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For Larry Ellison's Oracle, the Cloud Beckons

The company will offer its database as a cloud service.

Asa Mathat

Business software giant Oracle kicks off its massive OpenWorld conference in San Francisco tonight with a keynote address by founder and newly named CTO Larry Ellison.

It will be Ellison’s first public appearance since a managerial shift announced earlier this month in which he ceded his CEO job to presidents Mark Hurd and Safra Catz, who now jointly share the title and have split operational responsibilities.

In an interview Friday, Hurd gave Re/code a short preview of what Ellison will be covering in his remarks. Expect to hear the word “cloud” a lot, but not in the way you’ve come to think of it.

Oracle, which sells large companies much of the software they use to run their businesses, has begun shifting its business toward selling software-as-a-service, or SaaS. That’s when companies buy software subscriptions and pay only for what they use. It’s an approach made popular by Salesforce.com and Workday, both Oracle rivals.

But Oracle will tonight make some moves toward a new cloud offering known as platform-as-a-service. Its Oracle database — the technology that underpins much of its software — will be offered as a cloud service. So will Java, the programming language it took ownership of when it acquired Sun Microsystems in 2010.

“If you look at the three pieces of the cloud — software, platform and infrastructure — we think Oracle is highly differentiated in the first two,” Hurd said.

Many Oracle customers, he said, spent as much as 30 percent of their time building their own internal software applications for their specific businesses. “And most of the time they have to buy a server and storage and all that just to get started,” he said.

A lot of those customers turn to Amazon Web Services and its cloud infrastructure for that work, he said. “When they do that, they have to work with a language and database systems they’re not familiar with, then they have to convert it to work with whatever systems they have in production. It’s a lot of extra work,” he said. Java and Oracle database are both pretty familiar to most programmers.

While many may see the move as intended to compete with Amazon’s cloud, the more accurate direct competitor, Hurd said, is Microsoft’s Azure. “As you’re developing an app, do you want to build it in .Net or do you want to be in Java? Do you want to use a SQL database or do you want to use Oracle?”

Oracle’s biggest strength in the cloud, he said, is its ability to offer its special sauce that others don’t have. Offering raw computing services in the cloud is one thing, he said. “The people I can think we will compete with are the ones who have intellectual property and can make those technologies work in the cloud, not the ones who offer commodity infrastructure-as-a-service” He won’t say it so I will — those commodity players he’s referring to include Amazon, IBM’s SoftLayer and Rackspace.

Hurd will be speaking in his own keynote Monday night and will focus on how several customers — he didn’t name them during the interview but said they’re “some of the world’s biggest brands” — are using Oracle’s technology.

The two speeches will effectively demonstrate the division of labor that has evolved at Oracle since Hurd joined the company in 2010 after leaving Hewlett-Packard, where he had been CEO. Ellison remains the technical visionary while Hurd and Catz will focus on the operational side of things: Closing deals and tending to matters both financial and legal. The arrangement essentially formalizes the working relationship, but represents little to no operational change.

About the change in titles itself, Hurd had little more to say beyond what Oracle said when it was announced. Asked what, if anything, will change at Oracle, he said,. “I don’t think it changes very much. Our strategy isn’t changing. Directionally we’re pushing as hard as we can and in the same way we were before. We’re not replacing Larry. He remains engaged and is highly engaged. We’re a team. The titles moved a bit, but it’s the same team. And we’re focused on winning.”

This article originally appeared on Recode.net.

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