Oracle unveils suite of cloud services

Business software maker Oracle is after all adapting to a shift in computing that was threatening to turn the company into relic.

The 35-year-old company hailed its technological transition late Wednesday at its California headquarters, where hyperbolic CEO Larry Ellison announced plans to distribute more than 100 business software applications over the internet instead of selling them as products that have to be installed on individual office computers.

The concept of leasing software applications reachable on any internet-connected device is one of the services known as "cloud computing." It's an idea that Ellison has frequently mocked as a passing fancy, however his comments Wednesday made it clear that he realised some time ago that the trend had become a serious business. Ellison has nevertheless invested in both Salesforce.com - the trailblazer of software-as-a-service companies, and Netsuite.

Ellison said it took thousands of Oracle engineers the past seven years to rebuild all of the company's applications as a suite of cloud computing services. The work was code-named "Fusion," however Ellison acknowledged it became so disjointed that he understood why it was skewered as "Project Confusion."

The manpower

Despite all the manpower and money that Oracle poured into its cloud computing expansion, the company however couldn't build everything spontaneously. To fill the gaps, Oracle has spent more than $US3.5 billion buying some of the early pioneers in cloud computing, including RightNow Technologies and Taleo.

All boasting aside, Oracle will have to prove that it can adjust to the changes triggered by cloud computing. All this while for all that trying to profit from the old model of installing and maintaining software on the premises of its corporate and government clients.

Ellison acknowledged it won't be easy, saying "very few research companies cross the chasm from one generation to the at once."

Oracle is in no danger of fading away anytime before long. The company remains of the of the world's most successful software makers, with annual revenue of about $US37 billion and a market value of $US137 billion.

The 67-year-old Ellison

But the 67-year-old Ellison, an elder statesman among Silicon Valley's CEOs, doesn't want to risk becoming obsolescent. He is trying to stay a step ahead of longtime rival SAP as it as well embraces cloud computing during Oracle tries to catch up to one of Ellison's former proteges, Marc Benioff, who is now CEO of Salesforce.com. Not long afterwards leaving Oracle to start Salesforce, Benioff emerged as cloud computing's more persuasive evangelist. The two have taken their rivalry public in the past.

Salesforce.com is expected to generate $US3 billion in annual revenue this year and has a market value of $US19 billion.

Collision course with an old antagonist

Oracle's expansion into cloud computing as well puts Ellison on a collision course with an old antagonist, software entrepreneur David Duffield. Ellison bought Duffield's former company, PeopleSoft, for $US11.1 billion in 2005 afterwards a bitter takeover battle that lasted 18 months. Duffield has since started a cloud-computing service called Workday that sells human resources management tools.

Ellison predicted Oracle in the long run will trump Salesforce and Workday by offering a wider and more secure range of services that will fulfill all the cloud computing needs of big companies and government agencies.

What people are saying on Facebook's social network

Oracle's new services include "social relationship management" tools to analyse what people are saying on Facebook's social network and other online forums just as Twitter.

In an apparent effort to underscore his commitment to Oracle's new focus, Ellison sent his first tweet shortly afterwards leaving the stage Wednesday. His message promoted Oracle's new cloud computing applications while after all saving enough space to throw a jab at SAP.

The king of expensive bloatware that locks unsuspecting business into using their As a matter of fact BAD SOFTWARE for years. This piece of garbage should be locked up for what he has done to the IT industry.

If the business is "unsuspecting" it's their own fault - they should have done their technology. The same goes if they are buying bad software.Their enterprise database solutions are pretty good however the rest, as you say, is pretty bad. A good thing no-one is forcing anyone to buy any of it.

Their biggest problem will be moving from their current high margin business model into the future. And for goodness sake, sort out the customer engagement model. Trying to find someone with the authority to talk to in Oracle is like trying to find your way out of The Louvre, blindfolded with a broken leg!

The Commonwealth Bank is banking on more than real-time transactions and iPhone apps to claim innovation leadership into the future.