How Microsoft and Oracle became cloud buddies, and what’s next for their improbable partnership – GeekWire

Don Johnson, executive vice president of Oracle Cloud Infrastructure, describes the Microsoft partnership as “easy and natural,” despite a rocky history between the companies, given their shared interest in serving their joint customers. (GeekWire Photo / Todd Bishop)

Splashy partnerships between big tech companies can be hard to take seriously. Implementing them with success is much harder than announcing them with fanfare. Sticking with them for the long haul is rare in a rapidly changing industry.

But Oracle is committed enough to its budding cloud relationship with Microsoft that it’s literally cozying up to its longtime rival — getting as close as possible to Microsoft’s Azure data centers when deciding where to put its own.

The goal is to connect Oracle Cloud Infrastructure to Microsoft Azure as seamlessly as Oracle would connect two of its own data centers in the same region, allowing businesses to run different components of an application in concert across the Oracle and Microsoft clouds.

This is a core promise of the “multi-cloud alliance,” as they call it. Distance matters when progress is measured in tenths of a millisecond.

In one common scenario, for example, the companies say businesses will use Oracle Database on Oracle Cloud Infrastructure while running the related application and web components on Microsoft Azure.

“The farther apart you make them, the more workloads will struggle with that,” explained Don Johnson, executive vice president of Oracle Cloud Infrastructure, in a recent interview at the company’s Seattle engineering center. “But if you get them reasonably close, you enable many more scenarios to run in that configuration.”

Oracle’s Cloud Experience Center in downtown Seattle. (GeekWire Photo / Todd Bishop)

The companies are announcing their latest move on Wednesday, expanding their partnership internationally by connecting Microsoft Azure to Oracle Cloud Infrastructure in London. Oracle describes London as one of the most active for Oracle Cloud, making it a logical next step for the Microsoft partnership. It’s the second region where the companies have established this type of link. The first was between their respective Virginia data centers, which began when the companies announced their collaboration in June.

So far, these connections are between existing data centers, but as Oracle expands its cloud footprint, Azure locations will factor into its siting decisions, Johnson said.

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The companies are counting on the cloud to fuel their growth, raising the stakes for their partnership. They describe the alliance, in part, as a way for their customers to avoid being locked into a single cloud vendor. In that way, the companies are effectively teaming up against their common competitors, the biggest of them being Amazon Web Services and Google Cloud.

Oracle is playing catch-up in the cloud, aiming to expand beyond its legacy in databases to build out a fully-fledged public cloud platform, attempting to going toe-to-toe with Amazon, Google, and Microsoft for a wider range of cloud contracts. Oracle reportedly laid off hundreds of people from its cloud-focused Seattle office earlier this year in an indication of the uphill climb it faces.

One reason the Oracle-Microsoft partnership was a surprise was the long history of antagonism between the companies — sparked by their rivalry in database technologies, and fueled by numerous conflicts and legal entanglements, including a notorious incident nearly 20 years ago that came to be known as “trashgate,” in which investigators working on behalf of Oracle attempted to purchase the garbage of a pro-Microsoft advocacy group.

Even in recent years, Oracle executive chairman Larry Ellison hasn’t been known for soft-pedaling his commentary on Amazon and Microsoft. Just this week, Oracle displayed its fighting spirit, announcing that it would appeal a court ruling that upheld the Pentagon’s decision to name Microsoft and Amazon as the two finalists for a coveted $10 billion government cloud contract.

Larry Ellison, Oracle’s co-founder and CTO, speaks at Oracle OpenWorld 2018. (Oracle Photo)

But from a business perspective, Johnson said, the alliance makes sense.

“Step back and look at the reality — look at it through a customer lens,” he said. “At this point, most growth in the cloud is coming from the big businesses who were not born in the cloud. … A vast majority of them have a big Microsoft estate, and have a big Oracle estate. And if the cloud platforms treat themselves as silos, it puts people in an awkward position, because not all of these platforms satisfy all of their needs.”

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Companies including Albertsons, Gap, and Halliburton are among the corporate customers that have said they are running applications across the Microsoft and Oracle clouds as a result of the alliance.

Microsoft and Oracle don’t describe their partnership as exclusive, but it’s not likely to be replicated by either with another big cloud company. Amazon Web Services, as the public cloud leader, has “no need or desire or even track record of really collaborating with any other platforms, and I don’t see them doing that anytime soon,” Johnson said.

Scott Guthrie, head of Microsoft’s Cloud and AI division. (GeekWire Photo / Kevin Lisota)

In contrast, Scott Guthrie, head of Microsoft’s Cloud and AI division, described the Oracle alliance as “a natural choice for us as we help our joint customers accelerate the migration of enterprise applications and databases to the public cloud,” in the original announcement unveiling the alliance.

Oracle’s Johnson said the partnership grew out of an initial meeting he had with Guthrie and his team toward the beginning of the year. He recalled the conversation as “easy and natural,” given their shared interest in serving their joint customers. After working out the initial details on the partnership, they arranged to get Ellison and Microsoft CEO Satya Nadella on the phone to discuss the concept, making sure to get the blessings of the top executives before proceeding.

The teams continue to collaborate on an ongoing basis to expand the reach of the alliance.

“This came together very naturally and very quickly,” Johnson said, describing the partnership as “super collaborative, from Larry and Satya on down.”

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