Oracle has made a significant change to its go-to-market strategy for Oracle Database Appliance engineered system in hopes of shoring up hardware sales and having broader appeal to smaller and medium-sized enterprises.
The newest ODA systems announced this week feature all-flash storage for improved I/O and database performance. They also come in a variety of sizes: small, medium and large, along with a high-availability dual node system geared for running database and application workloads in a single appliance.
Pricing starts at $18,000 for the small size, scaling up to $72,000 for HA versions.
Large-sized systems are being positioned as ideal for consolidating workloads from previous-generation Database Appliances, while the mid-tier configuration is aimed at customers who want faster performance for existing workloads.
It remains to be seen whether such aggressive pricing can have a major impact on Oracle's hardware business. Total hardware revenue—accounting for both product and support revenue—fell 12 percent year-over-year in Oracle's quarter ended Aug. 31.
Hardware options aside, the most eye-opening change for the new ODAs concerns database software licensing. For the first time since ODA's launch in 2011, customers will be able to use Standard Edition, Standard Edition 1 and Standard Edition 2 licenses with the appliance. Previously, ODA supported only Enterprise Edition. EE offers many more features than standard edition but also costs much more, and may be overkill for the needs of SMBs.
Oracle did ruffle some feathers last year when it introduced SE2 and took Standard and SE1 off the price list. Still, customers holding existing Standard and SE1 licenses should be able to apply them to ODA. As for new license deals, at $17,500 list price per processor license SE2 remains much less expensive than EE's $47,500 per processor price tage. (One caveat: the new high-availability version of ODA only supports EE.)
While the new options provide welcome flexibility for SMB customers, overall this is a wait-and-see situation for Oracle.
"$18,000 is a low starting point, indeed, and the flash performance and consolidation-oriented versions are doing for SMBs what previous Enterprise Edition only versions of the appliance did for larger companies," says Constellation Research VP and principal analyst Doug Henschen. "I still talk to companies that deploy on conventional servers, so Oracle has steadily moved downmarket with its engineered systems to try to capture every opportunity available. Unfortunately for hardware manufactures, the lion's share of the SMB deployment growth is in the cloud. You need only look at hardware sales stats to confirm that trend."
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