Abu Dhabi: Oracle is planning to open its first cloud data centre in Abu Dhabi this year as it bids to keep pace with its growing customer base in the Middle East.
The Abu Dhabi cloud data centre will be the tech company’s 22nd centre globally.
The US company also plans to increase its sales resources in the region by hiring more than 250 sales professionals from the UAE.
The move comes as the company has more than doubled its workforce in the Middle East in the past three years, two years ahead of predictions.
In the course of 2016, Oracle plans to open new offices in Abu Dhabi, Dubai Internet City, Amman and Riyadh.
Mark Hurd, CEO of Oracle, who was in Abu Dhabi on Tuesday, told Gulf News that cloud opportunity for Oracle is huge. Seventy per cent of Oracle cloud customers are new and have not used licensed Oracle software before.
When asked whether Oracle will stop support for on-premises (customers’ servers) as the focus is on cloud, Hurd said that Oracle’s portfolio was both on cloud and on-premises.
Even though the applications and customers are migrating to the cloud, “we will keep supporting the on-premises licences as long as they use them. Even by 2024, there will be on-premises sales,” he said.
Moreover, he said that low oil prices would not change “our commitment to our investment” in the region.
“I do think that the overall lower revenue growth in companies will make an impact on IT spending and make them move to cloud. Moving to cloud is not just saving money, but it is also about innovation and simplicity at the same time.”
Hurd said that cloud is a big deal as many companies have old infrastructure and there is a need for innovation. He added that there is a lot of pressure to do things such as increase security and adhere to governance mandates which are not innovative.
Oracle currently offers more than 600 different cloud applications. According to Hurd, cloud is important because it offers a lower cost structure and a less complex environment.
Security has been an issue when moving the data from the premises to the cloud. Regarding this, Hurd said Oracle’s M7 chip was a game changer.
“We are putting the security [at] chip level and not on the software level. People are capable of hacking the software and so we decided [to put] it on the hardware level. Hacking the M7 chip is practically impossible,” he said.
He said that Oracle is encrypting the data stored on the server for security reasons. To decrypt it, a customer needs an electronic key and that is with customers.
Hurd said nobody at Oracle could read customers’ data in the cloud.
He added that Oracle is still on-target to sell and book more than $1.5 billion (Dh5.5 billion) of new SaaS (software-as-a-service) and PaaS (platform-as-a-service) business this fiscal year but currency fluctuations may pose a hurdle.
Saas is cloud service where consumers are able to access software applications over the internet on a subscription basis while Paas is a category of cloud computing services that provides a platform allowing customers to develop, run and manage web applications.
Oracle isn’t at the $8.2 billion-plus cloud revenue run rate of Microsoft or even the $4.5 billion by IBM, but Hurd is betting that Oracle’s cloud revenue will keep getting bigger and bigger.
He said that Oracle’s cloud sales growth rate is expected to be around 50 per cent in the third quarter, which ends on February 29.
In the second quarter, Oracle reported a 26 per cent jump in cloud sales to $649 million, the majority of which came from Saas revenue.
Oracle’s Paas and Saas revenues stood at $484 million while the Iaas (infrastructure-as-a-service) revenue stood at $165 million.
Oracle is seeing a fast adoption of its SaaS solutions in the Middle East, particularly human capital management (HCM) in the cloud.
