View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Technology
  2. Cloud
April 21, 2017

Cloud wars: Oracle’s data centre boast dismissed by AWS

James Hamilton, an Amazon VP and distinguished engineer, has taken apart the claims made by Oracle's co-CEO Mark Hurd.

By James Nunns

Amazon Web Services has fired back at Oracle after the company’s co-CEO Mark Hurd said that it it didn’t need as many data centres as the big three cloud providers.

Hurd made the claim in an interview with Fortune that Oracle doesn’t need to build as many data centres because its own are more efficient.

The co-CEO said: “If I have two-times faster computers, I don’t need as many data centres. If I can speed up the database, maybe I need one fourth as many data centres. I can go on and on about how tech drives this.

“Our core advantage is what we’ve said all along, which is that it’s about the intellectual property and the software, not about who’s got the most real estate.”

In response to these claims, James Hamilton, an Amazon VP and distinguished engineer, wrote on his personal blog: “I don’t believe that Oracle has, or will ever get, servers 2x faster than the big three cloud providers. I also would argue that “speeding up the database” isn’t something Oracle is uniquely positioned to offer.”

Read more: Cloud wars: Oracle CEO plans to beat AWS without as many data centres

In essence, Hurd was trying to explain why Oracle had just spent $1.7bn on increasing its cloud data centre capacity in 2016, while the big three (AWS, Microsoft & Google) had spent a combined $31bn.

The comments highlight Oracle talking a good game when it comes to cloud, and while its financial results point to it growing its cloud customer base rapidly, it is still a very long way away from the top players.

Content from our partners
Why the tech sector must embrace faster, smarter talent recruitment
Sherif Tawfik: The Middle East and Africa are ready to lead on the climate
What to look for in a modern ERP system

To put Oracle’s position in the market into some context, Canalys recently reports that AWS along held 33.8% of the cloud market share in 2016, whilst Microsoft, Google, and IBM combined held 30.8% – Big Red’s market share is just 1.7%.

There is of course an argument that the number of data centres that a company has does not directly equate to it having the biggest market share, Microsoft is said to have more than 100 globally but it isn’t leading the market.

Hamilton went on to question just how many data centres will be required by “successful international cloud service providers”, saying that the number will likely be considerably bigger than is deployed today.

Although the providers are likely to be wary of the cost involved in this, Hamilton suggests around $200m for a medium sized data centre, there’s a number of reasons why a large number of data centres is necessary.

Hamilton says that it is “absolutely necessary” to have two independent facilities per region but three is more efficient and easier to manage, despite the most efficient number being one, this is due to redundancy and fault issues.

Moving back to some of Hurd’s points about having a core differentiator in intellectual property, R&D and innovation, Hamilton said that Oracle is, “hardly unique in having their own semiconductor team. Amazon does custom ASICs, Google acquired an ARM team and has done custom ASIC for machine learning. Microsoft has done significant work with FPGAs and is also an ARM licensee.  All the big players have major custom hardware investments underway and some are even doing custom ASICs. It’s hard to call which company is delivering the most customer value from these investments, but it certainly doesn’t look like Oracle is ahead.

In the end, Hamilton says that there is no shortcut and that the only way to achieve excellent world-wide cloud services is to deploy at massive scale.

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.
THANK YOU