Oracle’s multicloud revenue is growing at a 1,529% pace but chairman Larry Ellison believes the multicloud business is only beginning to hit its stride as most of that growth is coming from Microsoft Azure while the Google Cloud and AWS multicloud businesses are just starting to ramp up.
Ellison made that observation during Oracle’s recent Financial Analysts Meeting in a discussion about whether the Oracle Database business could reach $20 billion in revenue in five years. Drawing laughter from the crowd by saying he does not want to appear overly bullish in front of an audience of financial analysts, Ellison said the intense urgency among customers to become full participants in the AI Revolution will surely boost demand for the Oracle multicloud business.
While that’s clearly going to provide a huge boost for Oracle, the bigger story is ongoing influence being exerted by customers over the Cloud Wars Top 10 vendors to do everything possible to drive four strategic outcomes for customers here in the early days of the AI Revolution:
- Simplify the process of extracting value from enterprise tech.
- Expand customer choice for using multiple cloud and AI vendors.
- Shorten the time to value and innovation.
- Stop offering any semblance of “walled garden” technology that directly or indirectly attempts to limit the options available to customers.
I would contend that the string of unprecedented multicloud partnerships made possible by Oracle and announced over the past 12-18 months have been an enormous factor in Oracle’s stunning growth because it not only met all of those four criteria but in fact created them as standards that other vendors must live up to.
This is a momentous breakthrough for business customers who for the first 12-15 years of the cloud had to live in large part by the rules set by the vendor community. But Ellison’s vision changed all that through the formation of these unprecedented multicloud partnerships that let customers buy and run the database they so often want — Oracle’s —via the Microsoft Cloud or Google Cloud or AWS.
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If you’re wondering why I’ve used terms like “momentous” and “unprecedented” in describing the Oracle multicloud business, please bear this in mind: in many of those cases, Microsoft salespeople or Google Cloud salespeople or AWS salespeople are selling and receiving commissions for selling the Oracle Database through those other vendors’ clouds!
So, when Ellison says that the vast majority of the 1,529% growth in multicloud revenue came from the Microsoft partnership — it was the first of the three partnerships and got an early jump on infrastructure buildouts — that means that intense demand from Google Cloud customers and AWS customers is only just beginning to be fulfilled.
Describing the role of the new Oracle AI Database in AI reasoning — which will be done by hundreds of thousands of businesses, versus in AI training, which is largely limited to a fairly small set of AI firms and huge corporations — Ellison said, “We think everyone is going to want to do AI reasoning [aka “inferencing”] — I don’t know who’s not going to want to do that,” Ellison said at the financial analysts meeting.
“And one thing we do know is that it’s not going to be a demand problem, that’s for sure.”
Ellison then described Oracle’s efforts to get that AI-reasoning power into customers’ hands quickly.
“The good thing is that so most if not all of our customers are already using the Oracle Database, and we’ve made it very simple for them to just add the new features in our AI Database,” Ellison said.
“And we’re confident that our multicloud deals with Microsoft and Google and Amazon will provide a huge amount of that growth, particularly as we complete the multicloud infrastructure buildouts for Google Cloud and AWS,” Ellison said.
“That 1,500% multicloud growth rate has been largely driven by Azure, which is the first multicloud partner we signed up. And so the multicloud business with Google and AWS is nowhere near the scale we have with Azure.”
Then, looking down into the audience at the top-level Oracle executives sitting in the front row, Ellison laughed and said, “Maybe I shouldn’t say this out loud, but I think our multicloud business alone might get us to that $20 billion number for database revenue in five years.”
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