Ellison: Database Machine Will Need Time to Fly
Customers are showing rampant interest in Oracle's recently announced products for high-end data warehousing, but it will be some time before that enthusiasm makes a significant impact on the vendor's bottom line, CEO Larry Ellison said this week.
Ellison unveiled the HP Oracle Database Machine and the HP Oracle Exadata Storage Server at Oracle's OpenWorld conference in September, following a wave of hype and speculation. The products combine Oracle's software and ProLiant servers from Oracle partner Hewlett-Packard.
Since then, the buzz has been big, Ellison said Thursday during a quarterly earnings conference call. "As measured by pipeline growth and pipeline size, this is the most successful introduction of a new product in Oracle's history," he said.
However, he said "it's going to be a while" before Oracle can convert that buzz into solid sales of the product.
Still, the Exadata business "looks very, very promising and should help us drive growth over the next 18 months," Ellison said.
Ellison said a number of demonstration machines are in the hands of customers, but it was unclear whether any companies are now using the products in production. Spokeswomen for Hewlett-Packard and Oracle could not immediately provide an answer to that question Friday.
"It doesn't surprise me that Oracle didn't name any specific customers on an earnings call, and that's because it was an earnings call, not a product announcement or customer-win or testimonial call," said Forrester Research analyst James Kobielus via e-mail Friday. "Don't interpret that as any slap against the new HP Oracle appliance, which is a strong product with considerable customer and market interest."
Oracle and HP also released the product in the middle of an economic recession, "so it may take some time to make those pipeline conversions," Kobielus said.
The new products are going up against the likes of Teradata, Netezza and Greenplum, the last of which announced NYSE Euronext as a customer this week.
During his keynote address at OpenWorld, Ellison had tart words for those competing products, but such boasting could be premature, suggested Curt Monash, founder of Monash Research.
"Until there are some major production Exadata success stories, it remains less proven than a number of smaller vendors' alternatives," Monash said via e-mail Friday. "Oracle will find Exadata pioneers anyway, of course, but not necessarily a huge stampede of them."
Greenplum's president, Scott Yara, echoed Monash in an interview Friday.
"Oracle and HP are two great companies, but it's not a guarantee for success in the market," Yara said. "They're going to sell Exadata. Whether they're going to be the leader is another question. ... I think Oracle personally has a lot to prove."