Constellation Research's Frank Scavo has provided a robust rebuttal of Larry Ellison's Oracle Cloud presentation.
More on that Oracle Cloud presentation from earlier in the week and a splendidly robust scrutiny by long time Oracle watcher and Constellation Research principal analyst Frank Scavo which pretty much mirrors our own thoughts on the strategy update. Scavo asks a number of pertinent questions and raises some solid points.
- Oracle Exaggerates Its Cloud Apps Availability: A recurring meme of CEO Larry Elilson’s presentation was that are now 100 applications in the Cloud which Scavo finds difficult to reconcile. “Seeing that Oracle announced five during Open World, it's difficult to understand how it is now claiming 100, unless it is talking about very small pieces of functionality,” he argues. “Furthermore, not all of the capabilities that Oracle showed or referred to during the event are in general release…we'll have to wait for some public clarity from Oracle on what customers can buy today and what is still waiting for general availability.”
- Oracle's Developer Cloud Still in Controlled Availability: Scavo notes that Oracle Java Service and Database Service are not yet available via customer self-service and that when you try to sign up for Cloud services you are taken to a screen that says you “will be placed into a queue for access to controlled availability services. We will be provisioning Java and Database services in batches over the next several months. Our Fusion Application services will be made available shortly after that. You will be notified by email when your instance is ready.”
- Ellison is Rewriting History: During the strategy update Ellison boasted that Oracle began rebuilding for the Cloud six or seven years ago as part of the Fusion applications work. Scavo however recalls – as do many of us I suspect – that Fusion was never pitched as a Cloud project at the time but as scheme to create a next-generation successor to Siebel, PeopleSoft et al. “Oracle has not been working on cloud applications for seven years,” insists Scavo. “It has only been in the past year or two, as Salesforce.com and Workday began eating Oracle's lunch that Oracle responded with its own Cloud pronouncements…Ellison's early presentations indicated that Fusion would be a traditional sold-as-a-licence product, deployed on-premises, not a Cloud service. To now claim that Fusion was a 7-year Cloud development effort is simply not true.”
- Ellison's Characterisation of Competitors is Out-of-Bounds: No Ellison presentation would be complete without some rivals bashing and this week was no exception. Most notably he claimed that SAP would have nothing in the Cloud before 2020 and that all that the firm had done was acquire SuccessFactors. As Scavo notes, this conveniently ignores Business ByDesign which has somewhere around 1000 customers (compared to 200 for Oracle Fusion to date!). “Even by Oracle's own numbers, SAP has sold more Cloud customers with its own developed products,” states Scavo. “SAP may have its own problems in transitioning its business to the Cloud, but Ellison's mockery of SAP is simply unfair and inaccurate.”
- Oracle Exaggerates Adoption of Fusion Apps: Oracle claims just 200 sales of Oracle Fusion Apps with no breakdown of whether those are CRM or HCM or whatever. Scavo says he has reason to believe that most of those sales are for HCM and that there have been few new sales of Fusion CRM. He notes also the lack of live customers on stage to give testimonies of use.
- Oracle Customers Choose Cloud Because of Fusion Complexity: Scavo observes that nearly all Oracle Fusion application sales are for Cloud deployment, not on-premise, but contends that this is not because Fusion can only run in the Cloud, but because “Fusion technical requirements are so complex that virtually no organisation wants to deploy Fusion Apps on-premises. It is easier to simply turn over the infrastructure and application management activities to Oracle.