Netspark's Blog

Mar 27 2019

Oracle Cloud at the end?

It seems to be hard times for Oracle when it comes to
Cloud Services. According to various news portals,
Oracle has started laying off employees who are involved
in Cloud development. An internal mail shows changes…

As with the published mail on https://www.thelayoff.com Don Johnson thanks his team for the good work on OCI which is Oracle’s 2nd Gen cloud service. Although the words show that OCI is on it’s course, you can read between the lines that a restructurization is ahead which in most cases means radical layoffs to increase revenue.

This is the mail, which is also available on Thelayoff.com:

Team,

I wanted to share with you context for the organizational restructuring happening today.

Over the past several years we’ve seen progressive change as Oracle has evolved into a cloud services company at its core. This is a giant shift across the company, often with our organization at its epicenter. It has affected the entire business broadly and pervasively – driving reorganizations, realigning investments, changing how we build and operate services, and evolving how we engage with our customers.

At last year’s Oracle Open World, Larry was clear about the vision and direction of the company: We’re an enterprise cloud company supporting the most demanding customers and the most challenging workloads. We’re organized around two centers of gravity: Apps and Infrastructure. As the foundation of our cloud business, OCI – Oracle’s Gen 2 Cloud – provides our customers with a secure, reliable infrastructure platform that supports the primary pillars of our business, Autonomous Database and SaaS ERP.

Everything in the company is aligning around this clear vision and direction.

Today’s changes within OCI will better align with Larry’s vision of the business. It will streamline our products and services, focus investments on our most strategic priorities, and help us to more effectively and rapidly deliver the full promise and reach of Oracle’s Gen 2 Cloud.

Please join the OCI Leadership and me in an All Hands tomorrow, March 22nd, at 10:00 AM PDT to get more information about what this means for our team and the business.

OCI’s business is stronger than ever, and this team’s future is bright. I want to thank you all for your continued support as we double down on our strategic imperatives. We’ll be building regions, continuing to hire and invest in strategic areas, and growing the business and our customers at a rapid pace.

–Don

This appears so disappointing to all those who helped Aoracle to come up with an own cloud service following the SaaS scheme just to have it then being moved to Cloud Service providers, like Google.

So the question is: Did Oracle fail to provide the infrastructure for their service or what are the real reasons for the massive layoffs worldwide.

According to another news portal the layoffs are currently as follows:

Redwood City HQ, San Francisco: 250
Seattle: 40
Santa Clara: 100
India: 50
Mexico: 50
Europe: 120 – 180* (estimated as Oracle Europe refused to tell)

But there’s still speculations about the total layoff count where numbers range from 5000 to 14000. That would mean about 10% of the employees worldwide!

And although the net earnings are about 9 billion US$, this seems to rectify this huge layoff? Well, this is the ugly side of the ever-wanting-to-grow-capitalism.

Interesting fact: The CEO had a total compensation of a “measly” 109 million US$ in 2017.

He had a compensation of a month’s salary of about 10.000 of his loyal employees!

Way to go, Oracle! Another reason why Oracle has a bad reputation worldwide when it comes to good work conditions…

Anyway… the development of Oracle Cloud is indeed a bit strange and compared to Amazon Cloud igaining power in offering Cloud Services, this step is a bit brave. Perhaps all those who got laid off will now start a new employment with Amazon which would also mean a setback for Oracle Cloud!