 Live from San Francisco, extracting the signal from the noise. It's theCUBE, covering Oracle OpenWorld 2015. Brought to you by Oracle. Now your hosts, John Furrier and Dave Vellante. Okay, welcome back everyone. You are watching Oracle OpenWorld exclusive coverage from SiliconANGLE Media is theCUBE. theCUBE is SiliconANGLE Media's flagship program. We go out to the events and extract the signal from the noise. SiliconANGLE has SiliconANGLE.com publishing, SiliconANGLE.tv, theCUBE, that's our TV operation. And of course, wikibon.com, that's our research team. And of course, crowd chat, crowd pages and data science all under the covers. We are here for the wrap up for Oracle OpenWorld. This is day four. We've been here since Sunday at noon, breaking it down end to end. We've seen everything Dave, 47 segments, keynotes, pregame, postgame keynote coverage. It's been a great run, just really fantastic and surprising to me to see how far along Oracle has come. It's almost as if they've been hiding the ball for years and all of a sudden they open the kimono and here it is. Not hiding the ball in a negative way, but in plain sight, kind of like keeping their march down and then bang, they're in the cloud business with numbers. Well, let's go back to the Churchill Club. Think about how people misinterpreted Larry Ellison's statement at the time when Ed Xander started asking him about cloud and there's Larry finished his thought. Are we screwed because of cloud? No, cloud is microprocessors and database and operating systems and disk drives, et cetera, et cetera, et cetera, people started laughing. The inference was, oh, Oracle's poopooing cloud. In reality, at the time, I firmly believe this, Larry Ellison had a vision and that vision was to put hardware and software engineered together, put it into the cloud, make a homogeneous cloud and compete. And the thing to really underscore about Oracle OpenWorld is the consistency of message. And you're not seeing start, stop, start, stop. You do see a lot of pre-announcement. That's kind of what big companies do, but you're seeing a lot of consistency. Hardware and software engineered together, homogeneous experience on-prem and in the cloud and it just keeps getting bigger and bigger and, in my opinion, stronger and stronger. And you know that Larry Ellison, Churchill Club famous video that everyone in the industry has probably watched, had a little other nuance in it, I want to share with you. He made a comment about the disruption and the startups and then he's like, those knuckleheads on Sand Hill Road. Nitwits. Nitwits on Sand Hill Road referring to the venture capitalist, right? Really, ultimately, it was a total diss. And now if you look back at Larry's statements, because I like what you said, it's totally true. It's running data centers, the cloud is the cloud. They got a box, cloud in the box now. Okay, that's cool, but of all the winners in the cloud, which one is VC-backed? Zero. Well, what startup? I guess Amazon was VC-backed, but that was early days, not AWS. In terms of start, they were funded eventually by a VC, so it was Oracle, I'd be VC money. But I mean, like in that phase of the Churchill Club, what came out of that crop of, quote, cloud's gonna take over? No one disrupted anything, it's Microsoft, it's Google, it's Amazon and Oracle, right? And some other guys, it needs to be an IBM, but Dell, my point is, the startups never took over. You could argue Facebook is his own cloud, but he was right, Larry Ellis was right. The other thing that's interesting is that, go back five years at Oracle Open World, it was our first one in 2010, we were down on the show floor, and I commented to you, I'm like, Dave, it's like an eye of the hurricane here. It seems dead on the floor. It's like a bunch of zombies walking around. What's Oracle gonna do? Because they knew Fusion was under development. Larry was on stage almost with not enough bullets in his gun, right? Like deer in the headlights, he almost like fumbling through this pitch, and it's like, no, the air is coming. That next year from that Oracle Open World from 2010, Oracle Open World 2011, 12, 13, 14, now 15 have been really amazing transition. That next year we commented on in 2011 at Oracle World, the energy's back, that was the big story. Wow, energy's back, people got a spring to a step. Larry's going crazy in the Mark Benioff Boycott keynote. And then the next year, oh my God, they got a cloud store all, he's back in the cloud game. And then since then, just performance across the board. So Oracle, it's not like they woke up one day and said, we got to do the cloud. Well, so Larry looked good to me. I mean, he looks fit, he's funny, he's self-deprecating. You know, his eyes are going a little bit, he makes jokes about that. Whose is it, right? What's that? Yeah, that's really. Yeah, right, right. You know, he's funny like that. The only thing I would say, John, is a couple years ago when Larry didn't show up for the keynote because he was celebrating with the victory, the America's Cup, it was sort of this vacuum. He was like, oh wow, what's the world going to be like when Larry goes? So this, the succession plan is interesting. You know, a lot of rumors float around out there, but that's, you know, hopefully a long ways off because Larry seems really energized and the strategy is crystal clear. I've always said, it's like he names products. His company strategy is the same way he names products. The zero data loss recovery appliance, the Oracle appliance for cloud infrastructure service and platform service. You know what you're getting. The strategy is crystal clear. He's kind of got the HP kind of mentality going on. What would he call sushi? Cold dead fish. Cold dead fish is what it is. You got to be careful, but I get what he's doing. But Dave, I got to ask you a question because this is now the big story in this industry, the consolidation. Founder led companies are always doing well. Larry Ellison with huge admiration for him. I can't wait to have him on theCUBE. I think he'd do great in theCUBEs. That's one thing. Michael Dell now owns EMC. So he's got a lot of toys. Larry's got a bunch of toys from boats now to sun's blooming. So I got to bring this up. To me, the competitive advantage going forward will be the new big players, management team. I think one thing that's not being talked about is the strength of the management team of the companies competing with the big resources. Okay, or the big boats. Look at them, or look what Ellison's got. Donna Telly, Mike Workman, Sean Price. I mean, the list goes on and on. The people that we've been interviewing here have been iCalibur executives. We talked to the technologists. They know what they're talking about. They're not lightweights. Look at Dell, Michael Dell, founder led. He's in charge, Marius Haas. Bunch of slew of great managers over there, Dave. So they got some. They got the EMC, Jeremy Burton, Goulden. See those formidable management teams. I want to get your take. Do you see the same trend? And who stack ranked the management teams out there? Look at the teams out there that have the good management teams that will win. Well, I think Oracle's got a great management team. I think IBM has a very strong management team. I've always felt that EMC has a strong management team. My big question about the Dell EMC acquisition is can they keep the best people? Because you know Donna Telley's going to be calling all his friends and folks at HP are going to be calling up people from EMC trying to poach them and capitalize on uncertainty. He's going to be poaching on it. Yeah, I mean, I think I'm very impressed with what Microsoft's doing. I mean, look at Salesforce. I mean, Salesforce is really getting it done. I mean, they are growing fast. You're saying, yeah, you're making, okay, but the company's crushing it. I mean, you don't like Salesforce. You're not optimistic about Salesforce's future. I mean, I think that I see them as a SaaS player, but I just don't see them extensively. A lot of hodgepodge, and I need to learn more, but you know, Mark Benioff, I see him on Twitter. He says he's gaining share. Well, he's growing. I just don't hear about Salesforce. I mean, I don't hear about them innovating. I don't hear. It's a $5 billion company with a $50 billion valuation. I mean, that's impressive. I know, of course you hear them. It's because of the growth. Of course you hear them, but I of course you hear Salesforce. But I don't hear people saying, man, Salesforce has got some kick-ass engineering. I don't hear that. I hear more of that in Oracle. Now, Oracle's got maybe more aggressive dogma on that, but we talk to the people over here, you know? Well, so let's, you know, I did a little research here before we came out. Let's look at the players, right? As we were talking earlier about, are we screwed in cloud because of cloud? So Oracle's a $40 billion company with a $160 billion market cap. Ford, they trade at four times revenue, which is pretty good. What's VMware trade at? VMware, pure software company, four times revenue, much, much smaller than Oracle. Cisco, three times. IBM, one and a half times. Salesforce, 10 times. EMC, two times. HP, one and a half, 50 cents on the dollar. So Oracle is right there. Microsoft, four times revenue multiple. So Oracle has a business model, John, that includes hardware, but yet it gets software-like valuations because of software marginal economics. To me, that's a huge advantage. The question is, what's Amazon web services worth? You know, what would their valuation be if they were a separate company? If they broke out, I mean what? Almost $10 billion in revenue. $500 million in profit last quarter? I would say there would be at least a $50 billion valuation on their way to 100. So that's kind of an interesting- This is what's interesting. We have heard some coming about Larry's strategy. The conventional wisdom right now is to break apart, go private and have components. Larry's actually doing the opposite of what Ernest is doing. 180. And I said, I said down, this is before Steve Jobs passed away. We were actually, he passed away actually at one of the Oracle openers I remember being, getting the news while breaking down. The year before, I said to you, and we talked about this in theCUBE, Larry Ellison wants to be the Steve Jobs of the enterprise. Okay, that was a quote that I had put on theCUBE that was 2011, the timeframe. If you look at Apple, they just did a $51 billion quarter with 11 billion net income. Profit, okay? Apple, one quarter, 51 billion in revenue, 11 billion in profit in one quarter. So your premise is Larry's trying to replicate that in the enterprise? He's absolutely doing it. He's actually creating inevitability in creating a barrier to defend his position by integrating, and that's clearly using technology and muscle, forget the sales motion muscle, and that people throw their rocks at them on. He's actually building differentiation by creating inevitability and nestedness between software and hardware. That is what Apple did. Mike Workman was waving his phone around out and saying, look at this, do you care what's in here? Right, so it brings, I agree with him. So it brings me back to cloud, because despite what Larry said at the Church Club, cloud is actually the big disruptor. So an Amazon is the big disruptor. They are, they to me, that cloud is the reason why Dell and EMC are happening. EMC, you know, Joe Tucci loves to talk about the waves. The waves got too gnarly. Couldn't ride them. Pat Gelsinger's quote, you're going to become Driftwood if you don't, you know, straight out of the wave. So the point I want to make is there's two ways to compete with Amazon, and I know I've kind of sounded like a broken record on this. You either have to have massive volume like Google and Microsoft, or you have to have differentiation up the stack. Clearly Oracle has chosen the latter. It's got differentiation up the stack. And so the question is to Dave Donnelly's point is if you don't have a public cloud strategy, you're in trouble. I think I would say it differently. If you don't have a public cloud strategy, you either have to be low-cost commodity supplier, or you have to have volume, massive volume. Here's how I compete with Amazon. If I was on Larry's right hand man saying, hey John, how would I compete with Amazon? Very clearly. Do not go frontal on them. Change the game and pull them on your strength turf. That's the enterprise. And that's what you hear. I'm going to solve business problems. I would commoditize. I would burn the village and just drop the nukes on Amazon by meet all their requirements straight up, which they're doing, right? We heard Praveen and these guys saying, well, these guys said, well, cloud is disruption only in two areas. Has nothing to do with the hardware. If you assume that there's a black box that's encapsulated away, it's consumption of the service, okay? And the developer platform and how it runs. Those are the only two things. Where the box is located, that's irrelevant. So strategy-wise, there's no question that Oracle has the cleanest strategy of any enterprise player. No question, in my opinion. Now, in terms of execution, I mean, you were at re-invent. You saw the innovation that's coming out of there. You saw the flywheel in action. I mean, Amazon is way ahead of the competition. Any competition in public cloud, including Oracle. On pure play public cloud, I would 100% agree with you. For Oracle customers, I would disagree with you. No, I'm not saying for Oracle. I'm just talking about pure play public cloud. No doubt, no doubt. So I'm just comparing the two. Now, so why would it always be, I'm reacting to the point of, take Amazon head on and burn the village. It's very difficult for Oracle can talk about pricing. Oracle just doesn't have the number of services that Amazon has in the public cloud. Having said that, it doesn't have to. What it has to do is deliver that homogeneous experience on-prem and off-prem. Let's use a sailing analogy. Oracle wants to win the race, right? They want to win the big pie. So Amazon wins just by being in the game. They got a boat in the race. So the fact that they're, you know, boat lengths behind Oracle relative to the acquisition of customers, doesn't matter. I mean, I don't think, I wouldn't care about Amazon. I'd be like, hey, you know what? Let them have some, a boat in the race as long as we win their deal. So Donald, Donald tell you, I think it was Dave said count them on one hand, the number of cloud players, right? Okay. It has to be Oracle. Who are they? Amazon, Google, Microsoft, Oracle. I'll put Oracle in there. Oracle is not going away. Oracle has to be in the top three. Who's number five? Larry will not be happy. IBM, VMware? So I put IBM ahead of VMware and cloud because they got applications. They got, I'll let the analysts slice and dice that, but on pure play. Well, that's what we're doing. We're being an analyst. Yeah. I mean, I think. Oracle's definitely in that. I mean, if I'm Larry Ellison. Would you agree that Oracle's in that five? Yes, absolutely. But I think they got to get more aggressive. I think if I'm Larry Ellison, I say to my leadership team on the technology side, which is Korean and also Mark Herd. Look, I want to be in the top two. Okay. And number one, why not be number one? The one thing that gets lost in all this discussion is all the SaaS guys. What about Salesforce? What about service now, you know? Workday, you know? Well, that's why I think the ISV communities. What SAP? I think that the opportunity for venture capital and startups is to have that software model build on the critical infrastructure that has Oracle and just use their platform as a bully pulpit to just suck the market up. And I think that is going to be monetization. It's going to be developer community. So I think there's going to be in the next decade an application explosion. Okay. And when I say that, I mean DevOps, the cloud native stuff we're talking about. Docker, real time, new apps, specialty apps. And I think service now teases that out for us at their last event. We saw guys writing these boutique apps, very narrow in scope running on service. No, because it's HR related. So kind of a new form of paths coming out of service now. So the new features are going to roll in via developer community. So I think that's a huge. I liked, but I do, I do like Oracle's messaging that look price wise, we're going to be competitive with Amazon and infrastructure as a service. Functionality, you want to run Python? You want to ride, ride, you know, run Joe, Joe? Well, we got to get wrapped up. We're getting the wrap here, Dave, and a great run. I think that my summary of the show is it's a new Oracle. They're putting on a new face to bring in developers in. They got a management team that's rocking and rolling and they got new toys, new engine. I call them the Tesla of cars now, of IT. If they can get this going, get this engine up and make sure this car doesn't crash. I think if they can pull this off, it's going to be a great run for them and a great, great event. Certainly great to be here in Howard Street here at Oracle Open World. This is the CUBE coverage. Go to siliconangle.com for all the publishing and all blog posts for all of our coverage on the videos, go to siliconangle.tv or youtube.com slash siliconangle and go to wikibond.com for all the research and just stay up to date on all the action of Oracle and all the analysts over there doing a great job. And of course, all the content from the crowd at Oracle Open World, a social network that we put together, as well as all the videos is at crowdpages.co slash o-o-w-15. This is the CUBE signing off from Howard Street. See you next time.