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Oracle's earnings disappoint on a lack of cloud business growth

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Part 4
Oracle's earnings disappoint on a lack of cloud business growth PART 4 OF 5

Why Oracle is a distant leader in the relational database market

Oracle is a distant leader in the relational database market

According to Oracle (ORCL), the company is the leading player in the relational database market, with a revenue share of 48.3%. Oracle also claims that it holds larger revenue share than its four closest competitors combined. IBM (IBM), Microsoft (MSFT), SAP (SAP), and Teradata (TDC) are the four close competitors Oracle mentioned. This shows Oracle’s dominance in the relational database market. In the prior article of this series, we discussed how the cloud services market is undergoing rapid growth, and how Oracle is considered a laggard in this market. However, if we discuss the cloud database market specifically, we should consider that Oracle introduced its Database 12c version last year (the “c” in “12c” stands for “cloud”).

According to Oracle, “Oracle Database 12c introduces a new multitenant architecture that simplifies the process of consolidating databases onto the cloud; enabling customers to manage many databases as one — without changing their applications.”

Why Oracle is a distant leader in the relational database market

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Database 12c is finding early adopters

During the company’s conference call to announce earnings, Larry Ellison, Oracle’s chief executive officer, mentioned how competitors such as Salesforce.com (CRM) are showing interest in integrating their applications with Database 12c.

On the database, Ellison explained, “There are two key aspects of 12c. One that came out with the initial release which is the multi-tenant feature, that’s why it’s called 12c for the cloud. It literally takes any application that you got, any Oracle application you’ve got and makes it a multi-tenant application. Even companies like salesforce.com where it was a supplier and — with to salesforce.com and a competitor with salesforce.com.”

Ellison further stated, “I just recently got a note from Mark Benioff who is excited about bringing in Exadata and 12c and making in at the basis of salesforce.com’s cloud computing infrastructure that they put our application on. So we are seeing adopters with very, very high standards in terms of having to supply millions of users, reliably and cost effectively in the cloud. Talk about moving their entire business to 12c and Exadata. That’s just the tip of the iceberg of these hyperscale companies.”

On adoption of the 12c, Ellison said, “We think virtually all of our customers are on their way to moving to 12c. Now some — they are the early adopters and then there is the rest of the guys who come down the road a bit later. But we think it’s very attractive to our conventional customers and to hyperscale customers like Salesforce and others.”

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