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June 24, 2013 at 12:38 PM

Microsoft and Oracle announce cloud partnership

After Oracle CEO Larry Ellison spilled the beans during an earnings call last week, Microsoft and Oracle, as expected, announced a cloud partnership today.

Specifically, the partnership means that customers will be able to run Oracle software (including Java, Oracle Database and Oracle WebLogic Server) on Microsoft’s Windows Server Hyper-V or in Windows Azure, with certification and full support from Oracle.

Microsoft also will be offering those Oracle software to its Windows Azure customers, while Oracle will make Oracle Linux available to Windows Azure customers, according to a press release from the companies.

“Microsoft is deeply committed to giving businesses what they need, and clearly that is the ability to run enterprise workloads in private clouds, public clouds and, increasingly, across both,” said Microsoft CEO Steve Ballmer said in a statement. “Now our customers will be able to take advantage of the flexibility our unique hybrid cloud solutions offer for their Oracle applications, middleware and databases, just like they have been able to do on Windows Server for years.”

There are already many customers that run Oracle software on their on-premises Windows Server. Today’s announcement “is about extending that to the cloud,” said Satya Nadella, head of Microsoft’s Server and Tools division, said in a conference call following the announcement.

The partnership looks to be a good move for both companies, while being bad for mutual competitor VMware, said veteran Microsoft and Oracle analyst Rick Sherlund, of investment bank Nomura.

“I think they need each other,” Sherlund said. “They’re cooperating in areas that are mutually beneficial.”

Microsoft is getting Oracle’s support for Hyper-V, Microsoft’s hypervisor technology, which allows companies to run virtual servers. That’s important because Hyper-V competes against VMware, which is dominant in the server virtualization market. And many of the businesses that would be interested in such technology already use some Oracle software.

“It’s an advantage for Microsoft to be able to say: ‘All this Oracle stuff runs on Hyper-V,’ ” said Sherlund, who added that Oracle does not support VMware’s vSphere.

The move likely also allows Microsoft to say it’s being open with its Azure platform.

“That’s the rap you have against Microsoft: That it’s all the Microsoft platform,” Sherlund said. “If you’re in the cloud, it’s good that you’re supporting other platforms.”

Oracle, meanwhile, has traditionally delivered its software to its customers’ own premises. Now that it’s focusing more on delivering its software as services, it’s “motivated to make sure that [the services are] available on a lot of different cloud platforms,” Sherlund said. “So that’s good for Oracle.”

Microsoft and Oracle have long competed in providing some of the same services, including databases and server products.

They were bitter rivals through the 1990s and, indeed, Oracle was a strong critic of Microsoft’s monopoly on operating systems during the government’s antitrust lawsuit against Microsoft. At one point, Oracle acknowledged hiring a detective agency to monitor Microsoft’s political activities to expose “Microsoft’s ‘underhanded attempts’ to win its antitrust case,” according to a CNNMoney report.

Then-Microsoft CEO Bill Gates, meanwhile, contended that the government’s antitrust suit was spurred by the company’s competitors, including Oracle, Sun Microsystems (later bought by Oracle) and IBM.

But these days, both companies are battling newer, nimbler competition from the likes of and Google.

Ballmer and Oracle President Mark Hurd said during the conference call after the announcement that their two companies would continue to compete.

But, Ballmer said, “the relationship between the two companies has evolved … in a very positive and constructive manner on a number of fronts.”

According to Hurd: “The cloud is the tipping point that made this all happen.”

Hurd said Oracle would continue to offer its own public, private and hybrid platforms. But the fact that Java will be accessible to programmers who work in Windows Azure “is a good thing for us. … The fact that more people get access to our IP is favorable,” he said. “It’s good for our customers and therefore good for Oracle.

Oracle CEO Ellison had also said last week that the company would be announcing partnerships with and NetSuite.

Comments | More in Microsoft | Topics: java, oracle, windows azure


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