The Six Five team discusses Oracle EU Sovereign Cloud.
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Transcript:
Daniel Newman: Let’s talk about Oracle Sovereign Cloud.
Patrick Moorhead: Yeah, so Sovereign Cloud is basically a Cloud that you set up that abides by all the data security. Some countries have, hey, they have to be citizens in that country who manage it. They have to be incorporated in that. And every one of the Cloud players is adopting Sovereign Cloud. Now, sometimes it’s hard to know, hey, they didn’t build a new data center or they didn’t stand up new real estate, what makes it sovereign? Oracle announced their take starting in the EU first, and it’s really straightforward. It’s stood up in multiple countries that are incorporated in those countries. That’s check. It’s abiding by all the EU data sovereignty rules, which by the way also includes that company has to be incorporated in the specific companies in the EUs. But here’s the cool part, there’s no extra added price that goes along with it, and all services are available that are available on the non-Sovereign Cloud.
So again, in pure Oracle fashion, to me, they’ve simplified the message here in a very similar way that they did on-prem Cloud, which was, hey, we’re going to take the same infrastructure that’s in the public Cloud, we’re going to put it on site, that’s Cloud a customer. And you can run the same applications. If you want to be connected to the big Cloud, you can. If you want to be disconnected, you can. And here in this EU Sovereign Cloud, it’s disconnected from the mothership as well. So very simple, very straightforward. Oracle’s on a freaking roll, but this is just another example of them doing simplicity. I saw some really fun and snarky comments from from AWS, Google, and Azure on this. Kind of defensive, which kind of may maybe leads me to believe that there’s something here.
Daniel Newman: Yeah, Oracle’s so popular right now with us that we’re going to talk about them twice on the same show, but we’ll give you a break in between. I mean, look, their growth rate is about three times the size of the other IAS companies right now, which says something. And again, the way every company discloses Cloud revenue is somewhat different so it’s not a straight standup in any case ever anymore, so just know that. So when someone does a 10 best Cloud growth companies and publishes that as some sort of declarative asset, just know it’s mostly marketing gamesmanship. But in all serious, Oracle’s growth has been palpable and impressive. The addition to features like Sovereign Cloud are critical. As regulators drill down on data and data residency and how data is moving from one country to another, the ability to manage that and to enable you to deal with some of the parts of the world that have stricter data requirements is going to be critical.
This is where Cloud hyperscalers really have a bit of an advantage is they can build out these services once and then deliver them at scale to their entire customer data sets. And so for me, this is more of, it is a little bit picks and axes for me. This is kind of like a core feature capability that I would expect, hope, and consider as paramount to Oracle’s continued growth and success, but here they are ticking boxes. They’re ticking boxes, they’re making it easy. And again, remember somewhat, where does Oracle’s huge growth opportunity come from? Well, you have 400,000 people running Oracle’s database and their data sitting. So Oracle in this period of somewhat austerity in business and despite the kind of magnificent seven and the stock prices of Nvidia and Microsoft, most companies are still facing headwinds, business headwinds. And they’re looking at, yes, the Cloud is an operating model, but is there a monetarily advantageous way to get the workloads in the Cloud at a price we can afford?
And if Oracle continues to create more dynamic services and continues to be very aggressive on its pricing, and make no mistake, it is very aggressive on its pricing, it has a chance to continue to take market. And that’s exactly what it’s doing right now. It’s small today, but if it keeps growing at a 3X the rest of the Cloud provider market, it will not be a long time. It does not take a lot of compounding of that growth rate to start to become a real threat. And again, that race for third Cloud is real and at some point over time it adds up and market positions shift. So kudos to Oracle for building out the product services that companies need. And we’ll keep an eye on this one as it goes forward. We’ll be talking more about Oracle in a little bit.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
