IBM Watson is just 'an advertisement' for AI while Amazon Aurora is 'not very good' - Oracle's Mark Hurd was on fire today

And 'we don't compete' with SAP anymore, of course

Oracle CEO Mark Hurd's press Q&A session is always a highlight of Oracle OpenWorld, and this year was no exception, as IBM, Amazon and SAP all received a flurry of barbs.

While Hurd lashed out at competitors with increasingly wild swings, he did at least shed a little more light on the company's newfound obsession with IaaS.

Insisting, as Ellison did yesterday, that Oracle has "rewritten everything we have", Hurd also brought out figures to remind everybody that Oracle is now the "fastest growing scaled cloud company in the industry" along with a "gross margin... now up to 62 per cent in SaaS and PaaS business".

In fact Oracle's cloud income in comparison with its total revenues are comparatively low, but taking all these boasts at face value, let's go back to focusing on that IaaS can of worms that Ellison opened.

"We're the only company delivering a complete portfolio," said Hurd.

"Historically, we've talked a lot about SaaS, and we're making tremendous progress in ERP and CRM and marketing. Last year at this show we talked a lot about PaaS - we've released a lot of services in PaaS and they've come to market in the last fiscal year," he continued.

"And this year - yet more IaaS."

In for structure?

Hurd made it clear - if there was any doubt at all - that Oracle would not be competing with AWS for consumer business.

"Not our strategy. Our strategy is to go to companies - both big and small. So anything above consumer," he said.

"And one of the great things about cloud is it's opened up our capabilities to the small and medium business market."

Next, Hurd decided to talk about "gap and catchup", laying into Amazon.

"Amazon's got a lot of catching up to do to with us in the applications market. I'd say it would be impossible - but they can try. They've got a long way to try to catch up in the PaaS market. They don't have native database technology. They take on other open source tools, they make them lock-ins by extending them, and only allow you to use them on their cloud."

Echoing Ellison's central points from yesterday about how Amazon is obsessed with locking everybody in, Hurd then took a slightly different, and rather stranger tack - going straight for the throat of Amazon's new database platform, the MySQL-based Aurora.

"We'll give you all of Oracle's technologies on our cloud, but also allow you all the open source technologies and then you can move those capabilities to any cloud you want to. But they say you can only use Aurora in Amazon. So it really is the ultimate lock-in strategy that they have.

"Our point is to be open. Our point is to say our on-prem customers can take their licences and run them on Amazon. Now, I think people should go and get Aurora from Amazon, do some work, then call up Amazon and say 'I want to take all the work I did on Aurora and move it to the Oracle Cloud. What do you think Amazon will say?"

"'No! You can't do that!'" he screamed. "'You're locked in! This is proprietary!'"

He went on to describe how Amazon's "IP isn't very good".

"When you and look at their ability to really do database work - forget Oracle for a sec.

"In the database market, how much market share can Amazon take from Microsoft? How much market share can MySQL - which is Aurora - take from Microsoft? My answer would be - very little.

"There's tons of programming on SQLServer, you have to move that programming over - there are very few features on MySQL, a lot of work to get that done.

"So to be blunt with you, Amazon has been very good traditionally with infrastructure, but when you try and move up the stack it becomes harder to become more sophisticated."

The picture Hurd painted is of an Oracle that is taking the IaaS fight to Amazon, even on a cost basis, while Amazon is trying to topple Oracle as a database company.

It was the first time during this conference - bar a few mutterings about product updates in Ellison's keynote - that Oracle even mentioned databases. It's hard to believe the database giant really feels threatened by Aurora, more likely it was an opportunity to position Oracle as a serious business vendor.

Hurd accused Amazon of trying to "move up the stack" with its "not very good" database, while all Oracle has to do is move "down the stack".

Moving up the stack is the "hardest thing to do in technology", said Hurd. "We feel really confident because of the depth of our IP we're advantaged - we're ahead. And we want to wrap infrastructure around our capabilities."

Fair point, but is IaaS really where Oracle should be focused?

IBM Watson is just 'an advertisement' for AI while Amazon Aurora is 'not very good' - Oracle's Mark Hurd was on fire today

And 'we don't compete' with SAP anymore, of course

"Our customers get a vote"

Yesterday Ellison gave the impression that Oracle is trying to work out what customers want, but Hurd insisted he knew: it's IaaS.

"I wish the world worked in such a way that it wasn't dynamic," he said.

"But our view is that customers get a vote, and much of what we're doing isn't just about what we want, but also what customers want, and customers want access to technology and capability in a very different way than they ever have before.

"Part of that is technical, and part of it is economic. I think for us the barrier for a technology company moving from on-premise to the cloud is pretty high. It starts with not only having the IP, but you also have to be able to move that IP to the cloud, and that means building data centres and capabilities."

Hurd insisted that Oracle is now "a long way into it" having spent "years rewriting software and hiring a bigger salesforce".

And then to SAP.

"Many of the companies we used to compete with, we don't compete with now. So in the applications world we compete with a little company like Workday," said Hurd.

"We also don't compete anything like as much as we used to with SAP, because SAP hasn't rewritten applications for the cloud - they're basically trying to take their existing applications, put them in an SAP data centre and call it cloud," he claimed.

"But really what it is is hosting - it's nothing but hosting an on-premise application. Once a customer figures that out, we don't really compete with that as much as we did before."

Nothing we haven't heard before, perhaps, but then things got really weird, as someone brought up AI. Hurd said artificial intelligence is "nothing more than pattern matching" and called IBM Watson an "advertisement".

"I look through a bunch of videos and say 'Those two images are the same, or those two pieces of text are the same, or those two numbers are the same'. The real trick to this isn't where you see it with advertisements like Watson, but the ability to get it into my day-to-day work," said Hurd, alluding to yesterday's keynote, when Ellison used a chatbot to order some business cards and make a crack about no longer being CEO, as the bot spotted his "change of title".

"I [can use chatbots] to do something productive, like make business cards. It's about not making it a hobby, but integrating it," said Hurd.

IBM Watson is already used by many, and is even helping to find a cure for hereditary diseases by fast-mapping human genomes. The comparison with chatbots seemed misplaced.

Oracle is applying its end-to-end philosophy to the cloud, figuring that if it controls all aspects - SaaS, PaaS and IaaS - it can use any one of these avenues to control the conversation. But, like the Watson example, having a direct pop at Aurora seems like an odd way to go after Amazon.

We'd question how many people would want to use IaaS as a gateway to other Oracle products and services when, as Hurd rightly stated, the company's PaaS and SaaS offerings are so well developed. Just look at the positive HSBC case study delivered this morning.

We were expecting to hear more about 'visibility' between different companies using Oracle Cloud, as was mentioned in off-the-record conversations last night, but on the day Hurd simply chose to have a go at rivals instead.