A Look at Oracle’s Rare Cloud Advantage
Pricing war isn’t a viable strategy
The cloud computing competition has presented a variety of outcomes so far. Sometimes providers wage price wars, which Amazon (AMZN) and Microsoft (MSFT) have excelled at. Touting their innovation is another strategy used by these providers.
For example, Alphabet’s (GOOGL) Google noted that it wants to build its cloud narrative around service quality rather than price competition. Although Google is one of the cloud underdogs in terms of market share, it believes that competing on pricing isn’t a viable strategy, so it’s looking for a clear distinction. Amazon, Microsoft, Oracle (ORCL), and even Google have at various stages waged cloud pricing wars.
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Innovation war could complicate cloud competition
If innovations such as AI (artificial intelligence) and ML (machine learning) are going to shape future cloud competition, Oracle could be a serious force to contend with for Amazon, which is the clear market leader in cloud computing.
As shown in the chart above, Amazon’s cloud division, Amazon Web Services (or AWS), is miles ahead of the competition in cloud market share.
Data wealth could make the difference
As a long-time enterprise software vendor, Oracle has access to vast amounts of vital data that it can leverage to sharpen its AI and ML edges and bolster its cloud competitiveness. Data wealth could also be an advantage for legacy software vendors Microsoft and IBM (IBM) in their competition with Amazon in the cloud.