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A Sunny Outlook for All in Microsoft and Oracle's Cloud Partnership?

By Paul Rubens (Send Email)
Posted August 20, 2013


So Microsoft and Oracle have finally buried the hatchet and made friends with each other. The two companies announced a partnership deal in June that allows Oracle's customers to run Oracle's database and other software on Microsoft's Hyper-V hypervisor or in its Azure cloud, Virtually Speakingand it allows Microsoft to offer a fully-licensed version of Oracle's Java, plus development tools, to its Azure customers.

What's behind this unlikely partnership? The answer is good old fear — on both sides.

The fact is that Oracle knows the public cloud is the future, and many of its customers are going to want to put their Oracle database-based applications up in the cloud in the near future. And if that's not easy to do, then the company fears customers may abandon its software in favor or more cloud-friendly alternatives.

Right now Oracle customers can run Oracle software in Amazon's public cloud. (They can also run it the Oracle Cloud, but let's face it: that particular cloud has hardly been a huge success to date, so we'll ignore it for now.) But the Azure cloud is also big and getting bigger, so Oracle feels it has no choice but to make sure that its software is certified to run on Microsoft's hypervisor in the cloud.

Microsoft's Motivation

Microsoft's motivation for the deal was also fear, but in its case Redmond was petrified that it would get left behind by Amazon in the public cloud space. Not only does AWS support Oracle, it also offers Java, and because of that it gets a great deal of developer support. So Microsoft felt it had no choice but to get its hands on Java as well.

Did Microsoft want to host Oracle-based applications as well? Maybe, but maybe not.

Microsoft does have SQL Azure after all. But SQL is not in the same class as Oracle's database by any stretch of the imagination, so it's doubtful whether many companies would have re-engineered their enterprise applications around SQL to run them on Azure if Oracle wasn't available.

These companies instead would likely have chosen to move their applications to AWS — or even Oracle Cloud. So the deal may have damaged SQL's cloud prospects, but only by a little bit.

Accepting Oracle's database and database-related applications was simply the price Microsoft had to pay (in non-monetary terms anyway) in order for it to get its hands on a Java license. In any case, Microsoft wants to be a services company — so offering Oracle's database in its cloud while continuing to offer its own SQL solution is not such a big deal.

Who Loses in the Deal?

Perhaps what's most interesting about this deal, though, is what it says about VMware and its server virtualization aspirations in the cloud. A lot of the Oracle's customers are also big VMware users, and it's just these sorts of large enterprise customers that VMware would like to see using its cloud offerings and its whole hybrid public/private cloud infrastructure.

Microsoft and Oracle seem to have put the kibosh on that with this partnership — a smart move on Microsoft's part.

So overall the deal looks like good news for Microsoft's Hyper-V and Azure, and good news for Oracle customers. But it looks like a vote of no confidence in Oracle Cloud and SQL Azure, and a kick in the teeth to VMware's ESX hypervisor ecosystem for good measure.


Paul Rubens is a technology journalist and contributor to ServerWatch, EnterpriseNetworkingPlanet and EnterpriseMobileToday. He has also covered technology for international newspapers and magazines including The Economist and The Financial Times since 1991.

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