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LIFE IN THE CLOUD SERIES Tech Companies and their Struggles with “The Cloud” : Oracle Corporation Struggles To Cope With 21st Century Developments




The technology world has evolved from downloading a software on computer to cloud computing concept. Businesses no longer want to keep in-house infrastructure, but rather rely more on outsourcing and using web for data storage. Oracle Corporation has struggled for past few years and is now trying hard to cope with industry innovations. It is not even able to milk its database system any further due to the emergence of big data and cloud, which are often available in open source and usually cost less.

Companies are increasingly becoming used to the fact that 20th century days of product-based “buy once” model are now numbered. The shift to a subscription-based model is to be seen in 21st century. It brings the idea of sustainable customer relationships, as any company would want its customers to keep coming back for their subscription renewal. At present, Oracle lags behind in this domain.

One of the problems being faced by the company is decreasing level of customer satisfaction, mainly due to its complicated licensing terms. In addition, International Business Machines Corporation (IBM) has been turning pressure on Oracle. It has been capitalizing on low customer satisfaction level of the company by offering customers a cheap way to shift to its own services.

 Not only this, IBM has also been investing huge amounts to fuel its strategic initiatives. It plans to invest $4 billion this year alone, and understands the need of the hour is not to stick to its current streams of business but to focus and build on future prospects. Since current segments have been slowing down, there generates the need to invest in the future. Oracle should also think along the same lines to remain competitive.

Oracle’s hardware business is in trouble as majority of its enterprise customers are shifting to cloud-based services. Now the key is not how much production units one has sold, but the number of customers using its services on a continued basis.

Its hardware sale revenue for 1QFY16 was $1.1 billion whereas its major competitor, IBM made $2.1 billion revenue for the same quarter. Decreasing revenue from hardware sales has put pressure on the software stream to generate results. Thus, the tech firm has also tried to shift its focus from hardware to service revenue with majority of its revenue coming from software and service sales. Oracle’s software revenue for 1QFY16 was $6.4 billion compared to $12.7 billion for IBM for the same quarter. Its efforts have not been able to bear fruit in recent years, as it is behind IBM in both hardware and software sales. It reported decrease in revenue year on year (YoY) for both its business functions.

In order to do well in the market a company should be able to maintain that hunger to strive for greatness in its employees as well. For Oracle it has also been a major problem as its employees over the years have felt somewhat restrained in their roles. A technology firm can only stay abreast or move ahead of market developments if its employees are encouraged to think outside the box and develop the products which have potential to shake consumers. Unfortunately, Oracle has not been able to do this for a while now. It is micromanaged and its employees feel their decision-making powers are curtailed every now and then. In recent years, lack of innovation inside the company may have made its employees laid-back. This may have hampered their ability to create unique products. It has also been noticed that a large number of experienced sales personnel have left the company in recent years. Among the many reasons cited, tough sale quotas were a recurring theme.

Its founder, Larry Ellison, in June shed light on its vision moving forward in cloud computing. He briefed the initiatives being taken by the company to stay relevant in the industry. It has come up with a bunch of new services, which include e-commerce software, human resource (HR) applications, and support for open source data technologies, Hadoop and Spark. The event’s theme was tailored around the fact that Oracle’s cloud is now complete.


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OnePlus is is getting into a new line of business: making TVs. Best known for its phones, China’s OnePlus also has a small catalog of really good accessories like wireless earphonesand surprisingly awesome backpacks, though nothing as complex or expensive as a television set. In announcing the news on the OnePlus online forums, company chief Pete Lau describes it as “the first step in building a connected human experience.”

Every hardware manufacturer is now looking intently at ways to monetize the smart home space. Samsung and Huawei recently announced smart speakers, Apple and Google already have the HomePod and Google Home, respectively, and Microsoft and Sony are old incumbents with their Xbox and PlayStation consoles. OnePlus has decided to make its entry point into this market the TV itself, which has always been at the center of home entertainment, though often with the help of other connected devices. Reading Lau’s teaser announcement, the OnePlus TV — which so far only has a project name, no timeline or specs have been revealed — will serve as the connectivity hub for OnePlus’ future vision of the smart home.

The OnePlus smart TV will be developed by a new division within OnePlus, led by Pete Lau himself. Still at the earliest stages of development, OnePlus is currently seeking input from its fans, as it often does, about what their priorities with a future smart TV will be.

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Amazon is said to be prepping an ad-supported streaming video service; it’ll be available to folks who own any of the company’s Fire TV streaming dongles and set-top boxes, reports The Information.

It’ll be separate from Prime Video, which offers a range of licensed shows and movies, as well original content produced by Amazon, to people who are subscribed to Prime.

Amazon's latest streaming device is the Fire TV Cube
Credit: Amazon
Amazon’s latest streaming device is the Fire TV Cube

Do you like good gadgets?

Those sweet cool gadgets?

Oh, yeah

The idea behind this upcoming service, which is dubbed Free Dive, is to help Amazon bring in more revenue through advertising. Ads presently account for a small fraction – about $2 billion out of more than $200 billion – of its annual revenue, but they offer higher margins than retail, and are one of Amazon’s fastest growing earners company-wide.

To that end, the company’s been selling ad space on its site, and is slated to run ads during live sporting events on Prime Video. It also turned off ad-free viewing on Twitch – its game video streaming service – for Prime subscribers earlier this month.

Free Dive could give Amazon a chance to rival Roku, which offers a similar ad-supported streaming service for owners of its devices and is expected to reach 59 million users by the end of 2018. Roku also made its ‘Channel’ service available via the web earlier this month to folks in the US, so you don’t need the company’s hardware to access it. It’ll be interesting to see if Amazon follows suit – and how it plays its cards with customers across the globe, especially in cost-conscious markets like India, where it’s expanding its media offerings.

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Verizon doesn’t sell its mobile phones or wireless plans over Amazon. Nor does it offer Fios, its high-speed internet service. But Verizon does advertise on Amazon.

On Black Friday last year, when millions of online shoppers took to Amazon in search of deals, a Verizon ad for a Google Pixel 2 phone — buy one and get a second one half off — could be seen blazing across Amazon’s home page. And on July 16, what Amazon calls Prime Day, an event with special deals for its Prime customers, Verizon again ran a variety of ads and special offers for Amazon shoppers, like a mix-and-match unlimited service plan.

Amazon, which has already reshaped and dominated the online retail landscape, is quickly gathering momentum in a new, highly profitable arena: online advertising, where it is rapidly emerging as a major competitor to Google and Facebook.

The push by the giant online retailer means consumers — even Prime customers, who pay $119 a year for access to free shipping as well as streaming music, video and discounts — are likely to be confronted by ads in places where they didn’t exist before.


In late August, some gamers were angered when Twitch, a video game streaming service acquired by Amazon in 2014, said it would soon no longer be ad-free for Prime members unless consumers paid an additional $8.99 a month for a premium service called Twitch Turbo.

Amazon derives the bulk of its annual revenue, forecast to be $235 billion this year, from its e-commerce business, selling everything from books to lawn furniture. Amazon is also a leader in the cloud computing business, with Amazon Web Services, which accounts for around 11 percent of its revenue but more than half of its operating income. But in the company’s most recent financial results, it was a category labeled “other” that caught the attention of many analysts. It mostly consists of revenue from selling banner, display and keyword search-driven ads known as “sponsored products.” That category surged by about 130 percent to $2.2 billion in the first quarter, compared with the same period in 2017.

Those numbers are a pittance for Google and Facebook, which make up more than half of the $88 billion digital ad market. But they come with big and troubling implications for those two giants.

Much of online advertising relies on imprecise algorithms that govern where marketing messages appear, and what impact they have on actual sales. Here, Amazon has a big advantage over its competitors. Thanks to its wealth of data and analytics on consumer shopping habits, it can put ads in front of people when they are more likely to be hunting for specific products and to welcome them as suggestions rather than see them as intrusions.

Amazon is gaining in advertising when the public perception of Google and Facebook has soured. In addition, some advertisers have yet to return to YouTube, a growing ad channel for Google, after brands like AT&T were found appearing adjacent to videos that promoted racism or terrorism.

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