Earlier this week Oracle unveiled the Oracle Cloud Machine, its offering to run on premises what is running in the Oracle Cloud. It’s a key milestone for Oracle and for the overall industry, showing that hybrid cloud is real, and enterprises plan, want and likely will move loads between public cloud and on premises.

 
 

So let’s do our customary news analysis of the press release, that can be found here:
Oracle today launched a new family of offerings designed to enable organizations to easily move to the cloud and remove some of the biggest obstacles to cloud adoption. These first-of-a-kind services provide CIOs with new choices in where they deploy their enterprise software and a natural path to easily move business critical applications from on-premises to the cloud.
MyPOV – Interesting that Oracle approaches it as a strategy / platform to move to the public cloud. Moving load back from public cloud to on premises is what is the more immediate value proposition that comes to (my) mind. 

While organizations are eager to move their enterprise workloads to the public cloud, many have been constrained by business, legislative and regulatory requirements that have prevented them from being able to adopt the technology. Today, Oracle is making it easier for organizations in every industry to make this transition and finally reap the performance, cost and innovation benefits of Oracle Public Cloud Services and run them wherever they want—in the Oracle Cloud or in their own datacenter.
MyPOV – Oracle touches a key point with restrictions that keep enterprises from moving to public cloud. Giving customer choice is always good and that’s what Oracle customers are now getting.
 
"We are committed to helping our customers move to the cloud to help speed their innovation, fuel their business growth, and drive business transformation,” said Thomas Kurian, president, Oracle. “Today’s news is unprecedented. We announced a number of new cloud services and we are now the first public cloud vendor to offer organizations the ultimate in choice on where and how they want to run their Oracle Cloud.”
MyPOV – Good quote from Kurian, certainly Oracle is the first provider to run Oracle Cloud loads on Oracle Cloud Machine on premises. Who else would? Back in January Microsoft made the Azure Stack available that offers the same qualities. Going forward I am sure Microsoft and Oracle will spar with each other over who can move more load(s) and better.
 
Unveiled today, Oracle Cloud at Customer enables organizations to get all of the benefits of Oracle’s cloud services—agility, simplicity, performance, elastic scaling, and subscription pricing—in their datacenter. This is the first offering from a major public cloud vendor that delivers a stack that is 100 percent compatible with the Oracle Cloud but available on-premises. Since the software is seamless with the Oracle Cloud, customers can use it for a number of use cases, including disaster recovery, elastic bursting, dev/test, lift-and-shift workload migration, and a single API and scripting toolkit for DevOps. Additionally, as a fully managed Oracle offering, customers get the same experience and the latest innovations and benefits using it in their datacenter as in the Oracle Cloud.
MyPOV – Good description of the main argument Oracle has been using since many years now: Same platform and software for both sides of the firewall and the benefit of load fluctuation between public cloud and on premises.
 
By extending the Oracle Cloud into their data center, customers can:
Have full control over their data and meet all data sovereignty and data residency requirements that mandate customer data remain within a company’s data center or contained within a geographic location while still taking advantage of the benefits of the cloud
MyPOV – Control over data / privacy / compliance are key arguments for enterprises to keep loads on premises. Given the limbo enterprises are in with the invalidation of the safe harbor agreement, a very valuable offering for many of them.
 
Enable workload portability between on-premises and cloud using identical environments, toolsets, and APIs 
MyPOV – The main Oracle quality, Oracle showed the move of a database between on premises and the cloud back at Oracle OpenWorld last year. The question is how much dynamic load the enterprises will let float.
   
Easily move Oracle and non-Oracle workloads between on-premises and the cloud based on their changing business requirements
MyPOV – The interesting information bit here is ‘non Oracle workloads’ which is the strategy Oracle unveiled earlier in January this year (read here) and OpenWorld last year: With the help of a nested hypervisor infrastructure Oracle wants to attract, run and operate also non Oracle loads. Technically, an enterprise should be able to take e.g. an AWS Cloud load and take in on premises on Oracle Cloud Machine.
   
Comply with security and privacy regulations such as PCI-DSS for the global credit and debit card industry, HIPAA for the US healthcare industry, FedRAMP for the US federal government, Germany’s Federal Data Protection Act, the United Kingdom's Data Protection Act, and other industry- and country-specific regulations
MyPOV – Good to see Oracle has done the homework on all the data privacy and residency mandates that enterprises face – and we know enterprises struggle to stay on top of them. They sure are open for solutions that give them flexibility in regards to where the legislative bodies of their respective countries will march.
 
Today, Oracle is announcing the availability of the following Oracle Cloud at Customer services:
Infrastructure: Provides elastic compute, elastic block storage, virtual networking, file storage, messaging, and identity management to enable portability of Oracle and non-Oracle workloads into the cloud. Additional IaaS services that complete the portfolio, including Containers and Elastic Load Balancer will be available soon.
MyPOV – Good enough to see a sizable enough functionality to really run some load on premises. The Load Balancer will be key, container support will be important to move next generation applications to on premises, as they take advantage of modern software construction and operation technologies like microservices.
 
Data Management: Enables customers to use the number one database to manage data infrastructure in the cloud with the Oracle Database Cloud. The initial set of Database Cloud Service offerings will be followed by Oracle Database Exadata Cloud for extreme performance and a broad set of Big Data Cloud services, including Big Data Discovery, Big Data Preparation, Hadoop, and Big Data SQL.
MyPOV – The list of future offerings is long, reminding us that this is a version 1. But the most common Oracle load, its database is supported and with that there is massive market potential for Oracle Cloud Machine.
 
Application Development: Develop and deploy Java applications in the cloud using Oracle Java Cloud, soon to be followed by other services for polyglot development in Java SE, Node.Js, Ruby, and PHP.
MyPOV – This is likely the most interesting part of Oracle Cloud Machine from a PaaS perspective. It’s practically impossible to develop on premises and use the latest development tools and technologies. This is a first option to take the location of development back inhouse, which a number of organizations will welcome.
 
Enterprise Integration: Simplify integration of on-premises applications to cloud applications and cloud application to cloud application integration using the Oracle Integration Cloud Service. Additional capabilities for SOA, API Management, and IoT will be added soon.
MyPOV – While AppDev was interesting, this is the most impactful capability, as Oracle moves the boundary of integration between the firewall on premises and public cloud based systems to inside the firewall. And with that is open to control and inspection completely in the realm of the enterprise. Something most enterprise IT shops have done for many decades and in many countries are more comfortable to keep doing, then having the interface happening before / after data passes the firewall.
 
Management: Unifies the experience of managing workloads seamlessly on-premises and in the Oracle Cloud.
MyPOV – Ok – no brainer, needed to be there, more details on how to move load would be interesting. When could load ‘burst’ to the cloud, one of the ‘holy grails’ of cloud computing, could data be split based on statutory requirements etc. many more questions.
 
The Oracle Cloud has shown strong adoption, supporting 70+ million users and more than 34 billion transactions each day. It runs in 19 data centers around the world.
MyPOV – Impressive stats, a fortune for how many servers run Oracle on premises, how many users do they serve and how many transactions do they run. I am sure some smart people in Redwood Shores have assessed this…

 

MyPOV

Not a surprising move by Oracle, as it has been talking on symmetrical setup, products and capabilities between its cloud and on premise products since many years. That Oracle makes the move only now (and recently Microsoft, too) shows that Oracle thinks it cloud architecture is so mature, that it can ship it out to customers. At the same time it is clear that customers cannot replicate the full extend (and complexity) of Oracle’s Cloud platform across multiple servers and system landscapes – so offering the same on premises is the logical consequence. No surprise Oracle will have to offer the management of the Oracle Cloud Machines, something CxOs should definitively consider using as a service.

For enterprises it comes back to : Is the ability to run loads that may move to the (Oracle) cloud sometime in the future worth buying Oracle Cloud Machine and services today – versus using existing setups in machines and people. Every enterprise will have a different answer to the equation. 
 
But with many enterprise boards looking at the Capex vs Opex ration, CIOs and CTOs know they need to have more Opex options, so we expect some reasonable interest from the enterprise side. If Oracle now can show TCO superiority (something the vendor usually isn’t shy on) to other, also cloud based solutions, Oracle Cloud machine maybe the on premise route for Oracle to ‘steal’ load from other IaaS providers (thanks to the nested hypervisor). 

But speculation, certainly exciting times ahead, we will be watching, stay tuned.

 
Recent blog posts on Oracle:
  • Progress Report - Oracle Cloud - More ready than ever, now needs adoption - read here
  • Event Report - Oracle Openworld 2015 - Top 3 Takeaways, Top 3 Positives & Concerns - read here
  • News Analysis - Quick Take on all 22 press releases of Oracle OpenWorld Day #1 - #3 - read here
  • First Take - Oracle OpenWorld - Day 1 Keynote - Top 3 Takeaways - read here
  • Event Preview - Oracle Openworld - watch here

Future of Work / HCM / SaaS research:
  • Event Report - Oracle HCM World - Full Steam ahead, a Learning surprise and potential growth challenges - read here
  • First Take - Oracle HCM World Day #1 Keynote - off to a good start - read here
  • Progress Report - Oracle HCM gathers momentum - now it needs to build on that - read here
  • Oracle pushes modern HR - there is more than technology - read here. (Takeaways from the recent HCMWorld conference).
  • Why Applications Unlimited is good a good strategy for Oracle customers and Oracle - read here.

Also worth a look for the full picture
  • Event Report - Oracle PaaS Event - 6 PaaS Services become available, many more announced - read here
  • Progress Report - Oracle Cloud makes progress - but key work remains in the cellar - read here
  • News Analysis - Oracle discovers the power of the two socket server - or: A pivot that wasn't one - TCO still rules - read here
  • Market Move - Oracle buys Datalogix - moves more into DaaS - read here
  • Event Report - Oracle Openworld - Oracle's vision and remaining work become clear - they are both big - read here
  • Constellation Research Video Takeaways of Oracle Openworld 2014 - watch here
  • Is it all coming together for Oracle in 2014? Read here. 
  • From the fences - Oracle AR Meeting takeaways - read here (this was the last analyst meeting in spring 2013)
  • Takeaways from Oracle CloudWorld LA - read here (this was one of the first cloud world events overall, in January 2013)

And if you want to read more of my findings on Oracle technology - I suggest:
  • Progress Report - Good cloud progress at Oracle and a two step program - read here.
  • Oracle integrates products to create its Foundation for Cloud Applications - read here.
  • Java grows up to the enterprise - read here.
  • 1st take - Oracle in memory option for its database - very organic - read here.
  • Oracle 12c makes the database elastic - read here.
  • How the cloud can make the unlikeliest bedfellows - read here.
  • Act I - Oracle and Microsoft partner for the cloud - read here.
  • Act II - The cloud changes everything - Oracle and Salesforce.com - read here.
  • Act III - The cloud changes everything - Oracle and Netsuite with a touch of Deloitte - read here. 

Finally find more coverage on the Constellation Research website here and checkout my magazine on Flipboard and my YouTube channel here.
2012, 2013, 2014, 2015 & 2016 (C) Holger Mueller - All Rights Reserved

Business Research Themes

Future of Work, Tech Optimization

Roles

Chief Information Officer

Tags

cloud, hybrid cloud, iaas, nextgen apps, nextgenapps, oracle, platform as a service, saas