Database competitors on high alert: Oracle’s new Exascale service could change the rules of the game

Database giant oracle (ORCL 0.38%) is spreading its digital wings in the cloud. A new service strengthens the already impressive Oracle Cloud Infrastructure (OCI) platform and helps customers save costs on high-performance cloud computing.

How does this new service fit into Oracle’s business model and will it make a difference for Oracle investors? Let’s take a look.

What’s new?

The new Oracle service is actually an upgrade of a multi-tiered stack of Oracle software.

• OCI is a comprehensive cloud computing system, similar Amazon Web Services (AWS) and Microsoft Azure blue.
• Exadata is a popular way to run Oracle’s database services in the cloud. It can run in the customer’s data center or other cloud systems such as Azure or AWS, but Exascale is designed for tight integration, absolute security, and maximum performance on the OCI platform.
• The new Exadata Exascale service is a new type of cloud-based data architecture. Exascale is designed to scale according to the customer’s needs, managing computing hardware, network requirements and data storage using artificial intelligence (AI) tools. Crucially, the flexible Exascale system reduces the cost of running the platform and using Oracle’s databases. The company claims savings of 95% for the smallest and cheapest Exascale solution compared to running Exadata without Exascale.

Exascale makes the powerful Oracle Exadata system more flexible and cost-effective, especially when combined with the OCI platform. In particular, the Exascale solution makes Oracle’s market-defining database software accessible to a larger group of small and medium-sized companies.

Cost efficiency as a guarantee of success

The cost savings are no joke. Oracle stated that the entry-level price for an OCI-based Exadata database is $10,800 per month.

Low-end or not, this is a huge computing platform – you’re buying access to more than 1,000 processors and 150 terabytes of data storage for a month. In contrast, a starter package of exascale services includes 16 virtual processors and less than 1 terabyte of storage. Billing is based on hours of use, but starts at just $357 per month. That’s a bargain if you don’t really need a huge cloud computing machine.

On the other side of service scaling, enterprise customers can deploy truly massive exascale database solutions in no time. Oracle positions this service in its marketing strategy as a useful data store, for example, to feed training data into AI engines. In addition, the Exascale system works with Oracle Database version 23c and higher, encouraging users of older versions to upgrade their contracts and capabilities to Oracle’s latest and greatest software.

How Exascale fits into Oracle’s business model

From a practical perspective, the Exascale system enables companies to scale their computing resources up or down as needed, providing flexibility and cost efficiency.

• For smaller companies, this means access to high-performance computing at a fraction of the cost, allowing them to compete with larger firms without significant capital investment.
• For large enterprises, the ability to quickly deploy large-scale database solutions supports the need for large-scale data processing, such as AI training and big data analytics.

This versatility and affordability will enable Oracle to capture a larger share of the cloud computing market, driving innovation and efficiency across multiple industries. Oracle is seeking to expand its target market at both the high and low end of the enterprise size spectrum.

Time will tell how quickly cloud computing users will embrace Oracle’s ultra-flexible service offering, but the company is clearly not resting on its laurels. Moreover, Exascale is an AI service that covers both sides of the coin: it integrates on-the-fly analytics to power its data management services and sells the resulting product to the AI ​​training market.

Oracle’s Exadata Exascale could shake up the database market in two ways

For investors, Oracle’s strategic move with the exascale system signals a commitment to innovation and market expansion. Oracle could strengthen its market presence in both the large enterprise sector and the broader target of small and medium-sized businesses. The digital wings I mentioned earlier are stretching to the sky And Contacting potential database buyers at a basic level.

If nothing else, cost-effective database providers like MongoDB And Couchbase should tremble with fear. Oracle’s new service is aimed at the all-important base of cost-conscious customers.

The lower end-user costs appear to put pressure on Oracle’s profit margins, but it is worth remembering that the exascale system is inherently more cost-effective. Lower operating costs should offset the lower customer bills, maintaining Oracle’s profitability while increasing market size.

Good move, Oracle.