Tuesday, August 18, 2020

Why Would Oracle Want TikTok?

TikTok Logo
Oracle is reportedly in talks to acquire the certain operations of social video service TikTok. 

I'm hearing through the back channel that the move is not being well received within Oracle itself this morning. 

From the Verge

Oracle has expressed an interest in acquiring TikTok, according to the Financial Times, giving Microsoft a potential competitor in its bid to control the Chinese social video app in the US. Larry Ellison’s enterprise software giant has reportedly held preliminary talks with TikTok’s parent company ByteDance already, working with venture capital firms including General Atlantic and Sequoia Capital, and is “seriously considering” acquiring its business in the US, Canada, Australia, and New Zealand.

So why would Oracle acquire a business that is so far out of its market space? 

I've heard speculations from various quarters. It could be motivated by a desire to leverage TikTok's user data to enhance Oracle's marketing products. It could be motivated by a desire to get into a consumer business. It could be motivated by a desire to hurt Microsoft--something that would fit Ellison's competitive nature. 

There's one more possible motivation I haven't heard mentioned, and that is to get TikTok's huge workload for Oracle Cloud Infrastructure (OCI). Oracle's market share lags far behind Amazon, Microsoft, and even Google's. There is a bit of a chicken-and-egg problem facing Oracle, however. Cloud infrastructure providers need large workloads to realize economies of scale, making them price competitive. But how can Oracle achieve that scale? One way is to buy the workloads. And what bigger workload than a video-sharing service? 

This is likely the reason that it offered a deal to host some of Zoom's workloads on OCI. So, it might also be the primary motivation for Oracle to pitch for TikTok. 

Anyone with me?  

Saturday, August 08, 2020

Impact of the Coronavirus Pandemic on IT Budgets in 2020

Over at Computer Economics, we just published our annual IT Spending and Staffing Benchmarks study, now in its 31st year (click to download the free executive summary). 

This year, however, there was a bit of a complication: The COVID-19 pandemic hit right in the middle of our survey period. So, in order to measure the impact of the pandemic, we added special questions to our survey and also went back and re-surveyed those who had already responded. We published the results in a special supplemental report: Impact of the Coronavirus Pandemic on IT Budgets in 2020. The results are interesting, and we plan to repeat the survey in the coming weeks.  

In addition, Dave Wagner and I gave a free webinar to present a summary of the results of both reports. Click the image below to watch the full replay.