… but as the saying goes, words will never hurt me. I bet if a SAP HANA or Oracle Exalytics box landed on your foot, it would hurt though.
SAP created a new class of computing this year – it brought together high-end commodity hardware, new software and large amounts of RAM. The era of in-memory computing is on its way. I have, at times, been critical of SAP’s overmarketing of this at a time when the product was not ready for market. Marketing is all about making products easy to sell, and hype extends the sales cycle. That said, I also believe that in time, SAP HANA will be seen as an inflection point in computing. It may or may not be the dominant supplier, but it got there with the right appliance at the right time.
So it’s no surprise that Oracle entered the market soon afterwards, with its Exalytics in-memory appliance. On the face of it, SAP HANA and Oracle Exalytics are very similar and they definitely reach out to the same market – those people who want mid-volume (1-5TB of traditional data mart), extremely high performing, complex analytics.
What is also clear when you get into the detail, is that SAP have architected something new and very interesting – HANA has the potential to be an application platform, database and appliance that underpins all of SAP’s enterprise software, and also potentially software from other vendors.
By contrast Oracle Exadata is (today) a patchwork quilt of existing software, shoehorned into an in-memory appliance. Oracle has its work cut out for it building out a more cohesive and simple in-memory appliance. But note that Oracle does have an existing stable and mature RDBMS. SAP does not, and it must go through that product maturity cycle with HANA.
So why the willy waving?
With this in mind, why on earth have SAP reacted the way they did, to the Oracle news. It’s traditional for Hasso Plattner and Larry Ellison to abuse each other a bit (Hasso famously mooned Larry), and it’s definitely business-as-usual for Oracle to name call in public, like Hurd and Ellison recently. But remember Plattner is not a SAP employee and can do whatever he wants.
Normally however SAP are more demure. Not so this week, and it all kicked off with Bob Evans (a paid journalist by SAP) who wrote on Forbes: Oracle President Safra Catz Suffers SAP Hallucinations. This stuff reads like wartime propaganda. Check it for yourself. That was Monday and Bob is a journalist by trade and prone to sensationalism – check some of his other posts. I can forgive him for his content because he produces what he’s told to do.
But then came Tuesday, and Chief Marketing Officer Jonathan Becher and Head of Technology and Innovation Platform Marketing for SAP Aiaz Kazi took centre stage. They put the simple message out there with his Forbes post: Why SAP HANA is a Better Choice than Oracle Exalytics. This piece has the frosted gilt of Bob Evans’ hand, and I’m guessing he edited it.
Customer-centric: In attempting a retro-IBM style move with their hardware infatuation, Oracle has forgotten the customer. I watched hours of videos and read litanies of blogs but I can’t find answers to simple questions.
Really SAP shouldn’t be throwing stones in glass houses – SAP HANA information can be hard to find, and it is by no means a market-perfect solution. But again I can forgive Jonathan and Aiaz – I think they got a bit carried away with their story, and the editing pen made it sensationalist.
And then Wednesday came. President and Corporate Officer, Global Solutions at SAP, Sanjay Poonen, logged into Forbes and posted his tuppence worth: Oracle’s Exalytics: “Old Wine in New Wineskins”. The propaganda continues with:
CIOs, the choice is yours: sign up for Oracle’s Exa parade and its never-ending set of hardware purchases, licenses and maintenance, and it will increasingly lock-in control over you and your future, with antiquated architectures.
I don’t really know what to say to this.
Why does SAP appear to be threatened by Oracle Exalytics?
So why? Why the parade, the fluffing of feathers and the sharpening of claws? Why the impromptu video of CTO and board member Vishal Sikka? Why?
The only clear reason appears to be investors and share prices. If the market thinks that SAP HANA can be replicated by Oracle in 10 short months then they might think that SAP HANA isn’t so special after-all and the financial community might reduce their expectations of SAP’s stock.
The problem is that I talk to a number of these analysts on a quarterly basis and they are very smart people. They take advice from a number of people in the technology community and crunch numbers for a living. And they live in large-enterprise politics and can see straight through propaganda.
A parting thought
What’s more, they will understand that SAP HANA is (currently) the right way to architect in-memory computing and Oracle Exalytics is not. They will also understand that this is the first battle and the war for dominance in this space has only just started.
And if you’re listening SAP right now – throw away Thursday and Friday’s blogs (who next, McDermott?) and focus on creating clarity of vision of the go-to-market proposition. Because that, is what CIOs buy.
Based on further conversations with Enterprise IT experts, I can confirm another dimension that I hadn’t thought of. The mass of SAP rhetoric has sent parts of industry into a temporary panic. Why, they muse, is SAP so bothered about this? There must be something very damaging in Oracle’s announcement and SAP must be running around to cover it up?
Probably not what the execs at SAP were looking to achieve, unfortunately. By the way those experts seem to have gotten to the same conclusion that we discuss here: Exalogic is not so damaging to SAP, and the reaction is therefore bizarre.
Update 7th October 2011
This post seems to have caused some upset. I thought it was reasonably objective (and it is certainly not my intention to upset people) but this is the response I got from board member Vishal Sikka:
@vsikka: @MatthiasGerisch @applebyj so tons of people ask you to respond, you do, as humbly as possible and without bs, and that’s propaganda? Wtf.
Vishal’s response is understandable to some degree, given that his YouTube video is indeed candid and quite objective. But again the point I was trying to make was in two dimensions:
1) Why criticise your competitors at all? I work for a SAP Systems Integrator and you don’t see me publicly criticising competitors like Accenture, IBM or Deloitte. Customers will buy my organisation’s services based on the quality of our value proposition alone. Criticising my competitors is not useful and customers are usually distrustful of people that do this.
2) SAP’s board is responsible for its overall outward response. It doesn’t matter about an individual response – it is the overall picture of articles, interviews and blogs that is painted, including those people that write them. And it is this picture – not an individual video – that appears to be propaganda in this case.
And if SAP’s board isn’t happy with its overall media response, it needs to do something about it.
P.S.: I joked that Thursday’s post on Forbes would be by McDermott. Amusingly, it is, although it is by Tim Clark and entitled SAP’s Bill McDermott: “It Doesn’t Take Two Years to Create a Good Strategy”. Not a dig in Oracle in sight. Phew.