In an unexpected move, Oracle announced a partnership with Microsoft Azure days after reporting disappointing Q1 2023 revenues. The partnership focuses on a new offering, Oracle Database@Azure, aimed at combining Oracle's powerful database services with Azure's robust cloud infrastructure.
The unique aspect of this offering is the co-location of Oracle's hardware and software within Azure data centers. Oracle CEO Larry Ellison emphasized this during a joint press briefing with Microsoft CEO Satya Nadella, noting that this will be a "fully integrated" experience.
With the partnership, Oracle seeks to halt its shrinking market share. According to Gartner, Oracle’s database market share declined from 36.1% in 2017 to 20.6% in 2021. The new venture aims to offer a seamless and more flexible solution to enterprises, directly challenging competitors like AWS, PostgreSQL, MongoDB, and MySQL.
Oracle Database@Azure will support Oracle Exadata Database services, Oracle Autonomous Database services, and Oracle Real Application Clusters. The offering comes with a joint support guarantee from both Oracle and Microsoft.
Both Oracle and Microsoft believe this move responds directly to customer needs for integrated solutions. "This will fundamentally accelerate the migration to the cloud," said Nadella. The service will initially roll out in North America and Europe.
Despite the strategic alliance, Oracle has its work cut out. The loss of big clients like AWS and Salesforce signifies the uphill battle it faces. The company previously made its database software free for developers in an attempt to gain goodwill, but whether Oracle Database@Azure can turn the tide remains to be seen.
In joining forces with Microsoft, Oracle aims to leverage Azure's extensive reach and capabilities to rejuvenate its declining database services. However, the true test will be whether this partnership can convince longtime clients and new customers to adopt Oracle Database@Azure for their cloud-based needs.