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Oracle's Week Of Mega Deals Leaves Questions

As CEO Marc Benioff heaps compliments on Larry Ellison, what's the future for Oracle cloud apps,

Oracle CEO Larry Ellison and CEO Marc Benioff took part in a 45-minute conference call on Thursday to talk about the nine-year strategic partnership announced this week. The stated purpose was to give the press and financial analysts a chance to ask questions, but the two executives spent so much time lavishing compliments on each other and emphasizing the comparatively simple act of integrating cloud apps that they left little time for questions. What's more, some of the questions that were asked weren't adequately answered.

It has been a monumental week of strategic partnerships for Oracle, starting with the cloud partnership with Microsoft announced on Monday, the partnership announced on Tuesday and the NetSuite deal unveiled late Wednesday. Oracle President Mark Hurd fielded questions for the red team during the joint press calls with Microsoft CEO Steve Ballmer and NetSuite CEO Zack Nelson, respectively. Benioff, the former Oracle employee who often cites Ellison as one of his mentors, was given an audience with his former boss.

The two executives started by revisiting the basics of their nine-year partnership. will standardize on Oracle Linux, Oracle Database, Oracle Java Middleware and Oracle Exadata; Oracle will integrate Fusion HCM, the Oracle Financial Cloud and other applications with for rapid implementation and interoperability. Then it was on to the glowing remarks.

Benioff: I want thank Larry, because Oracle is always there for us whenever we need them, and they are a true partner.

Ellison: Virtually every time we buy a company they are running CRM.

[ Want more on Oracle's deal with Microsoft? Read Oracle Goes All In On Microsoft's Cloud. ]

Benioff: There's no better product in the world in the database area than Oracle.

Ellison: We see all over the market. They are the market leader, and our customers expect us to work gracefully with

Benioff: After so many decades of leading Oracle, Larry's leadership has really ensured that Oracle is the best database product in the world.

You could boil the script down to three key messages: Oracle is a great database vendor that gives us secure, reliable, cost-effective and high-performance infrastructure; Salesforce is the leading cloud company and the CRM leader; We're going to find ways to work better together so customers can integrate our products quickly, save time and money and get better performance.

Largely off the script during this week's conference calls was the question of where these partnerships leave Oracle's strategy. You're left with the impression that it's abdicating cloud platform leadership to Microsoft Azure, cloud CRM leadership to and cloud ERP leadership to NetSuite.

How does this make Fusion applications more appealing, Ellison was asked?

"We have a lot of customers that use Oracle applications. It's a graceful upgrade from our current on-premises ERP applications to Fusion ERP in the cloud and Fusion HCM in the cloud," he began, but then he returned to the "we're going to work better together" script.

"We don't want each and every one of those customers to have to hire a third-party or to have to spend a lot of money to wire up a Salesforce application with Oracle applications," he said. "That makes Fusion applications much easier to adopt."

At the very least this is a frank admission that Salesforce and NetSuite are much bigger in the cloud than is Fusion, so they're in a better position than Oracle itself to pull along sales of Fusion HCM and Fusion Financials. But if you're a current or potential buyer of Fusion CRM or Fusion ERP, Oracle's endorsements and ready-made integrations with Salesforce and NetSuite have to leave you wondering if they're really in the game.

We heard Ellison ridicule's "proprietary" Apex code and Heroku's "non-industry standard" Java repeatedly at Oracle Open World. Salesforce is like a Roach Motel, he said: "Your apps check in, but they don't check out."

Benioff did his best to skirt around the question of how the Oracle partnership changes support for Java development, saying, "we want to continue to do more with Java. This is a great opening for us to go even farther with Java and Oracle. And I hope Java developers will feel welcome using the infrastructure."

Then Ellison kind of swept away all doubt and made it clear that nothing has changed -- yet.

[ Want more on Oracle's partnership with NetSuite? Read Oracle, NetSuite Partner To Storm Cloud. ]

"There are going to be opportunities for Oracle and Salesforce to work together on the language part of the platform..." he began, "...but this is an area where we're not ready to announce any kind of agreement. It's an area where and Oracle can explore. If it makes sense, we'll have another announcement, have another call and make all the developers happy."

The kind of leaves you wondering just how will use Oracle Java Middleware internally for the application versus how it supports Java development on and Heroku. Oracle-licensed Java seemed to make a difference to Microsoft in their partnership. Microsoft previously used the Open Java Development Kit to support Java on Azure, but it said Oracle licensing made it a "first class" development option on Azure.

Happy Talk Ahead?

Are the days of hearing all those fun and entertaining pointed barbs from Ellison and Benioff over? This was one of the ten or so questions that actually got through during the conference call on Thursday.

"I hope it's not the end of the fun because that's one of the things that I enjoy most about our industry," responded Benioff, who in the past showed pictures of Oracle Exadata with a "False Cloud" logo on top. "We've always enjoyed working together and having fun with each other. Hopefully it will be the end to us getting a little too revved up at times."

That "revved up" comment was an obvious reference to past incidents such as Benioff's protest keynote staged at the St. Regis Hotel across the street from the Moscone Center when Oracle switched his speaking slot at the last minute.

"I'm sure both Marc and I are going to try to continue to be entertaining while making sure that the entertainment never distracts from our commitment to work together," Ellison said.

No doubt the guns will be turned on competitors who don't have a commitment to work together. Ellison may not pick on anymore, but watch out for more barbs pointed at IBM and SAP. And with the imminent release of Oracle Database 12c, expect a double dose of security scare talk and object-database aspersions cast in Workday's direction.

As for Benioff, it's easy to imagine him turning up the heat on SAP and cooling his rhetoric about Oracle. Given the HCM and Financials tieup with Oracle, it seems like Salesforce has thrown its erstwhile partner Workday under the bus, but it's hard to imagine Benioff trading barbs with his cloud computing peers. He has played the cloud computing champion for a long time, but now it might be harder for Benioff to cast himself as the rebel against the old way of doing things.

"This partnership ends any vestige of Salesforce’s claims of independence from Oracle," commented SAP in a statement. "All the past squabbling about false clouds and keynotes now appears as sincere as a professional wrestling match."

Will Salesforce and NetSuite eventually wind up in the Oracle portfolio, with Ellison in semi-retirement as Chairman and Benioff as the new CEO? It's easy to picture the two sipping Mai Tai cocktails together in Hawaii, plotting Oracle's next moves.

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