Microsoft, Oracle Partner to Challenge AWS in the Public Cloud
Microsoft and Oracle, longtime enterprise software rivals, are teaming up in the cloud to expand the services they can offer enterprises and to bolster their positions in a cloud services market dominated by Amazon Web Services.
Officials with both companies on Wednesday announced an alliance that will enable customers of each to migrate and run their mission-critical workloads on the others’ cloud environments. Through the partnership, enterprises running such Microsoft Azure services like Analytics and AI can connect them to Oracle Cloud services, including Autonomous Database. The goal is to create a single place for companies that want to leverage cloud services and applications for their businesses.
Scott Guthrie, executive vice president of Microsoft’s Cloud and AI (Artificial Intelligence) division, noted that more than 95% of Fortune 500 companies use Azure, and that “with Oracle’s enterprise expertise, this alliance is a natural choice for us as we help our joint customers accelerate the migration of enterprise applications and databases to the public cloud.”
The partnership comes at a time when enterprises are moving more workloads and data into the public cloud and are adopting strategies in which they are using more than one public cloud service provider. Gartner analysts are forecasting that the global public cloud services market will grow from approximately $182 billion in 2018 to more than $214 billion this year, a jump of almost 18%.. In addition, according to Flexera’s RightScale cloud report, 84% of enterprise have a multicloud strategy.
In this fast-growing market that is quickly evolving, AWS continues to be the dominant player with more than 35% share, followed by Azure, Google Cloud and IBM Cloud, according to Synergy Research Group analysts. Oracle, which was famously late to the cloud and has been working to catch up, is seen as a strong niche provider, according to the analysts.
The Azure-Oracle Cloud alliance is designed to close the gap with AWS, according to Paul Teich, principal analyst with Liftr Cloud Insights.
“The reason both of these clouds are talking to them is that AWS has active high-profile programs in place to win customers from both,” Teich told Channel Futures. “This is clearly an ‘enemy of my enemy is my friend’ situation. Microsoft and Oracle are looking at their alliance as a force multiplier against a common, much larger foe.”
There are multiple drivers behind the partnership. Enterprises can run their Oracle software in the Oracle Cloud Infrastructure (OCI) Gen 2 and Microsoft software in Azure, Teich said. Microsoft needed to have SLA assurance for its customers, “so look at this as Microsoft’s tacit approval of OCI Gen 2’s ability to deliver enterprise apps with enterprise SLAs and support. I think that Oracle hopes customers will get used to using Oracle apps in place on OCI, and as customers get comfortable with OCI then they’ll push more apps into OCI in the long run.”
The deal also means more Azure visibility among Oracle’s database customer base, particularly at a time when database options are growing, the analyst said.
“If Microsoft can leverage Oracle to focus enterprise customers on enterprise-class database solutions and divert the discussion from shiny new open-source alternatives, it will also help Microsoft’s database products,” Teich said.
The deal gives Oracle customers a much-needed option when it comes to the cloud, says Patrick Moorhead, principal analyst with Moor Insights and Strategy.
“Oracle gets to reduce a fair customer objection that its infrastructure was expensive, didn’t scale wide enough and couldn’t keep up technologically,” Moorhead told Channel Futures. “Customers who bought into Oracle apps or database can run their apps on Azure. Microsoft now gets customer access to Oracle database and applications customers who want to scale to the public cloud.”
Given that “Azure is by far the more powerful player in the cloud, this potentially allows Oracle to …