A Silicon Valley stalwart wants to change direction. Will it work?
LARRY WHO? A few weeks ago asking a young tech worker in Silicon Valley about Larry Ellison, co-founder, former boss and now chief technology officer of Oracle, might have elicited blank stares. More surprising, given that his company is still the world’s second-largest software-maker, a follow-up question might have been: “Remind me what Oracle sells?”
Being treated like a has-been must have irked the 76-year-old Mr Ellison. In Oracle’s heyday 20 years ago he was Silicon Valley’s best-known rogue billionaire—yesteryear’s Elon Musk. “The Difference Between God and Larry Ellison”, one of the many books written about the firm and its colourful founder, was subtitled “God Doesn’t Think He Is Larry Ellison”.
被人像过气人物那样对待一定让76岁的埃里森很恼火。在20年前甲骨文的鼎盛时期，他是硅谷最出名的怪咖亿万富翁，好比如今的伊隆·马斯克。有许多书籍讲述甲骨文和它有趣的创始人的故事，其中一本名为《上帝与埃里森的不同》（The Difference Between God and Larry Ellison），副标题是《上帝不认为自己是埃里森》（God Doesn’t Think He Is Larry Ellison）。
Now he and his firm are back in the headlines, thanks to something that, in software terms, is about as far from Oracle’s bread and butter of corporate databases as jelly beans are from white toast. Its deal to team up with TikTok has made its brand recognisable even to many teenagers—the main clientele of the Chinese-owned video-sharing platform. Whether the notoriety lasts more than 15 seconds, the length of a typical TikTok video, is another matter.
Attempts at reinvention are nothing new in Silicon Valley. It can be made harder by lucrative legacy businesses; just ask IBM, another once-great information-technology (IT) giant that has been sliding into irrelevance. Oracle would rather emulate Microsoft, which has ridden the cloud revolution to a market capitalisation of $1.6trn and stellar returns (see chart). The TikTok arrangement, which would see Oracle host the app’s data in its cloud, confirms that is Mr Ellison’s plan. Like the transaction—which could yet be blocked by President Donald Trump—Oracle’s metamorphosis is not, however, a done deal just yet.
Since its founding in 1977 Oracle has been the odd one out in Silicon Valley—less focused on inventing the next new thing and more on signing the next big contract. By the mid-1990s it dominated the market for “relational” databases, which underlie corporate applications from book-keeping to supply-chain management. After the dotcom crash in the early 2000s it used its pile of cash and high share price to consolidate swathes of the IT industry. Within a few years it acquired several software rivals, including BEA Systems and PeopleSoft, as well as Sun Microsystems, a maker of powerful computers. It is still hard to find a sizeable firm that does not send a cheque to Oracle’s snazzy headquarters in Redwood City. With customers locked in by the sheer tedium of switching databases, Oracle could extract huge profits. In its last financial year the company earned a net income of more than $10bn on revenue of nearly $40bn.
自1977年成立以来，甲骨文在硅谷一直是个异类——不怎么在意发明“下一个新事物”，而是努力签下下一份大合同。到90年代中期，甲骨文已称霸“关系”数据库（是从簿记到供应链管理的企业应用程序的基础）市场。本世纪初互联网泡沫破裂后，甲骨文利用自身充沛的资金和高股价在IT行业里大肆并购。短短几年内，它收购了多家对手软件公司，包括BEA系统（BEA Systems）和仁科软件（PeopleSoft），还有高性能计算机制造商太阳微系统（Sun Microsystems）。现在仍然很难找到哪家规模较大的公司不需要给甲骨文位于雷德伍德的时髦总部献上支票。转换数据库异常繁琐，客户就此被锁定，凭这一点甲骨文可以赚取丰厚利润。在上个财政年度，该公司的营收接近400亿美元，净收入超过100亿美元。
Success in old IT was a big reason why Oracle was late to the new sort: cloud computing. Mr Ellison long dismissed it as a faddish label for existing technology. By the time he realised it was an epochal shift in IT, Oracle had fallen behind. Oracle Cloud Infrastructure (OCI), as it calls its offering, is said to have sales of less than $2bn annually, compared with more than $40bn for Amazon Web Services (AWS). The e-commerce titan’s market-leading cloud unit is valued at several times Oracle’s market capitalisation of $178bn. Cloud-based rivals of the sort that Mr Ellison once dismissed, such as Adobe and Salesforce, are worth around a quarter more than his firm.
在传统IT业里的成功是甲骨文在云计算这一新领域落后的一大原因。在很长时间里，埃里森都认为云计算不过是给现有技术贴上一张时髦标签而已。当他意识到这是IT业的划时代变革时，甲骨文已经落后了。据称，甲骨文云基础设施（Oracle Cloud Infrastructure，以下简称OCI）的年销售额不到20亿美元，而亚马逊云服务（以下简称AWS）的年销售额超过400亿美元。这家电商巨头的云计算部门引领市场，估值是整个甲骨文市值（1780亿美元）的几倍。埃里森从前不屑Adobe和Salesforce等基于云计算的竞争对手，而如今它们的市值比甲骨文高出约四分之一。
Even in databases, Oracle’s core business, the world has moved on. For many new applications, such as customer-facing websites, its tools are too expensive and inflexible. Recent years have seen the rise of more specialised digital repositories, many of them in the cloud and based on malleable “open source” software. According to Gartner, a research firm, Oracle’s share of the database market fell from nearly 44% in 2013 to 28% last year. And it has yet to shake off a reputation for antagonising clients with things like audits to verify their use of software by workers—and hefty charges for firms that exceed licence limits. Brent Thill of Jefferies, a bank, echoes other Oracle bears when he says that the company has been stuck for years even as “we are living in the data age, the biggest tech-boom ever.”
Seers of a brighter future
Oracle optimists counter that the firm has a few things going for it. One is management. The death last October of a co-CEO, Mark Hurd, left Safra Catz as the woman in charge. She is widely considered an effective operator. Mr Ellison, who stepped down as chief executive in 2014, has in recent years taken a more active role in product development—considered his forte—without treading on Ms Catz’s toes. The upshot, says Ted Friedman of Gartner, is better technology such as the “autonomous database”, which uses artificial intelligence to automate work once reserved for human IT administrators. For example, it allows software updates to be installed without shutting systems down, a dreaded procedure which can go badly wrong.
看好甲骨文的人则反驳说这家公司仍具备一些优势。一是管理。去年10月，甲骨文的联席CEO马克·赫德（Mark Hurd）去世，留下女CEO萨弗拉·卡兹（Safra Catz）独当一面。外界普遍认为她是个能干的经营者。埃里森在2014年卸任首席执行官，近年来更多从事产品开发这项被公认是他强项的工作，不干涉卡兹的管理。高德纳的泰德·弗里德曼（Ted Friedman）表示，这样的结果是甲骨文能开发出像“自治数据库”这样更好的技术。这种数据库运用人工智能自动完成以往需要人类IT管理员完成的工作，比如无需关闭系统就能完成软件更新，避免了可能严重出错的令人生畏的一步。
OCI enjoys the latecomer advantage in the cloud, says Clay Magouyrk, one of its leaders. “We did not have to take the circuitous path others had to take to get it right,” he says. Mr Magouyrk points to Oracle’s next-generation cloud platform, which will, among other things, offer hundreds of local sub-clouds that let customers keep their data close to home, as privacy regulations may require them to. In April Zoom, a videoconferencing service, opted for OCI to help it manage pandemic-fuelled growth (mostly because Oracle charges less for the use of its networks). Landing the TikTok contract would be another boost: the video app spends an estimated $1bn annually on cloud-computing services.
甲骨文高管克莱·马古伊克（Clay Magouyrk）认为OCI在云计算方面享有后发优势。“我们不用走别人为了找到正确方向而不得不走的那些弯路。” 他说。他以甲骨文的下一代云平台为例。该平台将提供的诸多功能之一是成百上千的次级云，能让客户就近保存自家数据，因为隐私法规可能会要求它们这么做。今年4月，视频会议服务商Zoom选择使用OCI来帮助管理因新冠疫情而增长的业务（主要是因为甲骨文的网络服务收费较低）。若能得到TikTok这份合同，将会是另一个提振：该视频应用每年在云计算服务上的支出约为10亿美元。
A bigger opportunity for Oracle lies in cloud-based applications. It has begun converting some of its existing customers to these programs, which are more sophisticated than the basic computing and storage offered by AWS and OCI, observes Mark Moerdler of Bernstein, a broker. The company’s bundle of cloud-based services already accounts for 8% of its software revenue; sales have been growing by more than 30% a year.
The wild card is Oracle’s political bets. The firm has positioned itself close to Mr Trump. In 2016 Ms Catz served on the president’s transition team and this year Mr Ellison hosted a fund-raiser for him. This did not help them win a lucrative cloud contract with the Department of Defence; OCI was not technically up to snuff. But being in the White House’s good graces may have helped Oracle beat Microsoft (which won the Pentagon contract) to the TikTok deal. If the deal succeeds—a big “if”—Oracle’s cloud may emerge as a digital haven for companies seeking to reassure Washington that their data are safe from prying Communist eyes in Beijing amid the Sino-American tech cold war.
It is, then, too early to write Oracle off. When a group of youngish cloud-services CEOs recently met reporters on a Zoom call, they were unanimous in their assessment. Jennifer Tejada of PagerDuty, which helps firms manage IT incidents, summed it up: “You have to respect Oracle for finding ways to keep itself relevant.” Relevance is not the same as fast growth, which may prove elusive given competition from AWS and others. But it is better than the digital dustbin of obscurity.■