- The future of AI and cloud lies in industrial digitalization
- Oracle plans to be early
- Strategy includes a new and profitable role for carriers
Oracle recently gave me an exclusive briefing on their strategy to build the new digital industrialization economy with cloud and AI — and it’s a doozie. Its plan is both forward-looking and, paradoxically, deeply rooted in its legacy database business.
Oracle’s long history of creating custom database solutions tailored to specific industries has equipped them with the acumen to spot the big opportunity — powering the new Industry 4.0 global economy — but also the skills and experience to make the next industrial revolution a reality.
What sets Oracle apart is its access to vast amounts of proprietary, industry-specific data, along with a deep understanding of the specialized applications and services that use it. This gives it a unique advantage over both hyperscalers, such as Google and Amazon, as well as traditional enterprise and telco vendors like Cisco, Ericsson, HPE and Nokia.
Those vendors typically focus on broad IT or telecom networks that don’t really understand the data they carry. Meanwhile, hyperscalers overall are heavily invested in providing ubiquitous cloud infrastructure and AI dominance, but often without deep industry specialization.
Oracle is coming at this from a different angle. Its databases already sit at the core of critical white-collar business applications — think consumer, healthcare and finance — as well as heavy industry environments such as construction, and energy.
This industry-focused approach puts Oracle in a unique position to lead the next wave of digital transformation, filling a role that’s currently up for grabs. The need for vertical industries to be carefully integrated into cloud and network infrastructure is well known, as is the proposed solution: APIs. But this is a misconception. APIs aren’t really a solution — they’re just a tool to build one.
What’s really required is an ecosystem player that understands the distinct commercial, cultural, regulatory, and technological make-up of specific industries, as well as the cloud side of the equation. From this perspective, Oracle is perfectly positioned ab-dab in the middle of the new communications taxonomy — excellent feng shui — ready to manage and inform the integration from a position of authority in both camps.
So, is Oracle making a play to co-opt the entire Industry 4.0 market? No. In fact, its plan comes with another notable feature: a dose of humility. During my meetings, Oracle’s executives were candid about the need for the company to collaborate with partners, leveraging their own specialisms, to bring their Industry 4.0 strategy to life. That could include 5G incumbents offering private 5G capabilities, as well as carriers providing essential network infrastructure.
That’s good news for carriers and service providers currently seeking ways to remain relevant in a new AI-cloud era dominated by hyperscalers. Oracle doesn’t view carriers as simply a network extension. It suggests a new architecture where key network performance parameters — vital for Industry 4.0 applications — are harmonized across the entire network stack. In this model, policy would be applied and automated from OT environments in vertical industries at the top of the stack, through the cloud, and onto the telco network, with carriers charging a premium for delivering a critical, integrated component of the architecture.
It's a big idea, and one of several remarkable differentiators that provide Oracle with a significant competitive moat in the Industry 4.0 market.
Steve Saunders is a British-born communications analyst, investor and digital media entrepreneur with a career spanning decades.
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