Wednesday, February 3, 2010

Larry Ellison, Cloud Contrarian

We cloud believers should find it intellectually refreshing to confront a heretic. We find a famous one in “Larry Kills Sun's Cloud: A Sign or Spleen?" by Michael Neubarth in CIOzone(TM):

“After Larry Ellison’s public displays of ridicule and contempt towards cloud computing, it came as no surprise when Oracle, in its recent briefing event to disclose its plans for Sun’s technology, listed Sun’s Open Cloud initiative among the casualties.

“’We don't plan on being in the rent-by-minute computer business,’ Oracle chief corporate architect Edward Screven was widely quoted as saying.

“Meanwhile, it’s unclear whether cloud computing is a major disruption or an overhyped fad that will blow over. The predominant view of analysts is that the traditional software business of Oracle and other vendors, including IBM and Microsoft, is threatened by the cloud. Gartner recently made the bold prediction that 20% of all businesses would have no IT assets by 2012 because of movement to the cloud.”

Competing with Amazon and Google in the cloud certainly threatens profit margins. Yet unlike Oracle, other major vendors that have reason to be threatened are fielding cloud offerings and presenting themselves as pro-cloud—including IBM with Blue Cloud and Microsoft with Azure.

And the cloud isn’t the only threat to current industry practices. Here in the Boston region, Xconomy has taken a leadership role in cloud advocacy. Xconomy also organizes seminars on mobile computing, which certainly presents an even greater threat to traditional software pricing and delivery than does the cloud. If the triad of smart phones, the cloud, and virtual technology are truly IT's Perfect Storm, then Ellison’s yacht, however large, may well be sailing toward perilous conditions.

Although Oracle has announced the termination of Sun Open Cloud, the technology has already been developed, so it could simply be put on ice and, if the cloud does take off, be resurrected in the future says Neubarth.

“Was killing the Sun Cloud a savvy move on Oracle’s part, a deep reading of the market’s pulse by Ellison, or an act of spite, born of frustration? Will Larry be vindicated when Oracle conquers the data center, or will his animosity towards the cloud come back to bite Oracle?”

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