-stage chat with Kara Swisher, technology columnist for the Wall Street Journal.  Ellison said, “Our biggest competitor is IBM. IBM was number one in databases. Now we are number one. And they were number one in middleware, now it’s us; they were number one in high-end servers, and we will be number one in high-end servers.” Ellison also said that Oracle was not a competitor to IBM in services, which has increasingly been a significant priority for the company.

According to figures released Wednesday by IDC, Oracle is currently ranked fourth in worldwide server market revenue, with its share of 6.1% of the market, behind the top-3: Hewlett-Packard (29.3%), IBM ( 27.3%) and Dell (15.6%). Ellison said, in response, that tracking market share was misleading since Oracle was sacrificing sales of entry-level systems to focus on more profitable high-end server systems where “(Oracle’s) margins are probably higher.” He explained that Oracle was emulating the model set by Apple in the consumer electronics market by providing fully integrated systems designed to be simple for users.

This challenge really is not new, noting that back in 2000 at the then-named OpenWorld conference, Ellison offered a 1-million dollar prize guarantee for any customer that, after moving to Oracle (products), did not see a 300% improvement in performance over their existing architecture. His claim was that the company’s 8i database and Internet Application Server software would run Web sites three times faster than rival offerings from BEA Systems  Then 8 years later, after no one had claimed the prize, he bought BEA for 8.5 billion dollars.

With Big Red’s recent emphasis on Exadata, Exalogic, and Exa-machines, and a renewed focus on building out verticals for WebCenter, it’s clear that Oracle has set its sights on outright domination the application and content delivery markets.

With history as our lesson plan, when Ellison set his sights on winning the America’s Cup yacht race back in 2003 it took him only 7 years and a strategic alliance with BMW to come out on top in the 2010 race.

Ellison was born in the Bronx and grew up in South Shore, Chicago with his adoptive aunt and uncle. He has survived childhood pneumonia and countless mergers, acquisitions, and dissolutions in both his financial and private lives.  He is clearly a survivor personality on many accounts.

When Sybase became Microsoft SQL Server and Informix was absorbed into IBM’s framework under DB2, Oracle concentrated on filling the gaps in functionality that the competition’s products didn’t offer. The industry has long noted that one of the underlying reasons for DB2’s dominance of the market share numbers comes from IBM’s bundling of the software with its hardware. Microsoft’s market share was built on cost efficiencies for stand-alone deployments and individual application builds. Oracle appears to be addressing both of those markets with different product strategies all based on its own technology.

“SaaSy” Cloud Applications

There are several poker variants that employ multiple-hand betting, and Oracle seems to be no stranger to this game. At the very same  All Things Digital conference, Ellison also announced the launch of a new suite of cloud-based software products and computing services coming next month.  This is commonly being referred to as a re-branding of the Oracle On-Demand hosted services branch of Oracle, with a renewed emphasis on running the increasingly complex Fusion Applications Suite of products.  With the challenge of in-house hosting of the combined technology Suite, which includes SOA Suite, WebCenter Portal, OBIEE, Identity and Access Management, GoldenGate, Fusion BI and WebLogic Server comes an understandably natural need for providing a pre-integrated and configured version of the collection of products available on a pay-as-you-use basis. At the current stage of development, one of the faults of this cloud-based Software As A Service solution is that it is not completely addressing the needs of the global enterprise in a number of key financial areas, presenting a significant challenge to early adopters of the Fusion-in-a-cloud offering. The other financially-significant barrier is in the non-module based licensing required for adopting the cloud-version of Fusion Apps.  With most eBusiness Suite customers being accustomed to a “pay for a module as you use it” basis, there are numerous indirect related-module fees associated with the transition to the Cloud’s all-inclusive licensing model.

Oracle’s latest strategic directions indicate that these are the next two markets in its sights. IOUG’s forthcoming educational focus for the coming months and our commitment to providing the best technology networking framework will continue to ensure that you as an IOUG member will have direct and cost-effective access to all of the technology education you’ll need to navigate these increasingly turgid waters.  Visit IOUG’s website for all the details about membership and alliance with your source for Independent technology education the IOUG.