The tranquil waters of Lake Colorado, just steps from his offices, glide along the shores. A few Virginia oaks stretch out their branches. But you have to be wary of sleeping water. Based in its new headquarters in Austin, Oracle is preparing for the future of its software in the cloud era. Historically based in California, the company moved to Texas last year, to the shores of Lady Bird, one of the downtown reservoir lakes. Under the large opaque windows of the building, the sales teams are already working.
The purchase of this huge campus reveals the ambition of the group, already valued at 200 billion dollars on the stock market and employing 132,000 people around the world. Founded by Larry Ellison, the leader in management software has tackled the cloud market by investing 12 billion dollars in two years to catch up. A strategy that is beginning to bear fruit. « Oracle’s two cloud activities now represent 25% of its turnover with an annual rate of 10 billion dollars », explains Safra Catz, its CEO since 2019. The former financial director has raised the margins of the company and set a clear course. “At the end of the year, we should go from 37 to 44 data centers worldwide,” explains Régis Louis, one of the pillars of this strategy in Europe and Asia-Pacific. The vice-president wants to make Oracle one of the main players on the continent. After Marseille, a second data center will be inaugurated on June 20, in Ile-de-France.
Oracle’s name has long been associated with its management software and databases. Large enterprises turn to Oracle to bring order to their financial, accounting, and human resources data. An area where competition has increased since the appearance of Salesforce or Workday and the rise of German SAP applications. Enough to force Oracle to multiply acquisitions like that of Cerner, the medical data manager, in December, for 28.3 billion dollars. Its biggest operation since the takeover of PeopleSoft in 2004.
Diversify your income
During the latest results, in March, Larry Ellison was pleased to have brought in new customers, including banks like Société Générale and soon BNP Paribas. In France, Oracle boasts of having consolidated Crédit Agricole’s financial data on the bank’s servers. An approach put forward by the group, which claims to be able to run its software on the customer’s premises as well as on its servers – in this case, Sun Micro-systems, acquired by Oracle in 2010. « Our customers’ data will always remain kept in the data center of their choice », maintains Christophe Négrier, appointed in January director of Oracle France.
But, to grow even bigger, the giant also wants to house the digital gold in the safes that it deploys everywhere. « Oracle would like to take some of its customers to its own infrastructure, » observes Gérald Karsenti, former director of Oracle France, who left the company before moving to SAP. A strategy that would allow it to be more agile and diversify part of its income. « Oracle left later than the others in this activity, confirms Chris Pang, an analyst at Gartner. In terms of market share, its cloud activity in 2020 remained behind (1.5%) hyperscalers such as Amazon’s AWS ( 41%), Microsoft’s Azure (20%), or Alibaba (10%). »
Proximity to Trump
The group conducts powerful lobbying in Washington against the monopoly of its competitors. Four years ago, he had filed a complaint against the Pentagon after the awarding of a 10 billion dollar contract to Microsoft for the project of a military cloud, « Jedi », promoted by the Ministry of Defense. The contract was thus renegotiated with four suppliers… including Oracle.
Close to Donald Trump, Safra Catz and Larry Ellison claim their support for the Republican Party, mixing politics and business… When the ex-president instructs the Chinese network TikTok to store his data in the United States, in 2020, Oracle puts itself on the ranks to win the contract against Microsoft. After many adventures, its public cloud could well host the famous data of American users, confirmed the Reuters agency, last March.
“We remain one of the last tech companies run by its founder,” recalls Christophe Négrier. Larry Ellison has been driving it for over forty years. Eighth richest in the world according to Forbes, he holds 42.7% of the shares of Oracle where he still exercises as « chief technology officer » at 77 years old. Investing also in regenerative medicine, the billionaire does not hide that he would see himself immortal.
A golden breeding ground for the tenors of tech
Is going through Oracle enough to fill out a business card? The former members of the group form a special clique in the world of tech. The two French engineers from Snowflake, Thierry Cruanes and Benoît Dageville, can testify to this. After spending ten years at Oracle, the stock market listing of their company, worth $67 billion, set Wall Street on fire two years ago. They joined the group of founders who, like Marc Benioff, the boss of Salesforce, or Bernard Liautaud and Denis Payre, with Business Objects, created their own company after having studied with Larry Ellison.
Oracle alumni are also a godsend for its competitors. In 2019, Google Cloud went to find Thomas Kurian after twenty-two years as President of Oracle to entrust him with the management of its activity. More recently, Palantir imitated him by poaching Philippe Mathieu from Oracle International to develop its products in Europe and the Middle East.
STRATEGIC TURNING POINT
1977 Larry Ellison founds Oracle.
1987 World leader in database management software.
2014 Larry Ellison hands over his CEO seat to the duo Mark Hurd and Safra Catz.
2019 Safra Catz becomes CEO of Oracle Corporation.
2021 Acquisition of Cerner for $28 billion.
Austin, a new digital stronghold
How much will it cost us? – Certainly less than in California, replied Larry Ellison (opposite, next to Safra Catz) to its CEO Mark Hurd, who died in 2019, about the location of the campus, according to the Business Journal of Austin. The 14 hectares will soon accommodate 10,000 employees, a flag football field, sports halls and luxury accommodation for young executives recruited right out of university. A $300 million project. After Microsoft, Apple and Google, Oracle moves to Austin.
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