DN has a very interesting post you should read on market watch. Oracle is being called out for a number of serious concerns relating to cloud. The market is finally realizing what we all know, that Oracle is just a "cloud pretender."
LJE is doing exactly what he said he would years ago.
"We’ll make cloud computing announcements because, you know, if orange is the new pink, we’ll make orange blouses. I mean, I’m not gonna fight this thing … well, maybe we’ll do an ad. Uh, I don’t understand what we would do differently in the light of cloud computing, other than market … you know, change the wording on some of our ads."
The market watch post hits all the high points.
Just over two years ago, Larry Ellison declared that Amazon’s lead in cloud services was over and that Oracle would offer it greater competition. Last month, Ellison, Oracle’s chairman and chief technology officer, doubled down and said the company’s future will be determined by the success of its Cloud ERP SaaS Service and its Autonomous Cloud Database offerings.
However, Oracle’s ORCL, -0.77% results as an emerging leader in the explosively growing cloud market are far from convincing, and that is a worrisome sign for the company’s future.
While Ellison has talked confidently, the market is telling a different story. Oracle’s market share has remained relatively small in comparison to Amazon (about 33%) and Microsoft (about 13%). It even has been overtaken by VMWare, which analysts didn’t even track a year ago, in overall enterprise adoption for shared cloud use, or Public Cloud.
In another worrying sign, Thomas Kurian, a key executive in the company’s cloud effort, recently departed amid differing opinions with Ellison about the direction of Oracle’s cloud product. Kurian said he believed the company needed to be more available on Amazon Web Services and Microsoft Azure to diversify from its own struggling cloud infrastructure.
To me, this is a clear indication that the company knows it is struggling to compete. But rather than looking to be more flexible, its vision is to push Oracle’s 430,000 ERP customers to use its infrastructure rather than, as many of their competitors do, let their software run on the cloud of the customer’s choosing.
Perhaps Oracle’s struggles to truly compete in the cloud space are best reflected in the company’s sudden change in its earnings report in June, when it stopped breaking out cloud services and started bundling cloud numbers into broader licensing numbers. Oracle suggested that customers are buying licenses, but since its customers are running their services both on premises and in the cloud, it made more sense not to break out the numbers.
Unfortunately, I believe that type of change in reporting reflects more as an admission of slowed growth than an improvement in how it reports revenue. Several equities analysts shared my sentiment, with Patrick Walravens, an analyst with JMP Securities, suggesting that Oracle needed to shift the narrative away from the cloud because not only is that business not growing, but the overall growth of the company had slowed to only around 1%.
This raises an even bigger question of whether Oracle can keep growing if its cloud business stagnates.
https://www.marketwatch.com/story/oracle-is-being-unmasked-as-just-a-pretender-in-cloud-services-2018-10-26