Oracle Lets Customers Shift Money To Cloud Apps - InformationWeek

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Oracle Lets Customers Shift Money To Cloud Apps

Oracle unveils new Marketing Cloud and "Customer 2 Cloud" plan that lets enterprises convert on-premises investments to the cloud.

Oracle rolled out its new Oracle Marketing Cloud at a flashy event in New York City on Wednesday night, but it also announced a new "Customer 2 Cloud" plan that will be of interest to a far broader swath of would-be cloud customers.

For those running Oracle Siebel, E-Business Suite, PeopleSoft, or JD Edwards EnterpriseOne applications on-premises, the Customer 2 Cloud plan will let customers "use their existing on-premises support spend to adopt Oracle Customer Experience Cloud and Oracle Human Capital Management Cloud services within the same product family," Oracle said in a statement.

That means those 22% per-year fees spent keeping Siebel deployments running could be shifted to paying for cloud-based alternatives in Oracles Marketing, Sales, or Service clouds. And ERP system support could be shifted to the Oracle Human Resources Cloud or Talent Management Cloud.

[ Want more on more on the competition? Read Adobe Takes On Marketing Rivals. ]

"This program aims to remove the financial and integration challenges that can impact a company’s adoption of these modern innovations and accelerate their journey to Oracle Cloud," said Rod Johnson, group VP, Oracle Applications and Industries Solutions Group, in the statement.

The integration challenges will be addressed by Cloud Express services that will accelerate cloud adoption and by packaged integrations between Oracle's most popular on-premises and cloud applications that will support cloud and hybrid deployment, Oracle stated.

Oracle isn't the first software vendor to enable customers to convert on-premises investments to the cloud. SAP, for example, has previously announced the ability to convert existing licenses to subscriptions. But this is the first plan from Oracle to, as the company put it, "re-direct existing Oracle Applications investments toward Oracle Cloud solutions in a way that strategically makes sense."

Oracle's growing Marketing Cloud incorporates recent acquisitions including BlueKai, Compendium (content marketing), and Responsys.
Oracle's growing Marketing Cloud incorporates recent acquisitions including BlueKai, Compendium (content marketing), and Responsys.

The Oracle Marketing Cloud plan rolled out Wednesday incorporates recent acquisitions including Responsys, BlueKai, and Compendium and older acquisitions including Eloqua and Vitrue. Acknowledging that there are "five or six" big tech companies investing in marketing technology, Oracle senior VP and Makerting Cloud general manager Kevin Akeroyd said the difference in success among these companies will be in the quality of the integrations they can build.

"We can all buy [companies] and say 'I've got more toys on the shelf,' but the best integrator, not the best acquirer, will be the one that extends its lead," Akeroyd said.

It's easy to guess that Akeroyd had Adobe, IBM, Microsoft, SAS, and in mind, but there are plenty of other tech firms, including Infor, Teradata, and SAP, that have at least some investment in marketing technology. Oracle's Marketing Cloud integration work has only just begun, acknowledged company president Mark Hurd in a kick-off speech at Wednesday's event, but he promised deep integration as well as big investments in research and development.

"We're going to drive this business, so we have to continue to add to the depth and breadth of our capabilities," Hurd said. "This is now a big business for us, representing hundreds of millions of dollars in cloud revenue, so it's a material part of Oracle."

Customers including Comcast, Jetblue, Verizon Enterprise, and Wiley media were on hand at the event and shared accounts of improved automation, personalization, clickthrough rates, and conversions using Oracle's technology.  Akeroyd promised that Oracle's integration work would allow customers to "get rid of more than we ask you to invest in," promising an end to disparate and disconnected marketing tools.

Too many companies treat digital and mobile strategies as pet projects. Here are four ideas to shake up your company. Also in the Digital Disruption issue of InformationWeek: Six enduring truths about selecting enterprise software. (Free registration required.)

Doug Henschen is Executive Editor of InformationWeek, where he covers the intersection of enterprise applications with information management, business intelligence, big data and analytics. He previously served as editor in chief of Intelligent Enterprise, editor in chief of ... View Full Bio

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User Rank: Apprentice
5/5/2014 | 2:21:02 PM
Oracle spin not enough to get customers to stay
This is a desperate attempt at preventing customers defecting from Oracle's legacy products to better, true SaaS products such as Salesforce and Workday. Most customers don't trust Oracle's cloud offering for various reasons, one  being that Oracle itself  didn't believe in the cloud for years.  Just because you have a credit for unused Oracle license (by the way, a good question is "why did Oracle encourage us to buy all those products we never used?") does not mean that you will automatically want to move from bad to as bad or worse. What most Oracle customers are doing is taking a step back and saying, "hum, before we embark on an another expensive Oracle project why not look at alternatives?" And when they do, they end up selecting the competition

To understand all that goes on behind the scenes at Oracle, I cannot recommend enough an excellent book, "High-tech planet" written by a former Oracle sales executive. It is a funny, terrific and insightful account of what hides behind headlines-grabbing announcements.  It describes in detail the business atmosphere at Oracle, its sales culture plus a host of shenanigans (financial, fraud, sex etc. ) that will have you shake your head in disbelief unless you work or worked for Oracle.

The first few chapters can be sampled for free on Amazon:
Li Tan
Li Tan,
User Rank: Ninja
5/3/2014 | 11:42:42 PM
Re: The cloud builds in maintenance
The same trend continues across IT industry. Oracle's strong competitor, IBM, has announced its Social Business strategy long time ago. The strategy is encouraging the movement from on-prem OA platform to SmartCloud business. For the customer, instead of paying expensive license fee, the money should be spent on more meaningful stuff, such as cloud service - pay for what you actually use.
User Rank: Apprentice
5/2/2014 | 4:08:37 PM
Integrated Marketing Cloud
"We'd have to agree with Akeroyd that integration is king, and thank you Doug for including Teradata in your list of companies who are doing precisely that. But not just marketing applications.  Teradata has been executing on a much broader vision to integrate warehouse + analytics + marketing applications, all with the customer experience in mind.  Because as you've heard us state before, it's not just about making the technology work together, big data marketing is about the people the data represents."
User Rank: Apprentice
5/2/2014 | 8:39:48 AM
Re: The cloud builds in maintenance
The key benefit to deliver for the customer is predictability in TCO, not just the migration from one system to another.

The changing nature of business - processes, product sets, target customers etc, mean it's typically hard to forecast and budget for a system, which you need to change in order to stay aligned to the business.

But at BPI OnDemand, we've already shown this can be done, with fixed price, zero up-front cost bundle approach. Our Managed Service has been delivering process design, system configuration, user training, ongoing support AND ongoing config changes & report builds, for system migrations and new solutions, all for zero up-front, monthly fee.

It's taken away the unpredicatble capex set-up / migration costs, which only deliver the initial set-up, and replaced it with predictable costs and a managed service that encourages system evolution in-line with company strategy changes.

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Charlie Babcock
Charlie Babcock,
User Rank: Author
5/1/2014 | 7:51:40 PM
The cloud builds in maintenance
This is actually a clever move, and I haven't viewed that many of Oracle's moves to the cloud as that clever. Instead of maintenance, pay for cloud service, where maintenance is built in.
User Rank: Author
5/1/2014 | 2:22:44 PM
Re: Details to come on dollars and options
"Oracle's Marketing Cloud integration work has only just begun, acknowledged company president Mark Hurd in a kick-off speech at Wednesday's event..." Is that music to the ears of And can Oracle compete here with that Salesforce ecosystem? Weigh in, readers.
D. Henschen
D. Henschen,
User Rank: Author
5/1/2014 | 10:02:43 AM
Details to come on dollars and options
The devil is in the details, so I have a follow-up interview planned with Rod Johnson. Presumably your on-premises app will still be supported until you have the cloud version up and running. eBusiness Suite, PeopleSoft, and JD Edwards all have HCM components, but do you have to be using on-premises HCM to shift to cloud-based HCM? Or can any on-prem support spend be shifted to cloud-based spend? Oracle's press release touted flexibility, but if there are lots of restrictions, this isn't going to get many customers to move.
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