At OpenWorld 2019, Larry Ellison announced Oracle Cloud Free Tier, which provides unlimited, free usage of two Oracle Autonomous Databases and additional services including two Oracle Cloud Infrastructure Compute VMs; Block, Object, and Archive Storage; Load Balancer and data egress; Monitoring and Notifications. Along with these “Always Free” tools, there is a 30-day trial and $300 credit for other Oracle Cloud Services.
The official press release can be found here.
Besides the buzz an announcement like this creates, the real impact of this offering depends upon the level of Cloud-maturity of each potential customer. For instance, how this affects a traditional Oracle-installed client not yet fully adopting Cloud technologies will be different than how it affects a company that has fully embraced and invested in large-scale Cloud development initiatives. Still different is the profile of a smaller company not yet using a large packaged software at all, but evaluating the cost effectiveness of a Cloud-serviced product.
To get an early reading on how this offering might play in the marketplace, I polled a few clients for their feedback. These are informed IT Directors who are just the kind of customer Oracle is marketing Cloud services to. Below are some of their takeaways.
Companies are beyond the security concerns which were a stumbling block to early Cloud adoption. A menu of Cloud-delivered products will be a part of most companies IT solutions moving forward. In some cases, Cloud products will fully replace incumbent platforms. More often - initially, at least - there will be a blend of Cloud, hosted and on-premise solutions. Nevertheless, Cloud is here to stay.
Oracle is playing catchup in the Cloud space as Microsoft and Amazon with their industry leading Azure and Amazon Web Services (AWS) products have set the standard in enterprise-grade Cloud platforms.
Oracle’s announcement will affect potential customers in different ways, depending upon each company’s current Cloud utilization and strategy.
For companies already committed to extensive AWS or Azure development, Ellison’s announcement may have little impact. Effectively, the train has left the station with such companies, and they likely are too invested in another platforms to move to Oracle as a result of this announcement.
For customers using packaged software, like Oracle’s ERP various systems (E-Business Suite, JD Edwards and PeopleSoft) or competitive enterprise tools like SAP which are considering Cloud adoption or expansion, Oracle’s Always Free offer probably causes them to stick a toe in the water and give Cloud a try.
Emerging companies considering their first enterprise tool should also find the Oracle offer worth evaluation giving an instant boost to Oracle Cloud marketing efforts.
In each of these scenarios, integration to other Oracle tools should be a competitive advantage for Oracle. After all, no matter how robust the Could solution, there usually is additional functionality each business needs. As always, the question then becomes whether such business processes can best be addressed and maintained with packaged software, custom development and/or whether the company really needs them at all.
Service levels for Cloud-based customers is an area most managers noted as a differentiator when evaluating Cloud providers. Simply put, many mid-size companies don’t feel they command enough attention from Microsoft and Amazon when support is required. This was cited as the principal reason that many industry-specific, boutique Cloud providers were able to carve out a piece of the market. It will be interesting to see how Oracle addresses this issue where “bigger isn’t always better”.
In related news, Oracle announced it is adding 2000 employees globally as part of their Cloud infrastructure team. This article further underscores Oracle’s financial investment in Cloud technology and the short and long term effects this may have on Oracle’s earnings.