Oracle's Customers Are Not Interested In Its Super Important New Cloud, Analyst Says

Larry EllisonOracle CEO Larry Ellison speaking at OpenWorld 2012

Photo: Julie Bort/Business Insider

Oracle spent six years developing its new software-as-a-service cloud called Fusion, it’s largest-ever R&D effort.While Oracle says Fusion is doing well (it booked $230 million in revenue the last reported quarter), market researcher Forrester just published a report with some shockingly bad stats about it.

Forrester surveyed 139 Oracle customers and found that nearly none of them had plans to use Fusion. (64% said they planned to upgrade to the Oracle software they are using and another quarter said they had no plans for Fusion or for an upgrade).

Oracle says it has 400 customers for Fusion. However, last October, Oracle senior VP Chris Leone acknowledged that of the 400, only about 100 at that time were really using it “in production,” meaning to run their businesses, reported InformationWeek’s Doug Henschen.

“If Oracle Fusion Applications are the future for Oracle, most Oracle users haven’t gotten the memo,” the Forrester report says.

Oracle needs Fusion to be a hit because “in recent quarters, Oracle’s application revenue growth has underperformed both the overall software market and SAP,” Forrester said, adding that Oracle’s acquisitions of software-as-a-service companies, like Taleo and RightNow Technologies, hasn’t been enough, so far, “to take up the slack.”

Oracle vs SAP quarters chart

Photo: Forrester

Oracle had no comment on this report. However a source inside the company said that Forrester’s survey took place in June, and called the data “outdated.”

We’ll add that it’s still early for Fusion and Oracle has plenty of time before it needs to hit the panic button.

Whether it can convince its customers to move or not, Oracle still needs this cloud. Right now, Fusion is helping Oracle win business away WorkDay, the company founded by Larry Ellison’s old nemesis, Dave Duffield, Ellison says.

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