Calling his new Autonomous Database “the most exciting and successful new-product offering in the history of our company,” Oracle founder Larry Ellison is expecting to trigger a massive wave of revenue growth for Oracle with a product he says every customer needs but no other vendor offers.
Ellison delivered an extreme buildup for the industry’s first and only self-driving database during Oracle’s earnings call last week. And if he and it can come close to delivering on those promises, Oracle could quickly join Microsoft and Amazon as the most-powerful cloud vendors on Earth.
“If” is, of course, the key word there. But Ellison and Oracle have a number of factors working in their favor:
- the power of incumbency: its traditional Oracle database is already by far the dominant database in the business world;
- the power of innovation: no other tech vendor that I’m aware of is offering anything remotely as ambitious as Ellison’s Autonomous Database;
- the power of the cloud: as the enterprise cloud becomes the foundation for digital innovation and transformation, Oracle’s cloud-native Autonomous Database is a natural fit; and
- the power of customer demand: companies in every industry are striving to become data-driven digital businesses, and they’re eager to adopt powerful and proven new technologies that can accelerate that journey for them.
Oracle CEO Safra Catz on Autonomous Database’s Potential
Now, before we hear from the eminently quotable and frequently provocative Ellison, let me share a comment from Oracle CEO Safra Catz, whose brilliance is matched only by her understatedness. Unfailingly low-key in her limited public commentary, even Catz spoke fairly glowingly about the future revenue prospects for Autonomous Database.
When an analyst asked Ellison and Catz if they could give some dimension to the market size for Autonomous Database, Catz said offered a broad number but also—and more important—hinted at huge pent-up demand among customers.
“It’s billions,” Catz said.
“The reality is that most of our customers have been waiting for us. They’ve not yet brought those critical, large, and security-conscious workloads to the cloud so far.” And those thousands and thousands of business customers are holding out for Autonomous Database, Catz said.
“They didn’t bring [those mission-critical workloads] to the other vendors. The other vendors are all actually having trouble in the enterprise with these important workloads.”
Autonomous Database By the Numbers
Catz went on to say that among the 2,000 customers currently under contract for Autonomous Database—as opposed to the nearly 4,000 running trials—the trend has been for small experiments to rapidly explode in size and scale.
“As they started to bring smaller workloads in—they can start quite small—then their next bite is 10 times the size. And the opportunity is often a thousand times the size.”
“And that’s what we’re starting to see. How long will it take? I don’t know. We’re not… we’re trying to just go with it,” Catz said.
“The opportunity is literally enormous, because many of these workloads, they can’t go to the cloud any other way. Those that have tried have been either unsuccessful or it’s been both expensive and a big risk to their security situation.
“So this is a very, very powerful moment for us. We’re not going to overplay it here. We’re just going to ride along with it.”
Okay, so much for the voice of restraint.
Earnings Call Highlights from Larry Ellison
Here are a few gems from Ellison. I highlight these because, whatever you might think of Ellison, he’s established a track record in the tech industry and the global economy that very few others can match. He’s been doing it, over and over, for 40 years.
And beyond the many thousands of products that Oracle’s brought to market across those four decades, this is the one Ellison feels will be “the most exciting and successful” of all.
1. Eliminating Human Error While Dramatically Improving Cybersecurity.
“In an autonomous system, the Capital One data breach could never have happened, because the Oracle Autonomous Database doesn’t let human beings configure the system. It configures itself automatically. The Oracle Autonomous Database system doesn’t ask human beings to patch it to close security holes. This system automatically patches itself while running.”
2. The Capital One Breach Could Not Have Happened with Autonomous Database.
“Let me point out how reasonable Amazon was when they refused to accept responsibility for the configuration errors made by the people at Capital One. They have a policy that said, you have control of your data, you have control of your system, you are responsible for running your system. And if you make mistakes, it’s on you. It’s not on us. That is not an unreasonable position.
“When you have a totally manual system and your users are responsible for configuring the system, when your users are responsible for backing the system up, when your users are responsible for encrypting the data, when your users are responsible for patching the systems, user errors can lead to catastrophic results. In a manual system, there is no way to prevent that.”
3. “Incredible Pull-Through” for Other Oracle Products and Services.
“In Q1, we added more than 3,700 new Autonomous Database trials. We now have over 2,000 paying customers for the Autonomous Database and we’re seeing incredible pull-through with the Autonomous Database. You come to the Oracle Cloud to use the Autonomous Database, and then you use a variety of other services.”
4. Some First-Time Customers That Never Used an Oracle Database Before.
“We’ve added many customers to the Autonomous Database that weren’t Oracle customers at all. 13% of the people using Autonomous Database had never bought a database from Oracle Corporation. 43% of the workloads that are going on to Autonomous Database are net new.”
5. Expects to Add 1,000 More Paying Customers Sept. 1 to Nov. 30.
“We think the demand is enormous and we think the leading indicator is just the number of trials we’ve signed up in Q1 (3,700). So our cloud sales force—we had incredible cloud activity in Q1—again, we signed more than 500 Autonomous Database deals in Q1. And we expect to double that in Q2… And that pipeline has just started building. That is the best early indicator and that will drive not only cloud revenue, but also license revenue because of the options.”
6. (My Favorite) “Because the growth rate is so extraordinary, we’re not forecasting it.”
“When Safra gives you a forecast, she’s not forecasting this incredibly steep growth curve in Autonomous Database. So, we’re giving, I would say, a conservative point of view, especially in terms of Autonomous Database. But again, this is a case where we have a technology that nobody else has.”
7. Oracle is “bigger [in database] than IBM and Microsoft combined.”
“We are the dominant database supplier on the planet Earth. We’re bigger than IBM and Microsoft combined. In the previous battles, in the previous war on-premise, we were bigger than Microsoft and IBM combined, our two biggest competitors.”
8. And compared to open-source cloud databases, Oracle is “100 times more reliable.”
“There are bunch of open-source cloud databases and a lot of them are specialized, and there are probably a dozen of them or more for that matter. But none of them are autonomous, none of them are secure, none of them patch themselves while running, none of them give you 99.995% availability. I mean, we’re 100 times more reliable. I mean, seriously, 100x more reliable than these guys!”
9. “We can pretty much ensure that your data can’t be stolen.”
“We are the only system that we can pretty much ensure that your data can’t be stolen because you can’t make pilot errors. You can’t make mistakes, because all of those decisions are automated.”
10. Database Is Just the Beginning: “It’s our goal to deliver the world’s first and only completely Autonomous Cloud.” “
“We’re not stopping at Autonomous Database. At OpenWorld, we’ll be announcing a whole bunch of new autonomous services—and no one else is doing this… It’s our goal to deliver the world’s first and only completely Autonomous Cloud… You should have a bunch of autonomous services to operate that cloud so that human beings aren’t given the opportunity to make mistakes, and instead people can concentrate on building applications rather than managing the plumbing of the cloud, which is complicated and error-prone and expensive.”
So clearly Ellison’s a gifted storyteller as well as a technology and business legend. But will this new database live up to all this high praise and result in the most-exciting and most-successful product in the history of Oracle?
Well, if it can come close to fulfilling any of Ellison’s projections, then I for one believe the Autonomous Database will richly deserve that lofty description.
Disclosure: at the time of this writing, Oracle was a client of Cloud Wars Media LLC.
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