Couple of comments:

(1) The statement above narrowly defines multi-tenancy (which is about technical architecture and operational model) to sharing databases between customers. Multi-tenancy transcends that, but I understand his target/context is Salesforce.

In the case of Salesforce.com, their secret sauce is their multi-tenant database and the programming model on top of it. I don’t know of any vendor offering similiar both CRM vertical and horizontal capabilities (yet).

(2) From Larry Ellison’s perspective, virtualization is the right way to deliver multi-tenant solutions. It really depends on the solution (i.e. level of abstraction and multi-tenancy layer, and compliance & operational requirements…). However, it would be challenging to find many cloud providers or SaaS services that aren’t powered by some virtualization layer, and can offer sustainable / price competitive services.

(3) Finally, not every solution is suited for “multi-tenant database”. This has to do more with business requirements such as compliance. Even in the case of on-premise solutions, there are situations where an enterprise can’t have two business units share the same database.

Larry’s position is understandable. Over the last two years, Oracle has invested a lot in their cloud stack. Oracle VM and its management framework powers it. They have integrated machines or appliances such as Exadata or Exalogic to enable either enterprises build private clouds or service providers to enable service providers & ISVs offer cloud services…

Taylor (Proformative)

In the last three SaaS offerings in which I have been involved, Oracle was a critical (as a database) was a critical component. I actually think that it is what separates the men from the boys in the marketplace; companies built on a LAMP stack aren’t taken as seriously. Oracle already offers the Oracle SaaS Platform and will discount heavily or offer financing (the equivalent of monthly pricing) to those fledgling companies who can’t ante up for big Cap-ex licensees early on. Subscription base is just a logical next step.

I have looked into this option a number of times and at this juncture it is effectively a teaser. There are strict qualification guidelines and an expectation of a traditional license commitment in short order. My feeling is that this is an interim step toward a real subscription pricing model. Safra knows its coming, but its baby steps first.

In terms of offering their own multi-tenant environment, there is ample evidence to believe that it already exists at Oracle.com as an option to those who would prefer a Cloud delivery over onPremise.

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Thanks

Keep up the great work!

Thanks

To answer your question, multi-tenant vendors don’t charge for each Oracle database license or connection. Everything from Oracle is at the backend and completely invisible to the end customer/user. It’s similar to eating at a restaurant, where one doesn’t pay for each ingredient that goes into the dish, but rather for the entire dish.

It seems from your comments and well as Rob’s, that the reseller channel has worked well for Oracle. salesforce.com, Netsuite and SAP, all powered by Oracle, are key industry players. It also seems that Larry Ellison is becoming more amenable to resellers (which is a new, but welcome development) – as a matter of fact, Marc Benioff, salesforce.com Chairman, is now scheduled to be the keynote speaker at Oracle OpenWorld next week.

I do think that this can be a winning strategy. It allows Oracle to stay away from doing things they’re not good at, while tapping their resellers for expansion in that area. Thoughts?

Now the question is how long IBM is going be sitting on the sidelines with their DB2 and watching Oracle database as the defacto data store. My guess is not long!.

Coming over to the Oracle Application side of business (E-Business Suite) becoming multi-tenant. Not going to happen any time soon. Just look at the disaster they have on their hands with R12 upgrade (change of Set of Books to Org centric architecture).

In the last three SaaS offerings in which I have been involved, Oracle was a critical (as a database) was a critical component. I actually think that it is what separates the men from the boys in the marketplace; companies built on a LAMP stack aren’t taken as seriously. Oracle already offers the Oracle SaaS Platform and will discount heavily or offer financing (the equivalent of monthly pricing) to those fledgling companies who can’t ante up for big Cap-ex licensees early on. Subscription base is just a logical next step.

I have looked into this option a number of times and at this juncture it is effectively a teaser. There are strict qualification guidelines and an expectation of a traditional license commitment in short order. My feeling is that this is an interim step toward a real subscription pricing model. Safra knows its coming, but its baby steps first.

In terms of offering their own multi-tenant environment, there is ample evidence to believe that it already exists at Oracle.com as an option to those who would prefer a Cloud delivery over onPremise.

Good question and I have no idea. I’m sure they have invested and I would assume it will be a massive (and messy) undertaking.

Alok Misra

Interesting questions. Oracle isn’t really known for low pricing. Hard to believe they will provide lower cost subscription based alternatives.