Oracle – The Constant Competitor

It is hard to believe in technology how far we have come in such a short time.  Through the years companies have come and gone.  There were times when the “hot” companies were Sun Microsystems, AOL, Yahoo, WordPerfect, Lotus, Novell, Informix, Enron, Qwest (pre-USWest acquisition), MySpace etc..It is a long list.  Some are still around but a shadow of what they once were.  Today we have a whole host of new “glamour” companies like VMWare, SalesForce.Com, Google, Research in Motion, Facebook, Twitter etc..Some of these companies will survive others will burn out in a flame of glory and still others will slowly die or be acquired.  There are a few stalwarts who have survived.  Some died and came back like Apple.  Others have just plodded along achieving great success later like Adobe.  In my many years in tech one company that is a constant and I have admired from a far is Oracle.

Founded by the eccentric and eclectic Larry Ellison Oracle has risen from nothing to make Larry one of the. richest guys on the planet.  I first heard of Oracle back at my first MGX in San Diego in 1904.  Microsoft was building a database business with SQL Server and had targeted Sybase and Oracle as its two strongest competitors.  At the time we knew we were no match for Oracle.  We were going to tackle Sybase first and then go after Oracle.  I remember quite well Bill Gates on stage talking about the future and going after Oracle.  Microsoft felt that they were priced way too high and that eventually would come back to haunt them.  Bill even poked a little fun at Larry Ellison saying, “I could pick on Larry, but that would be too easy”.  Sixteen years later the fight goes on.

There are a lot of characteristics about Oracle that have allowed them to succeed.  One area in the industry where they are legendary is their sales force.  Oracle has the reputation of being cut throat in sales.  Only Type A personalities need apply.  It is interesting to note that the culture was created by a man who was a former Mormon Bishop.  It’s well know in the  industry that at Oracle you can be a superstar one month and irrelevant the next.  Microsoft’s sales culture does not have that type of attitude.  A large part is due to the licensing practices Microsoft has which creates a situation where a Microsoft rep has sold a bunch of licenses that may be sitting on a shelf and the Microsoft  field force is not incented to get customers to utilize.  Oracle also in the enterprise space has partners willing to sell in Oracle solutions to customers,  Having competed against Oracle the value of these partners solutions is very hard to win against. It is especially hard when those partners do not have an equivalent Microsoft based offering.  On top of that most enterprise customers have a lot of Oracle DBA’s.  As the CIO of T-Mobile once told me, “I don’t know what they do but I pay them”.  When you add all these things together – aggressive sales force, strong partner channel, and an army of DBA’s trained on Oracle you have a hard to beat competitor.  In my opinion current Microsoft COO Kevin Turner would fire the Microsoft sales force in a heartbeat to have Oracle’s

Oracle is an enterprise company.  Larry Ellison goes where there is lots of money.  Enterprises have lots of money.  I admire the focus Oracle has on selling into the enterprise.  Beyond selling into the enterprise Oracle has enhanced its position with a focus on acquiring companies that help facilitate more sales into the enterprise.  They acquired Siebel the dominant CRM vendor.  They acquired ERP power PeopleSoft.  For the middle tier they acquired BEA Systems.  For the developer (and hardware vendor) they went out and got Sun Microsystems (in the enterprise Java rules).  I will add that as part of this acquisition of Sun they also got MySQL, the number one open source database.  Since open source means it is free, Oracle is quietly killing it as Larry Ellison makes no money. In my opinion they have been very smart in who they went after and how they would fit into the Oracle empire.

I would add that this focus has blunted Microsoft ability to overtake Oracle as the leader in enterprise databases.  Oracle continues to have customers believe they can scale where others cannot (besides TeraData).  Despite Microsoft’s continued improvements in this area and all start cast of database people (Gordon Bell, Dave Campbell, Bill Baker and the late Jim Gray).  When I went into accounts they never knew or believed that SQL Server scaled beyond one terabyte.  I attribute this to Oracles efforts to suppress it and Microsoft’s marketing inability to promote it. 

Oracle like Microsoft has its own image problems.  But when I look at Oracles competitive landscape it is not as broad a Microsoft’s and many of the competitor duels as partners like SAP and Salesforce.Com.  They compete against Tibco in the middle tier, but Tibco is a big J2EE shop, so not all bad now that Oracle owns Java.  Oracle has had its share of failures like when they were going to overtake Microsoft Exchange as an email platform   Though I did find it humorous at an Exchange Conference they rolled up an espresso stand for attendees and provide free latte’s along with a promotion for their email system.  They were also smart with Linux and XML.  They jumped all over the Linux OS.   The OS is free but pay Oracle.  On XML I met with Microsoft guru and industry legend Don Box (Don was one of the people who wrote SOAP). Microsoft was just starting to jump on XML.  We were prepping for a meeting with ATT Wireless and he was going to cover UDDI. He said , “Oracle is five years ahead of us”.  I was depressed but when I guy like Don Box speaks it carries a large amount of weight.  He did the whole presentation to ATT Wireless in Notepad.  I was impressed.

There are many things to admire and despise about Oracle but in the end they have never wavered on their business and technical focus.  They continue to lead in the database market after all these years.  as I started the blog so many have competitors have come and gone over the course of time , but Oracle has always had the grit to survive.  I have no doubt in ten years we will still be talking about Oracle.

Good Night and Good Luck

Hans Hoffmann August 19th 2010