By: Neil Ward-Dutton, Research Director, MWD Advisors
Published: 11th October 2012
This work is licensed under a Creative Commons License
It’s been a very long while since I’ve been to a big Oracle customer conference, so I wasn’t really sure what to expect—beyond the ‘town within a city’ vibe that you so often get with these mega-conferences, with the attendant 100-long lines at every Starbucks in a five-block radius of the main conference centre.
So I was kind of surprised to see that the main thrust of Oracle OpenWorld remains an out-and-out infrastructure technology event aimed at architects, sysadmins, developers and DBAs; and for the most part, it makes little attempt to wrap that core up in ideas that play well with a broader audience. Whereas other mega platform vendors like IBM and SAP (and also companies like TIBCO, which are orders of magnitude smaller than Oracle) have made a shift to try and package what they sell so that it makes sense to senior business people in the context of the opportunities and pain points they see, in the main Oracle OpenWorld conference venues this was conspicuous (to me, anyway) by its absence. (Forrester’s Stefan Ried made this point well).
This observation isn’t just random snarkiness on my part. I think it’s important, because of something that I only came to realise properly—really properly—towards the end of the event. And although it might be obvious to you, it wasn’t to me, for a long time. (I’m dumb sometimes).
What I’ve come to realise is this. Oracle’s strategy hinges on one simple argument: investing in a complete integrated stack of Oracle technology (from server and storage hardware up through middleware to enterprise apps) will deliver you more value than investing in technology from a variety of suppliers. The more of the integrated Oracle stack you buy into, the greater the value to you. If this argument works for you, then as long as any given Oracle product is ‘just about good enough’ for your needs, that should be good enough for you and for Oracle; the incremental value you get from it being tightly integrated with everything else makes up for any ‘meh’ capabilities.
So Oracle’s strategy hinges on what is fundamentally an economic argument—an argument that CFOs, some COOs and some CIOs will get, but an argument that few tech practitioners care about in reality. So if Oracle OpenWorld’s big stage show is pitching technology to tech practitioners, is that the right tack to take? On one hand Oracle reps are taking the big stage dishing out benchmark stats and dissing the performance of competitors around individual products and technologies, and talking up the tech chops involved in putting the Oracle Public Cloud together; and on the other hand, what Oracle is really focused on making and selling doesn’t need all that bluff and bluster—it just needs people to buy the economic argument. (Interestingly, seen through this lens, the value of the Oracle Public Cloud is at least as much about demonstrating the power of the integrated Oracle stack, as it is about having a credible Public Cloud position).
What’s doubly interesting in this context is that as long as Oracle insists on continuing to trash-talk on technology tidbits, it opens itself to feature competition on almost countless fronts, from other vendors with different agendas and more nimble delivery.
You see, the ‘engineered systems’ thing is a self-imposed weight on top of Oracle’s platform, and it’s the delivery of the Fusion Apps portfolio on top of the platform that provides the heaviest weight. Building Fusion Apps (which let’s not forget are now designed to be delivered from a Public Cloud, Private Cloud or plain vanilla infrastructure platform, as you desire) in this way has forced Oracle to re-engineer a lot of the platform for increased scale, reliability, and so on. Even though the Oracle Fusion Middleware development team numbers in the multiple thousands, there’s no doubt it’s had to sacrifice features for –ilities.
But you know what? I’m pretty certain that’s no bad thing at all. Platforms should be rock-solid! Except that Oracle insists on keeping playing the same music—music which creates significant dischord against the backdrop of its underlying strategy. (Information Week/ Global CIO has an article here which I think supports this very nicely—incidentally also leveling the same accusation at SAP).
I do wonder, though, how many enterprises are today in a mode where they can afford to wait for Oracle to produce (or buy) its own technology alternative to that of the small, innovative players before investing. My worry is that Oracle already shows signs of starting to see the value of the integrated stack as the starting point for every conversation with customers and prospects; and if Oracle wants Fusion Middleware to be seen as a “business innovation platform” (as Amit Zavery pitched in his keynote) then this is going to potentially cause difficulties.
So let’s be constructive. What does Oracle need to do? I think it needs to be much more up-front and coherent with a story that works for senior executives within your organisation, and which is also honest regarding the company’s strategy.
I also think Oracle needs to be unafraid to tell this story on the big stage. When Oracle’s CEO tells the audience that he’s bored of showing customer stories and wants to get back to talking tech, to me that’s not funny; that’s really worrying.
This post is my observation from the first couple of days of Oracle OpenWorld 2012. The more encouraging story, from my point of view, was to be found in the ‘conference within a conference’, the Customer Experience Summit. But I’ll cover that in a separate post, to follow very soon—this one has gone on long enough…
I’d love to hear your views on this one. Are you an Oracle customer, partner or prospect? Am I way off track here?
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