News of corporate layoffs is never good, but in the case of Oracle and its hardware business, it was pretty clear that something had to give. The San Jose Mercury News reported on Friday
that about 450 employees were being laid off, although other sources have pegged the number
at as high as 1,800. Regardless the exact number, the reality is that life is about to get a lot harder for hardware companies and Johnny-come-latelies to the cloud.
The hardware story is self-explanatory, a demise fueled by a surge in workloads and applications moving to the cloud. Large enough companies will always buy servers and other gear, but a combination of open source (software and hardware), microservices and containers will suck most of the remaining profits out of the market for sellers.
However, I suspect Oracle and companies of its ilk are not out of the woods yet, even if they double down on the cloud like Oracle has. While they play catch-up in building out basic cloud infrastructure and services, the providers who already dominate the cloud are beginning to make their plays up the stack and at the edge. Up the stack, cloud providers such as Amazon, Google and Microsoft are rolling out everything from “serverless” computing frameworks to APIs for artificial intelligence. At the edge, they’re building out even more capacity and helping developers move computing and data processing onto devices, connecting back to their clouds for the more intensive work.
They’re doing all of this because they’ve already established themselves as the default places to run modern web and mobile applications (hence the term “cloud-native”
), and now they’re targeting the next wave of application development that will be fueled by the Internet of Things.
Getting into the cloud game now is like getting into the server business while VMware was hitting its stride. Yeah, there’s some money to be made from stragglers, but you’d have to come with something truly amazing to remain relevant once that pool dries up.