Microsoft And Oracle Are Partnering To Take On Amazon Web Services

Jun 5, 2019
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Oracle (NYSE:ORCL) and Microsoft (NASDAQ:MSFT) are teaming up in a newly announced partnership that will allow their respective cloud computing systems to connect via new high speed links between data centers.

The two are working together in order to accomplish one thing: beat Amazon's (NASDAQ:AMZN) dominant AWS offering. Currently AWS, Microsoft Azure, and Google are the three top cloud computing providers by both market share and revenue. AWS booked nearly $26 billion in 2018, Azure is harder quantify since Microsoft doesn't break out Azure from its Office-365 business - but many estimates put 2018 figures around $11 billion for Azure, and Google achieved an annual run rate of a bit over $4 billion for its cloud business.

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Its hard to say where Oracle lands as it groups cloud and license based revenue together under "Cloud Services and License Support", but is widely believed to be in the top-10 providers worldwide in terms of cloud computing.

Microsoft Oracle and Azure now with high speed, seamless links to fight AWS

Microsoft, along with Oracle's help, will be developing and installing direct, high speed links to interface between its Azure data centers and Oracle Cloud data centers. A customer will be able to evenly distribute enterprise workloads across the two services seamlessly.

For instance, a company can use Azure Analytics data to connect to Oracles Autonomous Database. Microsoft claims to be the top cloud choice for enterprise customers and believes Oracle is a natural choice for existing and potential users.

With Oracle’s enterprise expertise, this alliance is a natural choice for us as we help our joint customers accelerate the migration of enterprise applications and databases to the public cloud.

-Microsoft’s cloud boss Scott Guthrie

AWS grew over 40 percent in 2018 and is posting record quarter after quarter for Jeff Bezos & Co. Oracle fears that Amazon is quickly adapting to target customers who require fast and large data bases and a partnership with Microsoft is a move designed to help mitigate the AWS threat.

With this alliance, our joint customers can migrate their entire set of existing applications to the cloud without having to re-architect anything, preserving the large investments they have already made

-Oracle’s cloud VP Don Johnson

Amazon has certainly been growing at a rapid clip in almost all areas of cloud computing. While Google and Microsoft both out-gained Amazon in 2018 on a percentage basis, Amazon out-grew its AWS business in terms of overall value by a factor of two or three versus its chief competitors. Today's announcement between two industry veterans might prove valuable enough to customers desiring a more seamless service offering. Recently some companies have disclosed that they prefer to use more than one provider when it comes to their cloud computing needs, so there might be some real synergies here if companies decide that a single solution based on a Microsoft/Oracle offering is enough to mitigate risk of using a single-provider.

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