Oracle Aims to Overtake AWS With Simplified Cloud Services Pricing

Oracle chairman Larry Ellison touted simplified pricing and what he claims is a huge price/performance advantage compared to cloud market leader Amazon Web Services.


REDWOOD SHORES, Calif.—Previewing what may well be the biggest news at the company’s Oracle OpenWorld next month, the database giant gave details of its autonomous or “self-driving” database and a simplified pricing scheme for cloud computing customers.

During the Sept. 19 briefing here at Oracle headquarters, Oracle’s outspoken Executive Chairman Larry Ellison took aim at rival Amazon Web Services, just as he had a year ago at the company’s annual conference.

“Our approach in the cloud business is to lower your costs and risks by completely autonomous software that runs itself and eliminates the cost of human labor. That’s very different than what Amazon is trying to do. They are not even working on this,” Ellison claimed.

Central to Oracle’s pricing scheme is to match what AWS charges, but still offer a better deal or lower total cost of ownership.

“Our strategy with Infrastructure as a Service was to be very aggressive on list prices, to sell at the same price as Amazon does for storage and compute and compete on running our infrastructure and applications faster than Amazon,” said Ellison.

At Oracle Open World the company will provide more details and proof points, but basically Ellison asserted Oracle runs twice as fast as AWS resulting in a 50 percent cost savings for customers.

Oracle also announced that customers wanting to move to a Platform-as-a-Service cloud computing model can use their existing on-premises license for Oracle database, middleware analytics and other services starting Sept. 25. Ellison noted that Platform as a Service is very labor intensive to manage and maintain. Oracle said it’s going to greatly reduce that cost with the “world’s first autonomous” or “self-driving database.”

“We think (Paas) is a much better deal than IaaS because you drive out labor costs and the cost of human error,” said Ellison. He noted that human error can have extreme consequences such as the recent Equifax breach that exposed the records of 143 million U.S. consumers.

The breach apparently occurred because Equifax failed to patch a known flaw in the open source software it was using. Ellison claimed Oracle’s autonomous database will automatically apply security updates including patches as well as self-tune without any down time.

“There’s going to be no more looking for a window of time to put security patches in. That’s nonsense,” he said.

Oracle plans to guarantee 99.995 percent uptime with its autonomous database. “We’ll put it in the [Service Level Agreement] and give you your money back if you don’t get it,” Ellison added. “The planned downtime (you can expect) is less than 30 minutes for the entire year. There is nothing close to that in the cloud industry.”

Oracle will demonstrate the autonomous database and provide more details about its cloud services initiative the first week of October at its Oracle OpenWorld conference in San Francisco. Availability is slated for December.

Universal Credits, a simplified, more flexible pricing model

Also on the pricing front, Oracle said its new Universal Credits model for the purchase of cloud computing services will be available starting Sept. 25. Ellison said the goal of Universal Credits is to simplify contracts. Again he criticized AWS, claiming its contracts are far too complicated.

“With Amazon, say you want to buy $100,000 worth of services. You have to say what data center you want it in, what services you want, what services you are going to need and more and then they’ll calculate your costs,” he said.

By contrast, when you buy $100,000 or any other amount of Universal Credits, Ellison said you’re free to spend it on any services you like without having to say in advance what it will be used for.

“You can use any of our services on demand and that’s what you’ll get billed on,” he said. “If you use IaaS or Paas or buy storage, that’s what you’ll be billed for without having to figure out in advance what you need to buy.”

Also, you won’t have to create a new contract to purchase new services that Oracle introduces since they can be purchased with the Universal Credits you already have. As before, the volume of services you purchase determines the discounts customers are entitled to.

David Needle

David Needle

Based in Silicon Valley, veteran technology reporter David Needle covers mobile, bi g data, and social media among other topics. He was formerly News Editor at Infoworld, Editor of Computer Currents...