Tag Archives: Oracle

Oracle Cloud Moves are an Aggressive Play in Late Innings

What is Happening?

On Monday June 22 – on the heels of its latest quarterly financial reports indicating small-but-fast-growing Cloud-related revenues – Oracle announced expansion of the Oracle Cloud Platform, basically outlining its rapid and extensive shift toward enterprise Cloud-first IT.

Oracle’s Cloud services are broad, and include SaaS, PaaS, and IaaS. The most notable new services are for database, storage, integration, and mobility. And company leader Larry Ellison put the competition on notice, saying, “Oracle is the only company on the planet that can deliver a complete, integrated, standards-based suite of services at every layer of the Cloud. Those technology advantages enable us to be much more cost-effective than our competitors.”

Saugatuck’s position is:

  1. Oracle has a broad and deep portfolio of Cloud and Cloud-enabled offerings, yet it faces more significant competition than it seems to be acknowledging.
  2. Oracle has a huge installed base to sell into, but having a broad portfolio is not necessarily going to drive Cloud sales fast enough to counter the established and growing power of Cloud-first Master Brands like Amazon, or the re-emergent, traditional-to-Cloud Master Brands like Microsoft.
  3. Oracle knows this, and is turning into a “Cloud-aggressive” enterprise IT provider as a result.

Continue reading Oracle Cloud Moves are an Aggressive Play in Late Innings

Oracle Financials – Tougher Than You Think

Oracle Corp. (ORCL) issued its quarterly and fiscal year-end financial report this week, and the blogosphere is abuzz with quotes, assertions, and counter-arguments regarding the company’s future and viability. On the one side, we have company leadership asserting that all is well, and that the notable decline in traditional software, hardware, and services business will be more than offset by the continued increase in Cloud-based business. On the other side, we have pundits proclaiming the beginning of the end for Oracle.

Here’s what Saugatuck sees: A very traditional, old-style IT Master Brand in the throes of re-inventing itself, and suffering financially as a result (just like all other traditional IT Master Brands). That doesn’t mean that Oracle is failing, or will fail, just that it, like HP, IBM, and other traditional old-line MBs, is suffering as their businesses and traditional customers and partners turn, almost groaningly slowly, toward Cloud-first approaches.

A radar-style chart helps to show not only how slowly this is happening, but how tough it is to accomplish. Figure 1 uses data aggregated from Oracle’s SEC filings in 2013 and 2015 to illustrate. I combined Oracle’s reported “New Software License” revenue and its “Software License Updates and Product Support” revenue into the “Traditional Software Business” category in Figure 1. Oracle’s reported “Cloud Software as a Service and Platform as a Service” is combined with its “Cloud Infrastructure as a Service” revenues to create “Cloud-based business” in Figure 1. “Traditional Hardware Business” includes the company’s reported “Hardware Systems products” and “Hardware Systems Support” revenues. “Traditional Services Business” in Figure 1 is simply Oracle’s reported “Services Revenues.”

Figure 1: Oracle Revenue Shifts (Almost Imperceptibly) Toward Cloud, 2013-2015


Source: Saugatuck Technology Inc.; figures are in millions of US $

See the little bit of pink/red to the left of center? That’s how much / how little Oracle’s Cloud-based revenue has grown in two years. Continue reading Oracle Financials – Tougher Than You Think

Oracle Rides the Marketing Services Wave

One of the most entertaining and enlightening discussion sessions (among many) at this year’s Cloud Business Summit concerned the increasing role, involvement, and influence on enterprise marketing organizations and operations on enterprise Cloud business strategy, Cloud services acquisition, and overall IT spending and management.

Bottom line: Marketing, along with Finance and the IT organization, is one of the most powerful influences on the direction, cost, and use of IT – especially Cloud-based IT, given the reach and power of Cloud-based interaction, data gathering, processing, and analytics.

I bring this up because Oracle, one of the most careful and steady of traditional IT Master Brands, has just agreed to acquire Cloud-based marketing software and services provider Responsys Inc. for about $1.5 billion. The acquisition will not only Continue reading Oracle Rides the Marketing Services Wave

Research Alert: Cloud, Mobile, Social, Analytics – Greater Than the Sum of Its Parts

What is Happening? 

There is little doubt that the technologies and capabilities of Cloud, Mobility, Social IT and Advanced Analytics (CMSA) promise great value to user enterprises. Few enterprises of any type or size are not actively pursuing each.

And according to the latest research from Saugatuck, enterprise executives expect significant competitive value from each as well. In our Q1 global Cloud IT survey this year, we asked participants to “please indicate how important each of the following technologies are to your company’s competitiveness over the next 24 months.” Figure 1 aggregates the percentages of survey responses ranking each as “Very Important” or “Extremely Important” – rankings that have, over the years, been reliable indicators of imminent investment.

Figure 1: Ranking CMSA Competitive Value

Cloud Mobile Social and Analytics for Business Value

Source: Saugatuck Technology Inc., 1Q2013 global web survey; n = 218

CMSA is truly a simultaneously evolving set of services and capabilities, helping to change enterprise IT from a monolithic entity into sets of loosely-coupled, complementary services.

But as much value as each of these provides (or is expected to provide), even greater value is seen from combining them with each other, and with business management applications software and processes in key enterprise systems. Figure 2 summarizes our survey data regarding how business and IT leaders see combinations of Mobile, Social and Advanced Analytics with enterprise business systems as adding the greatest business value to the enterprise. The higher the percentage, the more survey participants see business value.

Figure 2: The Integrated Value of CMSA with Enterprise Business Systems

The Value of Mobile, Social, and Analytics on Business Apps

Source: Saugatuck Technology Inc., 1Q2013 global web survey; n = 218

Clearly, Cloud-based Mobile, Social, and Advanced Analytics are seen as relatively less beneficial to business when used individually (in most cases) than when used in combination with each other, and as part of enterprise business systems. In short, while Mobility, Social IT and Advanced Analytics each have intrinsic value, that value is typically multiplied with coordinated use.

Why is it Happening? 

With past IT architectures, single or serial evolutionary trends tended to define the evolution, and IT became more and more focused on (obsessed with?) tightly-integrated technologies and systems. This grew through the almost manic progression of 1990s-era distributed and client-server architectures, which brought increased scrutiny on IT costs, resulting in edicts to standardize and integrate, which in turn led to a renewed emphasis on tightly-coupled architectures and technologies.

What makes the combination of CMSA different is that buyers, users, and increasingly some IT leaders are starting to see the potential value and utility of systems, technologies, and business operations that are only loosely-coupled and not tightly integrated. Integration is readily available and reasonably affordable in the form of Cloud-delivered services that alleviate many requirements for tightly-coupled technologies and systems. Cloud Integration services also expand the choice for building out certain capabilities beyond the traditional vendors of complicated, pre-built solutions and heavy customization, toward building a functional alternative from a variety of better suited products from different vendors without the tight coupling at their core.

The high value of Analytics, both alone and when combined with other capabilities and systems, is easy to understand, as the ability to better analyze and then utilize business data has long been a goal of IT and business leaders. In short Analytics almost intrinsically adds value everywhere. Mobility enables greater reach and utility of most business systems; and Social IT enables improved collaboration, which in turn adds value by improving group and resource communication and coordination. And with Cloud, they can often be added, used, and removed as needed –an additional value from the inherent flexibility of loosely-coupled, Cloud-based services.

Finally, more CMSA offerings are being architected with multiple, often open, standards-based interfaces that enable them to work with a wider array of business systems and data. They are enabling Mobile, Social and Analytics capabilities that recently cost significant amounts of additional money when included with traditional software (and didn’t always work as well as needed or expected). Buyers have wanted some combinations of these capabilities for years; making them available cheaply via Cloud has accelerated and expanded their adoption and use.

Market Impact 

By YE 2017, the inclusion of Cloud-based Mobile, Social and Analytics capabilities will be considered de rigueur and required by the majority of IT buyers and users. SaaS and BPaaS provider understand this, and are scrambling to engineer, integrate or embed an increasing range of such capabilities with their offerings.

Most will utilize capabilities from such providers as Dell Boomi, IBM CastIron, Informatica, MuleSoft, Pentaho, etc. These and other Cloud-based integration-as-a-service platform providers (“iPaaS”) are already, rapidly, pursuing BPaaS, SaaS, and other PaaS providers to embed a wide range of integration capabilities into business process services and solutions. So we believe that the loosely-coupled advantages of CMSA will only continue to grow. There will be no shortage of established and upstart providers serving enterprises and Cloud-based business solution providers alike.

Large-scale business management solution providers (e.g., Microsoft, Oracle, SAP) will be pressured to add more data and workflow integration capabilities and APIs to their core Cloud platforms; their traditional preferences for in-house “standards” will decrease as more buyers and users come to accept, then expect, the loosely-coupled IT and business reality of the Boundary-free Enterprise™.

This loosely-coupled future also helps to bring clarity and certainty to the roles of traditional SIs and enterprise IT departments. The proliferation of services and providers will mean increased roles, and increased need for skills, as enterprise users force the growth of a variety of hybridized IT and business environments, utilizing a changing array of Cloud-based offerings that need to work with other Cloud-based and on-premises systems. There will be new, different, and more skills required, and roles will continue to adapt, but there will be no shortage of need for skilled and experienced IT professionals in a world replete with ever-changing, dynamically-utilized IT.

More detailed analysis of this and much more data from Saugatuck’s 2013 Cloud IT survey will be published for Saugatuck CRS clients beginning the last week of June, including a series of research analyses and data reports.

Adaptive Planning on the Move

This week, I head out to San Francisco for the SIIA’s annual All About the Cloud (AATC) conference, where I will deliver a featured presentation on Day 1 of the event, and participate in the closing analyst panel on Day 2 – and where we have a schedule of more than 15 client meetings lined up.

But before I go, I wanted to share highlights from a terrific briefing that we had last week with Adaptive Planning who is clearly in break-out growth mode. Not only is the firm growing at a 80 percent plus annualized clip (up from 50 percent in 2011), while remaining cash-flow positive, they have plenty of powder still dry from their early 2012 venture financing led by Norwest Venture Partners – with about $20 million of the $22 million still in the bank.

The firm is broadening its initial value-prop focus on budgeting, planning and forecasting to now include financial consolidations – which both enlarges the “bag” for their direct sales force and partners (a “land-and-expand strategy”), while bringing it upmarket to new corporate and business-unit buyers at larger enterprises. While I think that they have some work to do on their messaging and go-to-market approach in this new segment, this should be a solid home run for them as it begins a more than subtle repositioning of the company (and which may require a firm-wide re-branding).

Adaptive Planning has succeeded in growing its international business, which represents more than 15 percent of its 1,600 customers (2,000+ projected for YE2013), suggesting that their significant channel-driven strategy (400+ global partners – NetSuite among them) is working. We were also a little bit surprised by the company’s positioning (or maybe it’s a slight repositioning) to add emphasis on its large-enterprise customers, when we had historically thought of Adaptive Planning as more targeting mid-sized companies (and ceding much of the LE market to Host Analytics and Oracle Hyperion, among others). But when prompted, Greg Schneider, VP of Marketing, shared that 25 percent of their customers are now large enterprises, or divisions thereof.

The net is that this is clearly a company on the move. While they were very tight-lipped in the call, Saugatuck speculates that they are poised to hit the $50M-$75M revenue sweet spot for an IPO filing over the next 18-24 months, which could be accelerated with additional synergistic acquisitions that either bolster its existing market positioning, or take it to new buying segments.

NOTE: This blog post has been updated to reflect more accurate information.

Research Alert: IBM, OpenStack, Nimbula, Oracle: Less About Private Clouds, More About Management

What is Happening?

Announcements within the past two weeks by IBM and Oracle have been touted as helping to promote the use of private Clouds. Saugatuck believes that they may actually help to limit the attractiveness of private Clouds, while driving more and better management of the fast-growing hybridized Cloud-plus-on-premises IT environment.

Last week, IBM announced that it will be joining the OpenStack Foundation as a platinum-level sponsor, joining a panoply of traditional and pure-play Cloud IT brands that includes AT&T, Canonical, HP, Nebula, Rackspace, Red Hat and SUSE. As part of the announcement, IBM also announced that all of its Cloud services and software will be based on the Open Cloud Reference Architecture. Continue reading Research Alert: IBM, OpenStack, Nimbula, Oracle: Less About Private Clouds, More About Management

Announcing the Oracle Cloud – Position, Strategy and Impact

What is Happening?

On June 6, 2012, Oracle CEO Larry Ellison announced as part of the company’s Executive Strategy Update that Oracle now has a comprehensive portfolio of enterprise business software development, delivery, and management offerings, available now either for the Cloud or for on-premises deployment. Oracle began developing the Cloud business solutions seven years ago. Today they are live.

Saugatuck sees seven key aspects of the Oracle Cloud as follows:

  1. A complete, end-to-end suite of 100+ apps, using modern tools like HTML5 for mobile client access
  2. Socially-enabled tools for collaboration and analysis Continue reading Announcing the Oracle Cloud – Position, Strategy and Impact

Oracle v. Google: What Will Happen to My Mobility Strategy?

I’ve fielded a handful of questions from clients and media recently regarding what Saugatuck believes will be the outcome and effects of the Oracle lawsuit against Google regarding the use of Java intellectual property within the Android operating system. More calls have come in now that the jury has found that Google “infringed” to some extent, without agreeing on whether or not Google’s use of Java was within legally-protected “fair use” guidelines.

In short, everything Android is up in the air, and some enterprise IT and mobility managers are concerned about what effects this court case may have on their abilities to plan and manage Cloud+mobility in the coming months, along with what to do – if anything. Continue reading Oracle v. Google: What Will Happen to My Mobility Strategy?