
Zoom taps Oracle for cloud deal, passing over Amazon, Microsoft - SREinSF
https://www.cnbc.com/2020/04/28/zoom-taps-oracle-for-cloud-deal-passing-over-amazon-microsoft.html
======
scott00
Some useful context: Zoom also runs 17 of their own data centers in addition
to using AWS and Azure[0]. This deal is to run their "expansion" on OCI. Hard
to say what that means exactly, but it doesn't sound to me like Zoom is making
a big bet on OCI.

[0] [https://www.cnbc.com/2020/03/18/zoom-cfo-explains-how-the-
co...](https://www.cnbc.com/2020/03/18/zoom-cfo-explains-how-the-company-is-
grappling-with-increased-demand.html)

~~~
latch
This just doesn't pass the smell test. Running your own data center is a huge
capital and operational investment. While there are hundreds of companies
world wide that do this, they tend to be core telecommunication companies
(infrastructure), dedicated data center operations, dedicate hosting companies
or companies with billions in revenue.

A google search confirms that they colocate, apparently with Equinix. This is
as far as running a data center as living in an apartment is to building and
managing apartment buildings.

(Fun Fact, while Amazon does own and run its own data centers in most places,
they're also colocating with Equinix in some regions (though I assume their
level of colocation goes beyond traditional colocation)).

~~~
kelp
When they say "running a datacenter" they almost certainly mean "buying
servers to put into rented colocation space".

Just about anyone who has significant network connectivity has a footprint in
an Equinix datacenter. In the Bay Area you want to be in Equinix SV1 or SV5,
at 11, and 9 Great Oaks, San Jose.

If you're there, you can order a cross connect to basically any telco you can
imagine, and any other large company. You can also get on the Equinix exchange
and connect to many more.

But, Equinix charges you a huge premium for this, typically 2 - 3x other
providers for space and power. Also they charge about $300 per month per cross
connect.

So your network backbone tends to have a POP here, and maybe you put some CDN
nodes here, but you don't build out significant compute. It's too expensive.

On the cheaper, but still highish quality end you have companies like
CoreSite, and I'm pretty sure AWS has an entire building leased out at the
CoreSite SantaClara campus for portions of us-west-1. (Pretty sure because
people are always cagey about this kind of thing.)

I also know that Oracle cloud has been well know for taking lots of retail and
wholesale datacenter space from the likes of CoreSite, and Digital Reality
Trust, because it was faster to get to market. This is compared to purpose
build datacenters, which is what the larger players typically do.

In the case of AWS, I know they generally do a leaseback, where they contract
with another company who owns the building shell, and then AWS brings in all
their own equipment.

But all these players are also going to have some footprint in various retail
datacenters like Equinix and CoreSite for the connectivity, and some extra
capacity.

Zoom is probably doing a mix of various colocation providers, and just getting
the best deal / quality for the given local market they want to have a PoP in.
Seems like they are also making Oracle Cloud part of that story.

~~~
KorematsuFred
So many people forget that running data center is a super complex business not
just in point of technology but also in terms of operation.

I have known people who tried to setup a data center in India and it took them
around 2 years to have the first rack installed. Biggest hurdle was to get a
license to store fuel in large tanks for their generators. Not to mention many
of those permissions have to be renewed annually and if you fail to renew it
which can take months, you are not in compliance and hence can't use the
generators.

In India you can not start your own power generation plant and you can sell
electricity only to the government. Depending on many situations you have to
technically register a separate entity, get licenses as a "power company" then
on paper sell the electricity to government and then buy it back from
government for your own use.

~~~
blueblisters
You can get around some of these operational constraints with technology. For
example, Google had a server design with its own in-built backup battery
supply, which incidentally could be cheaper than diesel generators. So backup
power for your servers is solved but you still might need to figure out backup
power for other parts of the datacenter.

~~~
freepor
Batteries don’t have anywhere near the energy density of hydrocarbons.
Batteries are good for a few hours, but if you want to be able to run for days
off-grid you will need hydrocarbons.

------
ram_rar
I worked in a startup that was eventually acquired by cisco. We had the same
dilemma back then. AWS and GCP were great, but also fairly expensive until you
get locked in. Oracles bare metal cloud sweetened the deal soo much, that it
was a no brainer to go with them. We were very heavy on using all open source
tech stuff, but didnt rely on any cloud service like S3 etc. So the transition
was no brainer.

If your tech stack is not reliant on cloud services like S3 etc, you're better
off with a cloud provider who can give you those sweet deals. But you'll need
in house expertise to deal with big data.

~~~
matt_heimer
Most cloud providers, Oracle included, have an S3 compatible object storage
API - [https://docs.cloud.oracle.com/en-
us/iaas/Content/Object/Task...](https://docs.cloud.oracle.com/en-
us/iaas/Content/Object/Tasks/s3compatibleapi.htm)

Even the few that don't, you can use something like Minio.

I wouldn't consider S3 something that requires lock in.

~~~
skuhn
Imagine migrating 100 PB from S3 to Oracle's object store. First of all, the
egress fee will cost you $5,000,000 (no joke). Second, it will take months.

Don't think your early stage startup will ever have that problem?

That's exactly what a lot of other people thought 5-10 years ago, and now
they're stuck in S3 which means they need to use EC2 to manipulate that data
which means they may as well put it all in AWS because egress fees will eat
their lunch.

~~~
1stranger
At that scale you're talking about millions in storage cost a month so I'm not
sure $5 million is that scary.

Also for that amount of data it'd be faster to transfer as a stationwagon full
of backup tapes
([https://aws.amazon.com/snowball](https://aws.amazon.com/snowball)).

~~~
matt_heimer
For 100PB they actually have a semi-truck option
[https://aws.amazon.com/snowmobile/](https://aws.amazon.com/snowmobile/)

------
cmauniada
Why? Is it because of cost? Perhaps nepotism? I don' see a reason why Amazon
or Azure would be passed over in favour of Oracle. Why wasn't GCP a contender
either? Something seems fishy... someone from Zoom care to chime in?

Maybe they are afraid that Amazon or Microsoft with their tradition of copying
competition would pose a threat? Even then, Microsoft is already competing
using Microsoft Teams and if Amazon wanted to it wouldn't be hard for them at
all to come up with a product.

~~~
partiallypro
My guess is simply, they don't want to fund their own competitors. Microsoft
is a direct competitor already (so is Google,) and who knows what Amazon will
do. That really only leaves IBM and Oracle. I've always been baffled when
someone hosts on their competitors' platform. Like Netflix hosting on AWS, and
Grocery Stores hosting on AWS. Microsoft & Google rarely have that problem
(except on this one.)

~~~
ViViDboarder
I’ve been impressed by what I’ve heard about Walmart. They apparently won’t
even use a SaaS tool if it’s hosted on Amazon.

~~~
STRiDEX
I worked at walmart labs for 3 years and that is correct. We had one, on
premise, service that phoned home for license information to an AWS address
and our request to whitelist the ip address had to go up to the CTO.

~~~
empath75
That’s changed hasn’t it? I remember going to a Walmart labs talk 5 years ago
where they were all in on aws.

~~~
shanemhansen
No. I don't think so. They really don't like AWS. It's all
openstack/azure/gcp/vmware depending on the use case.

------
MattGaiser
I suspect Oracle is giving good deals as nobody ever considers them as a cloud
provider, so they need to gain market share to stay relevant. They wouldn’t be
in the top 10 lists of ones I would think of.

How many here even knew they had a cloud you could use?

~~~
Havoc
I did. Tried their free credit stuff. Was seriously unimpressed. Felt like a
beta test

Unless it's way cheaper I don't see the point

~~~
laughyy4
Oracle and cheap.

Thanks for the laugh.

~~~
lucianf
That's not fair, this is about OCI not the larger Oracle. It's like bashing
Azure for what Microsoft has done in the past (funny how we're not hearing
much about that anymore).

OCI is cheaper than AWS on pretty much every metric. In this particular
context:

"The Reuters article helpfully points out that Zoom has 217,000 terabytes a
month of traffic flowing through it. If we assume all of that is from inside
of Zoom’s environment out to the internet (it absolutely isn’t, but it’s a
fine worst-case data transfer scenario) and all of it is moving to Oracle now
that the deal is signed (certainly not happening, but work with me here),
according to public pricing that data transfer would cost, per month:
$11,186,406.55 on AWS, nobody knows on Azure because the pricing calculator
thinks I’m screwing with it when I put that big of a number into it, and
$1,843,630 (hat tip to Jeffery Lyon on that; I moved a decimal in an earlier
version of this post) on Oracle Cloud."

[https://www.lastweekinaws.com/blog/why-zoom-chose-oracle-
clo...](https://www.lastweekinaws.com/blog/why-zoom-chose-oracle-cloud-over-
aws-and-maybe-you-should-too/)

(disclaimer, I work at Oracle)

------
btown
For those who may think Oracle may have moments of nuance, it's always worth
listening to Brian Cantrill's epic rant on Oracle and lawnmowers:
[https://www.youtube.com/watch?v=-zRN7XLCRhc&t=34m7s](https://www.youtube.com/watch?v=-zRN7XLCRhc&t=34m7s)

~~~
breischl
Wow, that is an impressive rant.

>Don't make the mistake of anthropomorphizing Larry Ellison

That is just brilliant comedy. :)

------
AndrewKemendo
A lot of "they must be crazy" in this thread and I admit I had the same
reaction seeing the headline.

However there are some options here other than "Zoom management is
incompetent."

1\. As others have pointed out, Amazon Google Msft all have competitive
products and Zoom doesn't want to give them any more insight than they already
have.

2\. Oracle finally has a set of cloud products that are on par with AWS, GCP
or Azure from a cost, availability, license perspective

3\. They got a great deal to help Oracle change the way they do business so
they can become competitive in Cloud

I don't know if any of these are true or not, but none are implausible imo

~~~
amalter
Additionally - I don't know if Zoom's backend is Java, but if it is - Oracle
has a sweet deal on getting the Enterprise version of Graal for free if you
run on Oracle Cloud.

I think this could be a smart move for a company to be the "big fish in a
small pond" \- even if that pond is owned by a shark with freaking laser
beams....

------
yellowapple
RIP Zoom's devops team.

Having experience with AWS, Azure, and OCI, I wouldn't voluntarily touch OCI
with a 29½-foot pole. One of my company's software vendors uses OCI for the
cloud-hosted version of their product, and we've had all sorts of random
issues that make me really really really want to install the "on-prem" version
on some Windows instances in our own AWS account. Maybe we're just an outlier
and Zoom will have better experiences, but something tells me that given
Zoom's scale the issues will only be amplified.

Given that it's an Oracle product, I can't imagine it being cheap in the long-
run, either, so I seriously don't know what the value proposition is there.
Sure, maybe Zoom got a good introductory price given their scale, but... eek.

------
DevKoala
Do people questioning the intentions of this move, have actual experience
using Oracle cloud?

It seems that people really eat the marketing that AWS/GCP/Azure are the best
cloud provider for every single product.

Oracle Cloud's perception is in the gutter, and it's all press. It's very
possible that they have a competitive cloud service. They were making some
decent offers for talent last time I checked.

~~~
jedberg
From what I've heard, the top talent they are hiring are not being allowed to
actually do anything useful. They are getting paid to be in the PR.

Maybe someone who actually works on Oracle cloud can jump in here and clarify.

~~~
alpha_squared
> Maybe someone who actually works on Oracle cloud can jump in here and
> clarify.

I'd love to, and I'm sure others would as well, but I'm not sure what can be
said that wouldn't run afoul of legal.

~~~
jedberg
The fact that you're afraid of what legal might think of your response says
volumes in and of itself.

~~~
enitihas
Which company employees aren't afraid of what legal might think?

~~~
jlgaddis
Pretty much any HN comment thread even tangentially related to "cloud" usually
has comments from employees at AWS, Azure, and/or GCP -- you know, Oracle's
three primary competitors. -- not to mention many other big tech companies
(Facebook, Netflix, IBM/RedHat, and so on).

~~~
grogenaut
Amazon updated their guidance to employees a few years back that we could
share our own opinions freely online. That was after the but article and many
happy amazonians pointing out they were hamstrung from posting their
experiences online. It just seems smart from a customer trust and recruiting
standpoint.

Don't leak material information or customer data tho. Which can make it hard
as some of the best stuff is secret or customer related. Filters abound.

It was weird moving to twitch which was default open before this switch as the
two policies were in conflicts.

I think this is better overall. And I enjoy the insights from aws folks and
gcp, and the sparring that goes on.

I don't know anyone who went to Oracle cloud and was happy, but apparently
they can't share their opinions

------
kraavi
“We chose Oracle Cloud Infrastructure because of its industry-leading
security, outstanding performance and unmatched level of support.”

Zoom stressed security first, Oracle's executive team has a close relationship
with the current administration. I wonder if this is a lobbying play in light
of China centric security concerns.

Oracle isn't exactly known for its security, that would be Microsoft or
Google.

~~~
lucianf
Care to support that comment please? Mind you, talking about cloud platforms
here not parent companies.

Not a salespitch, but Oracle Cloud Infrastructure (OCI) is built with pretty
serious enterprise-grade security in mind. Couple of resources:

[1] [https://www.oracle.com/a/ocom/docs/oracle-cloud-
infrastructu...](https://www.oracle.com/a/ocom/docs/oracle-cloud-
infrastructure-security-architecture.pdf) [2]
[https://www.oracle.com/assets/oracle-inf-cloud-security-
wp-3...](https://www.oracle.com/assets/oracle-inf-cloud-security-
wp-3840537.pdf) [3] [https://docs.cloud.oracle.com/en-
us/iaas/Content/Security/Co...](https://docs.cloud.oracle.com/en-
us/iaas/Content/Security/Concepts/security_overview.htm) [4]
[https://blogs.oracle.com/cloud-infrastructure/the-four-
pilla...](https://blogs.oracle.com/cloud-infrastructure/the-four-pillars-of-
oracle-cloud-infrastructure) [5] [https://blogs.oracle.com/cloud-
infrastructure/core-to-edge-s...](https://blogs.oracle.com/cloud-
infrastructure/core-to-edge-security%3a-the-oracle-cloud-infrastructure-edge-
network)

------
notyourday
For businesses that actually have users the biggest cost is not instances, it
is the per byte billed network cost, including cross-AZ cost.

AWS cross zone traffic within the same region is not free:

[https://www.lastweekinaws.com/blog/aws-cross-az-data-
transfe...](https://www.lastweekinaws.com/blog/aws-cross-az-data-transfer-
costs-more-than-aws-says/)

and I distinctly remember getting bitten by the same kind of a bill at Google
for traffic between their AZs within the same region, which makes me guess
that Azure has the same business model.

If Oracle offered Zoom free traffic inside the region between different AZ's
then it demolished AWS and GCP pricing.

------
baggy_trough
Why the hell would any business get into bed with Oracle if there is any
alternative to it? That sales team is merciless, and the money will be
extracted to the point that the victim is half dead, once the hooks are in.

~~~
caseyf7
Are you sure you're not talking about Google Cloud?

~~~
baggy_trough
I wasn't, no. Is their reputation as fearsome as Oracle? I have personal
experience with both; only Oracle was regrettable (so far).

~~~
caseyf7
The last few years Google Cloud sales reps have been much more aggressive.
They walk in wearing Gucci loafers, talking about their MBAs, and telling us
we need to spend 50% more this year. With the new GCP head from Oracle, I
wouldn't expect it to get better, but glad to hear others are getting better
treatment.

------
zentiggr
Well, here you go, Zoom disruptors - they just tied a lead weight around their
neck, time to go to and eat their lunch.

~~~
rrmm
Who do I root for?

------
hasperdi
Unless Oracle is doing it for free, I see little reason to go with them

~~~
mmastrac
Totally guessing here but I imagine this is a super cheap deal for Zoom.

~~~
bitcharmer
At first :)

------
president
Oracle was one of the first major enterprises that converted to Zoom for all
their internal communications. Maybe there was already some sort of connection
or special relationship between the two companies early on?

------
lowdose
Are the same people saying don't do GCP because Alphabet kills all products
now commenting Meet is a valid excuse for Zoom to migrate to Oracle as a first
choice?

Cognitive dissonance anybody?

------
node-bayarea
Remember Salesforce is a big investor in Zoom. And they have a big partnership
with Oracle. Most of Salesforce DB runs on Oracle DB. They might have
influenced.

------
sanguy
Somethings as fishy as Zoom's encryption here....

------
bearcobra
My understanding is that they already use AWS and Azure, so this probably
isn't the case, but I wonder if the fact that the other major vendors have
competing services influenced this decision.

------
byteQualia
A more realistic perspective on why Zoom chose OCI:
[https://www.lastweekinaws.com/blog/why-zoom-chose-oracle-
clo...](https://www.lastweekinaws.com/blog/why-zoom-chose-oracle-cloud-over-
aws-and-maybe-you-should-too/)

------
bosswipe
Somewhat off topic, but I've found Zoom to have such better video quality then
all the other big players I've tried that it leaves me wondering why, do they
have some secret sauce for streaming that other don't?

------
blackrock
At some point, it’s gotta be cheaper to just buy your own servers, and build
your own cloud. Or at least rent some colocation space.

Why keep renting expensive resources, when you can just own it outright.

------
geogra4
Oracle seems to be pushing OCI really hard to Oracle DB customers.

------
cczizou
We need some more competition. Maybe a real-life Pied Piper.

------
Jonnax
Is Oracle cloud any good? Is it like the other providers where you can take a
credit card and use?

Or do you need to give your soul to oracle?

~~~
ganstyles
No, it is really trash. It's down there with IBM cloud. I've worked with it
(and IBM) extensively, and with AWS/GCP (but not azure too much yet,
interestingly). Depending on what you want AWS/GCP/Azure are largely fungible,
Oracle and IBM are really lacking just about everything you could want, and I
would be hesitant to call them "cloud" except by the barest definition of the
word. Also worked with another one, who I won't name, but scaling your
instances required filling out paperwork and sending it in. Oracle wasn't
quite that bad, but they're down there.

~~~
lucianf
That's really unfounded, unless you're talking about an experience you had
years ago when the platform was still in the early stages.

The current Gen 2 cloud (OCI) is very much capable. I would strongly suggest
you either have a high level look at the products available (start here [1]),
peruse the documentation [2], or have a go yourself with a free account [3].

Happy to continue this chat about actual products you thought were lacking, or
your experience.

[1] [https://www.oracle.com/cloud/](https://www.oracle.com/cloud/) [2]
[https://docs.cloud.oracle.com/en-us/](https://docs.cloud.oracle.com/en-us/)
[3] [https://www.oracle.com/cloud/free](https://www.oracle.com/cloud/free)

~~~
ganstyles
Last worked with it maybe a year ago. I have a lot of SRE experience so deal
with this stuff directly, and I'm giving you my experience and the experiences
of my colleagues. It's anecdotal of course, but not unfounded.

------
ABeeSea
Another red flag in regard to Zoom’s security.

------
SXX
I guess Zoom have choosen Oracle cloud for it's horrible UX. Both give me the
same chills when I look at their UI.

~~~
tpetry
They have no secret sauce. Every other service favors bandwidth savings over
video quality, zoom did the reverse.

------
m3kw9
At a time like this $$ matters a lot. Must be a sweet sweet deal.

------
killjoywashere
Paint me paranoid, but I think this is a move by Beijing to get closer to
Oracle, which provides support for (and thus has access to) many US Government
databases.

------
abledon
first times a tragedy (security), second times a farce

------
gameswithgo
oh no

------
alephnan
In the article:

> Zoom selected Oracle to expand its cloud, bypassing major industry leaders
> Amazon Web Services, Alphabet’s Google Cloud Platform and Microsoft’s Azure
> Cloud.

I guess GCP isn't significant enough to be in the headline

~~~
king_magic
... huh?

"Alphabet’s Google Cloud Platform" __is __GCP.

~~~
adrianmonk
In the headline. The headline is "Zoom taps Oracle for cloud deal, passing
over Amazon, Microsoft". Which doesn't contain any of "Alphabet", "Google", or
"GCP".

