While in San Francisco last week, I noticed that there were more yachts in the bay than usual. It could only mean one thing: it’s time for Oracle’s (Nasdaq:ORCL) huge conference.
The event attracts tens of thousands of customers and media people. While they go there to get the latest on the industry trends, the real reason is probably the parties (this year’s entertainment includes concerts from Sting and Tom Petty).
However, for Oracle’s CEO Larry Ellison, it’s also a great opportunity to take shots at his rivals like IBM (NYSE:IBM), SAP (NYSE:SAP) and Hewlett-Packard (NYSE:HPQ). It must be nice to be a billionaire software tycoon, right?
What’s more, Oracle continues to perform quite well, despite the global slowdown as well as changes in technologies.
Yet Ellison has a keen understanding of the big picture, and interestingly enough, he may be getting nervous. Consider that he abruptly cancelled the conference’s keynote address by Marc Benioff, the founder and CEO of Salesforce.com (NYSE:CRM), a pioneer of cloud computing, which allows customers to access software via the Net. It tends to be easier to use, and the costs are generally lower, especially when compared to Oracle’s offerings.
And Salesforce isn’t standing still. Keep in mind that it continues to launch new products like Data.com as well as make huge investments in social media. To this end, the company has developed Chatter, which is essentially a Facebook for businesses.
Salesforce is growing at a rate that is reminiscent of Oracle’s heyday. In the latest quarter, revenue spiked by 38%, and the company’s market cap is now at about $15.6 billion.
As for the keynote cancellation, Benioff, a former Oracle executive, hasn’t given up. On Thursday, he’ll give a presentation at San Francisco’s St. Regis Hotel (he tweeted that the “show must go on”) across the street from the Oracle event.
So all in all, Ellison’s decision, which looks like punishment for critical comments of Ellson’s Sunday speech retweeted by Benioff, looks fairly lame. After all, over the years he has delighted on killing his rivals. So what’s the point of cracking down on Benioff?
Oracle said the speech wasn’t cancelled but merely a scheduling change due to overwhelming attendance. Again, it sounds lame.
If anything, the episode only gives Benioff more visibility, which he certainly craves. More importantly, it’s yet another piece of evidence that cloud-computing is a serious threat to traditional software.
Tom Taulli is the author of “All About Short Selling” and “All About Commodities.” You can also find him at Twitter account @ttaulli. He does not own a position in any of the stocks named here.
