Oracle vs. Salesforce: Social Acquisition Face-off (click image for larger view and for slideshow)

Oracle has taken a "strategic" minority stake in Engine Yard, a San Francisco supplier of platform-as-a-service (PaaS), where developers build applications in a tools-rich, online environment.

It's not clear yet how Engine Yard can help Oracle get outside the confines of its own limited cloud concepts, but it has the potential of offering a way for developers to work with core Oracle products in a cloud setting that they like.

The amount of the investment was not disclosed in Oracle's announcement Tuesday. But buying a share of Engine Yard is a concession that frequent affixation of the word "cloud" to its Exadata and Exalogic product lines may not be enough to get it into the cloud era. Oracle's existing PaaS, announced at Oracle OpenWorld in September, uses Exalogic and Exadata. Engine Yard potentially can move Oracle out of the box that it has built for itself into the more general-purpose, Amazon Web Services EC2-type of cloud computing. Engine Yard runs atop Amazon's Enterprise Compute Cloud (EC2).

Oracle has a strong motive to keep developers working with its database plus its WebLogic application server product, its GlassFish Java application server in both open source and commercial editions, and its Java language and other modern, Web-oriented languages such as PHP, Node.js and JRuby. The latter is a popular version of Ruby which runs in the Java Virtual Machine. Ruby code itself is known for the ease with which it can be understood and its rapid development characteristics in the Ruby on Rails framework.

[ Learn how Engine Yard used the Ruby language to become a source of "expertise of scale." See Engine Yard Sees Ruby As Cloud Springboard. ]

Archrival Salesforce.com demonstrated the value of such a developer platform when it bought Heroku in December 2010 for $212 million. Salesforce.com produces CRM, HR and social media software-as-a-service (SaaS), which it runs from its own data centers. It also hosts Heroku PaaS on Amazon Web Services EC2. Salesforce.com has announced plans to allow customer development done on Heroku to be integrated as custom extensions of its own applications.

Like Heroku, Engine Yard is a set of development environments and services that run on top of AWS EC2 and Terremark cloud services. Developers who wish to produce database-intensive services on Engine Yard may one day be able to produce custom additions for Oracle packaged applications. The Oracle applications might be either running on a customer's premises or from Oracle's own SaaS. Engine Yard PaaS services could ensure that a new service would scale to meet demands placed on it.

In its announcement Tuesday, Oracle said it will work closely with Engine Yard "to provide cloud application developers with a greater choice of development and deployment options. The two companies are expected to connect their respective PaaS offerings to enable more rapid development in a secure, reliable and scalable environment."

What Oracle refers to as its "respective PaaS environment" was announced during JavaOne and Oracle OpenWorld this year, and includes database services based on Oracle and Exadata Database Machine and middleware based on Fusion Middleware, including WebLogic Application Server and Oracle Exalogic Elastic Cloud.

Through the cooperation, developers "can more efficiently extend their packaged applications to support additional business requirements," the statement said.

There's a certain logic that pushes Oracle in the direction of Engine Yard. JRuby was created at Sun Microsystems, and in 2009 the JRuby team left new owner Oracle to join Engine Yard to continue JRuby development as open source contributors.

In a July 2009 blog, JRuby developer Charles Nutter responded to the question: "Why did you leave Sun (Oracle)? Did you get the impression that JRuby was to be shelved?" He said, "The primary reason for leaving was the high level of uncertainty involved. On the one hand, we were getting absolutely no indication that JRuby either would or would not be funded. We weren't even allowed to talk about JRuby's future because of regulatory concerns. That makes it difficult to get anything done."

Now JRuby is an important language in the Java lexicon, one that would help keep Web-oriented developers interested in the use of Java, the Java Virtual Machine and Oracle products for future applications. Establishing a link to Engine Yard may be one way for Oracle to re-establish access to JRuby expertise and offer JRuby services in a rich development environment.

Engine Yard was founded in 2006 and has received $38 million in three rounds of venture capital funding.