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Warren Buffett sells his Oracle shares, retains $44B investment in Apple (zdnet.com)
325 points by MilnerRoute 21 days ago | hide | past | web | favorite | 260 comments



This past year I spoke at Oracle's Code One conference in San Francisco for the first time. I've never used Oracle products before and had never been to an Oracle event before, but I was aware of Oracle's incredibly bad reputation in the dev community.

When I got to the event it was MASSIVE. I think they have something like 30k+ attendees.

As I was walking around, hanging out, and attending talks, I decided to make friends and chat up other people. This is where things got interesting.

Through the 2 days I was at the event, I probably met nearly 100 developers, and when I asked all of them what they use Oracle for EVERY SINGLE ONE OF THEM openly told me that their companies use Oracle right now but they hate it and they were all in the process of transitioning to other providers or open source solutions.

Every single person I met at Code One told me the exact same thing.

That is pretty insane and I don't think it bodes well for Oracle that all of their customers are trying to find ways to get out of their ecosystem :x


It's not because of poor Oracle reputation, it's because of technologies. Oracle is losing database-related markets.

15-20 years ago Oracle was №1 in database-related technologies and everyone knew it. For that time they had almost perfect solutions for most database-related problems on market. But market is changing. Today they stuck with their good solutions for outdated problems and their solutions doesn't solve modern problems well.

So here is my short list of modern database-related problems, for which I think Oracle is not best at:

- files/data storage (today there are better non-database solutions for that, 15-20 years ago it was a good practice to store files in database),

- full-text search (10-15 years ago substring search was enough, today we want complex search criterions),

- consistency across data centers,

- key-value cache (today we want almost instantaneous cache answers),

- OLAP (there are faster solutions on market).

15-20 years ago Oracle was one and only one solution for almost all database-related business problems. Today for many modern problems there are better solutions than Oracle.


Twenty years ago most of the databases we've come to trust were still quirky and strange (Postgres before SQL) or toy-like in capability (MySQL on MyISAM). A lot has changed since then.

Competitors like DB2 and Sybase seem to have utterly faded away, so it's surpising that Oracle's still a factor at all.

Is there anything that Oracle still does that nobody else can match?


Well, it's undeniable that as an OLTP RDBMS, Oracle is very good, at least if you ignore the complexities of managing it. Almost nobody can beat it on features.

For example, consider partitioning. Oracle has had seamless predicate-based table partitioning for about 20 years now. Postgres is getting there, but is still lagging behind. With Oracle you just tell it to partition by some expression(s) and off you go.

Then there are things like multi-master replication, bitmap indexing and other nice features. Oracle is also extremely fast. The underlying table storage is very pragmatic, with a hybrid MVCC system that has both an undo and a redo log. Tables are written in-place, and transaction contention is handled by linked lists of records to the undo log, so getting an older copy of a row is still almost as cheap as Postgres.

Of course, it's beaten in some areas. It's not great a full text search, I believe. Compared to Oracle, Postgres' transactional DDL is positively magical. With Oracle and nearly every other database out there, things like "drop table" can't run inside a transaction.

I would never want to work with Oracle, but I can't deny that it's got some great features.


Sales. What I hear from friends in big co's is that the decision to use Oracle is made on the golf course and not in engineering. Engineering is actively moving to the other technologies, and eventually the companies will stop paying for Oracle because it is no longer in use.


Thanks for pointing me to "Postgres before SQL" - the history page at postgresql.org has links to the initial documents - QUEL is like a hint of an alternative universe. I think it is time to pick up a book by Michael Stonebraker.


And thank you in turn for the reference. It does indeed sound very interesting [1]. I had never heard of QUEL either [2].

[1] https://www.postgresql.org/docs/8.4/history.html

[2] https://en.wikipedia.org/wiki/QUEL_query_languages


SQL Server is a fork of Sybase’s code, so the child product became much more popular than the parent.


My understanding is that it's a complete rewrite, perhaps more than once at this point.


Probably, but it started as a fork. Last I looked a T-SQL programmer can adapt pretty quickly still.


If you are doing financial services like insurance or banking, you might be stuck on Oracle because you need active active worldwide database replication and none of the 1st-gen NoSQLs offer global ACID transactions. As someone who's been working in databases for over a decade I've seen customers develop database evaluation strategies, but still be unable to migrate away from Oracle. That is changing with the distributed ACID transactions offered by databases like my employer FaunaDB.


Doesn't Spanner support ACID transactions?

(Disclosure: I work for Google)


Yes it does.


> Is there anything that Oracle still does that nobody else can match?

Selling to enterprise.


which is so odd to me, I use DB2, in that our AIX/Oracle teams have many people working as "DBA" but on our DB2 iSeries there are two of us and our data sets are as large. The difference is there are so many things that the iSeries does automatically that it makes being a DBA a breeze.

I really need to get an understanding of the issues the Orcale team faces one day but they tend to look down on us and the pc groups


When oracle corrupts data, you have to google magic incantations and type them in console. I did that many times. But what I never understood is why do I have to do so in the first place, why Oracle does not self-heal itself.


Consultant income driven development.


Sales, and sailing.


It's true. Postgres doesn't have a very competitive America's Cup team.


Active-Active clustering also know as Oracle RAC.


Suing people.


Oracle isn't great in the cloud or with autoscaling either. With the move to microservices it is less important to have one giant centralized database, and "less good" alternatives have become good enough. Oracle is pretty much the opposite of agile when it comes to facing these challenges.


A lot of Oracle customers got oracle products 15 or 20 or more years ago. A lot of those developers, sysadmins and data base admins that have worked on oracle themselves are now into senior Management and executive positions. I wonder how much this has to do with transitions. That they know it sucks, so they are more willing to fight beyond standard "it's expensive" arguments.

A bit of a shower thought, I have no evidence for this.


Speaking from my probably limited experience compared to others here, these early Oracle adopters turned senior/management you mentioned actually are the ones I saw fighting hardest to keep Oracle around. That is all they know and all they ever have known. In some cases even lying about other technology assessments and flat out sabotage to make sure things aint change. The most vocal pushback against Oracle I saw was from people who were not early adapters and had experienced other systems.


There are a few companies who could all have the same slogan, but I’ll use Oracle in this example...

Oracle: we make the stuff that other people make you use.

Other candidates include (but not limited to)

- Atlasian - Microsoft - Adobe


Microsoft’s development ecosystem (e.g. SQL Server, .NET) is top notch, even if you hate Windows and Office.


As a Microsoft Development Technologies MVP, I can tell you MS gets it and has made huge progress in usefulness and usability of the DotNet ecosystem. Keep in mind there are on the order of 1M C# developers worldwide. Most in enterprise environments and most belonging to the dark matter developers. They don't hang out on HN, Twitter, go to conferences, write blogs, or even read them. This will keep MS dev ecosystem development focused on C# and object oriented for the rest of my life. But I can tell you all the MS techies in .NET development are interested in and respect F# and functional programming and want to see it succeed. There has been pain getting to cross-platform .NET, which is what NetStandard/NetCore is all about. It is pretty stable and useful today, and there is a lot of wood behind the development arrow going forward.


I love C#, and have been using it since the 1.0 days back around 2002. What has really annoyed me as of late is the confusing branding. Standard vs Core vs what the hell is Framework 4.7 called?

Along with the branding confusion, the formally very approachable and discoverable MSDN documentation for the class library has become a near useless clusterfuck. They've deprecated made.microsoft.com/library/ (at least for .Net) but don't mention it on the site!


> What has really annoyed me as of late is the confusing branding. Standard vs Core vs what the hell is Framework 4.7 called?

I agree that it's confusing at first, but when you step back and look at why Microsoft went down this path, it starts to make a lot of sense.

When .NET was launched in 2002, it was a closed-source, Windows only development framework.

Microsoft was a very different company back then, and Windows was its gravy train. If you were a developer inside the Windows ecosystem, you were showered with (closed-source) love. If you were outside? Well, fuck you, Microsoft will crush you. Everything was oriented towards getting retail/enterprise consumers to buy Windows (and Office etc).

The 180 degree flip to embrace open source is a very recent development. Microsoft realized that desktop OS's were less and less relevant commercially, and that the future was in cloud services.

I haven't looked at the figures, but I assume it's a lot more lucrative to lock in tens of thousands of dollars per month in cloud subscription/support fees than selling Windows direct to consumers.

So with this reorientation, Microsoft needs a strategy to capture the cloud services market (and keep in mind that this is 5-10 years after AWS has been running the shop).

The solution? Open source .NET to accelerate its adoption and entice developers towards Azure.

First, Microsoft won't care if you use their implementation of .NET or Mono - as long as you're using it on Azure, you're fine. Hence .NET Standard - literally, an open-source standard that anyone can code against, and know that their stuff will just run, no matter which implementation is used under the hood.

Second, Microsoft then release their own implementation of this standard - .NET Core.

Third, we come to .NET Framework. For most entrants to the ecosystem, you can consider this to be legacy. This is the evolution of the original (2002) closed-source approach to .NET, and is only sticking around due to Microsoft's long-term commitment to its software releases.

Again, I agree that none of this is clear when you're new to .NET. It makes a lot more sense when you realize the naming evolved from Microsoft shoehorning a legacy platform into a fundamentally new, open-source/SaaS subscription strategy.


I'm an F# coder in a company of C# "dark matter developers". (Thanks for that term!) There's no ecosystem I'd prefer to be working in than .NET.


Could you elaborate on what are missing parts in other ecosystems than .net/c#


I don't have a lot of recent experience with other ecosystems, so take what I say with a grain of salt. With that disclaimer in mind:

* Visual Studio is the best IDE, bar none. It's a pleasure to use and Microsoft keeps it up to date so it's usually bug free for normal use. I don't even know what its serious competitors are. Eclipse? VIM? Forgive me for not knowing. :)

* C# is the best OO programming language (if you don't need the raw speed of C++ or, I guess, Rust). Java is a disappointing mess controlled by, yes, Oracle. Python and other dynamically typed languages are fine for scripting, but not for developing complex professional software.

* F# is the best functional programming language for getting stuff done. In fact, it's the best language for getting stuff done, period. Haskell is amazing for its mathematical purity, and I've learned so much about FP and category theory from the Haskell community, but F# gives you immediate access to the zillions of packages created for the .NET ecosystem and is totally compatible with C#. You can also use F# for imperative OO programming when you need to (which is almost never).

* SQL Server is the best RDBMS. Oracle is painful. The open source databases (PostgreSQL, MySQL, etc.) have come a long way, but still don't have SQL Server's combination of power and ease of use. NoSQL databases are interesting, but seriously lacking in important features. I've yet to come across a use case where I would actually want to use one. (Special demerit to MongoDB for using JSON as a query language. Good lord.)

* Windows is fine. It's not Unix/Linux, but it lacks for nothing.

If I had the time to investigate other ecosystems, I'd like to pick up Rust and Haskell. I'm afraid that Python and JavaScript will eat the entire world, before then, though. :)

All of the above is massively IMHO, obviously.


Having switched from the Windows ecosystem to Linux a while back, I have a few comments:

I don’t know how bug-free VS is now, but VS 2005 and 2008 were buggy in problematic ways. Support was friendly, but the bugs didn’t get fixed quickly. IntelliType (for C++) was nifty bug extremely buggy. Switching to emacs was a major step back in usability, but it was enormously faster and it tended to just work.

C# has a top notch compiler. Sadly, MS’s C++ compiler was, and mostly still is, pretty bad.

Getting off of Windows was a big win. Managing a Linux machine is much nicer, and, when something doesn’t work, you have a better chance of figuring out why.

I have no experience with SQL Server. MySQL and PostgreSQL both sucked back then.


Honestly, C# has replaced C++ for the large majority of Windows application developers. Developing C# apps in Visual Studio is basically frictionless in a way that C++ will never be. C++ as a language (regardless of IDE) is a major pain in the butt.


My big Windows program wasn’t a Windows “application”. It was high performance software that happened to run on Windows. C# was not even close to being in the running.

If we were starting from scratch, Rust would be a credible contender.


I think Haskell is a very nice general purpose language. I think of it as a better Java. There's no need to think of it as a scary academic thing, unless one focuses on the wrong kind of blog posts. https://patrickmn.com/software/the-haskell-pyramid/


I don't mean to knock Haskell at all. It's a fine language with a great community around it.

That said, the number of commercial applications developed in Haskell is very small, because, I think, it doesn't integrate as well into the larger ecosystems around it. It seems like it's a beautiful island all by itself.


The number of commercial applications developed in functional programming languages as a whole is pretty small compared to mainstream languages. I am a dotnet dev and also like F# a lot, but I cannot think of very many commercial applications written in F# either.


That's true, but for someone like me in a C# shop, I can slip F# code into our apps seamlessly. No one would say the apps are written in F#, but several key components are.

Hopefully, FP will take over the world soon and Haskell and F# will both be at the top of the charts! :)


yeah, very cool you were able to find a way to write some F# at work, I wish I could too.

Given trends, I don't expect to see any exponential growth though.


I've found VS 2017 a step down from VS 2015 with way worse performance on iddentical workload and PC.


Does C# have multiple dispatch ala CLOS?


No, it has single dispatch virtual methods, a la C++.


That is not my experience. I've been shipping code for >20 years across a ton of platforms. MS tech has always been a snowflake headache.


Eh... i’d disagree. But what do you mean by “Top Notch”?


See my reply elsewhere in this thread.


I left the MS ecosystem years ago and still miss MSSQL. The full toolset was (is?) very powerful and developer friendly.

I know there are some free tools, but for me nothing out there compares to Adobe Lightroom.

IMO, none of those companies are in the same ballpark as Oracle.


Take a look at the "Most Loved" and the "Most Dreaded" databases here:

https://insights.stackoverflow.com/survey/2018/#most-loved-d...

It's pretty clear that MSSQL is seen rather differently from DB2 and Oracle (which are #1 and #2 on the "most dreaded" list, respectively).


Yeah but... at the risk of sounding like a dick... is stack overflow the best place to guage opinion on such things? I mean we’re essentially asking the people who post questions like “why is my HTML table not look right?” To posit an opinion on what they consider best of class in a whole bunch of categories that they’re probably novices at.

I think it’s pretty clear that the people with the best opinions on SO are vastly outnumbered by people with unqualified opinions. Surely something like Simpson’s law can be applied here. Like - of the people with n amount of accepted answers for any given tag - what is their opinion on something related to that tag?


The people who ask why HTML table is not looking right are unlikely to express a strong opinion on Oracle etc either way.


Are you sure? I suspect that they’re the people most likely to participate in those polls.

I personally can’t be bothered with these kinds of questions, but I remember that back in my early days, I was something of a zealot when it came to things I knew vs things I didn’t. I cut my teeth on PHP, MySQL and Flash/Actionscript. Had you asked me back then how I rated those things, I’d have given them 10/10, despite having nothing to compare them to.


Look at the description of the that the poll asked:

"% of developers who are developing with the language or technology but have not expressed interest in continuing to do so"


I think DB2 depends entirely on what platform you use it on.


sure sql studio that has the same problems like the last time i used it 10 yeaars ago, lol microsoft you cannot refresh the side view after i make changes, so i have to hit refresh constantly.


None of those companies have non-executive customers who exclusively hate them. Oracle is unique in this regard.


Salesforce's Dreamforce conferences are similar. There were 120k attendees the year I went.

No developer (or not a lot) would knowingly choose Salesforce as a tool, yet all these folks are at the conference because the employer paid them to go.


I don't think that comparison is really valid. I know tons of companies that run virtually all of their CRM on Salesforce, and this isn't going anywhere soon, nor do these companies have anything that they are planning on transitioning to.

With Oracle, though, I think it really is a lack of technical positioning rather than any "devs hate them" sentiment that is a real existential risk to them long term. Lots of senior execs realize that Oracle's cloud technology is a joke, and more importantly their crazy licensing model makes it a major PITA to run Oracle DBs in any other cloud, and perhaps even more importantly that a lot of changes in dev architecture are making the huge, powerful, monolithic database less critical than it once was. Sure, there are lots of legacy mission critical apps that live and will live on Oracle for a long time, but executive leadership at many companies is now starting to see this (appropriately IMO) as a competitive disadvantage, and they will make choices to try to extricate themselves from Oracle as much as possible.


Don't forget PEGA. Management love PEGA and Salesforce.


I sold my ORCL a couple years ago (had held it for 20 years) for just that reason. A company whose customers use their product because they have to rather than because they want to is doomed. The same for Novell stock back in the day.


The last straw for me was when I read they were suing their customers.


So Google is doomed? (I think it is.)


Google's primary service is selling search ads that consumers view, primarily via search. Consumers have almost no lock in, and consistently choose Google search over Bing, etc. Google is not at all like Oracle in this case.


Google's business is selling ads to companies and agencies (which hate Google) and selling ad display tech to websites and publishers (which hate Google). They buy companies (Urchin, Doubleclick), make them free, destroy competition, introduce pricing. Pretty identical to the bad guys in tech history.


Even if that's true, it doesn't matter. Consumers are using Google, so there is not really a free market for search ads from thee marketers' perspective.


I don’t like google but I use a lot of their products and of course am involuntarily tracked by them all over. I can hate them all I want, but I’m not their customer. So they have that going for them...


There's an interview with Ellison "Oracle is destined to beat Amazon at cloud database" oct 2018 https://www.youtube.com/watch?v=xrzMYL901AQ

where he's chatting about some of his customers hating Oracle and wanting to get off, specifically Amazon and SAP. But he says they don't because the Oracle database is better and the other systems don't work properly.


I think it’s pretty insane that it’s taking companies this long to transition away from Oracle.


Many of the Oracle system I worked on were huge. Hundreds or thousands of stored procedures that would have to be completely rewritten. Migrating the data...that is easy. Staring down a 10,000 line stored procedure is daunting.


It’s funny, I first bought Oracle in 1999. Every Oracle user I talked with that year said the same thing. They all hate Oracle, they were all switching.


It always amazed me that a primarily database company was worth that much money, since PostgreSQL is free and insanely well documented.

It’s like a Fortune 500 company being based on selling the bash shell and tools for using bash.

Open source for infrastructure level software has historically been wildly successful.


Isn’t that exactly what Red Hat does? And Warren Buffet even just bought a stake in them.


Probably because Oracle has been pissing off their bread and butter for years and it's starting to bite them.

Amazon got the gov cloud contract. Oracle's suing, but all they have is that someone jumped from the DoD to Amazon. https://www.nextgov.com/it-modernization/2019/02/pentagon-in...

Also, I've heard stories at other .gov datacenters where they're trying to phase out Oracle as fast as they can because they're tired of their crap. Like last time I checked Oracle DB charged based on the number of CPUs you _could_ be running on. So if you have a modern env that dynamically provisions across a datacenter, then they charge for all of the cores in your datacenter.


We got hit by that.

Oracle used to charge us per physical core on our production nodes, with a discount for development and backup/spare.

Then suddenly they changed how it was licensed and our bill jumped up 4x (we're talking a six figure increase).

We negotiated it down somewhat (closer to a 2.5x increase as a "goodwill discount"), but since then have been quietly making changes to the code-base to make a future SQL Server migration easier. We have four years left in this contract, and we hope to be ready by then.

We're on Oracle at all because we used to use their application development suite (ADF, Forms, etc), but those all either got discontinued or turn so sour you don't want to be using them, so now Oracle DB is just a remnant.


If you don't mind me asking, how is the SQL Server as far as price goes? I know Oracle is very expensive, is SQL Server cheaper for a similar usage pattern?

Also curious, what made you decide not to use PostgreSQL (or EnterpriseDB if you need entreprise solution)? Was it a technical reason or are you more comfortable with MS solutions in general?

I am asking because I have mostly used MySQL (pre-Oracle) and now PostgreSQL, and have always wondered what made people choose either Oracle or SQL Server. I have met both in different jobs - I hate Oracle with passion because of their licensins shenanigans, and wasn't impressed by SQL Server (though that might be in part that I was using it with SharePoint, which was... something).


> If you don't mind me asking, how is the SQL Server as far as price goes?

You can use this to get a very ballpark idea:

https://wintelguy.com/mssql-ent-licensing-calc.pl

From actual quotes at full price, we'd be paying around the same to Microsoft for SQL Server Enterprise than we were paying Oracle BEFORE the price hike/license changes. However that doesn't include discounts which most organizations running any Microsoft software at all would be eligible for.

So in other words: Almost always cheaper than Oracle Database. Varies between a little cheaper and substantially cheaper. Both companies are trying to drag you towards Cloud however, so there's deeper discounts there right now (it's a trap!).

> Also curious, what made you decide not to use PostgreSQL (or EnterpriseDB if you need entreprise solution)?

No one person decided. This is a large organization that moves slowly and is fairly conservative. Plus the costs of migration are high, if migration fails people in management will suffer (either to their career or just outright be transferred/fired).

So in other words "nobody gets fired for buying Microsoft" or w/e. It certainly doesn't hurt that it is much easier to hire/contract in SQL Server talent than PostgreSQL. Technical considerations play a part, but only up to the point where it has to have what we need.

> I am asking because I have mostly used MySQL (pre-Oracle) and now PostgreSQL, and have always wondered what made people choose either Oracle or SQL Server.

That's because you're considering what is best using logic, reason, and technical facts. In the enterprise space more often than not major companies just follow the crowd, with a handful of trailblazers setting the standard. Oracle and SQL Server are popular because they're already popular, in a fully circular way.

If I started a business tomorrow I'd use PostgreSQL. But if I was a C-level in an enterprise and my career is on the line, I am going to be sticking with SQL Server.


They also get picked because they have excellent vendor support behind them. As well as third-party ecosystems.


This. If you are c-level you aren't touching the code, but you like the idea of paying the people who built the thing a support contract so you can call and yell at them when you misuse the product and it falls over.

The alignment between product support and product builder is muddier for c-levels to follow.


> Also curious, what made you decide not to use PostgreSQL (or EnterpriseDB if you need entreprise solution)?

Keep in mind that MSSQL enterprise comes with a lot of tools beyond just a RDBMS. That was always the hangup when I have tried to move companies from MSSQL to something like PG.


Can you give example of several useful tools in the MSSQL garden?


Sure. Two of the main ones I used were MSSQL Analysis Services and Integration Services.

I built and managed a data warehouse/internal reporting system for a fairly large telecom. I used ~100 ETL packages built in SSIS to pull in data from systems all over the company, SSAS to process the data and SSRS to build reports. It worked pretty well at the time 10+ years ago.


SQL Server now uses the same licensing strategy as Oracle in virtual environments.


SQL Server offers two different license models (at Enterprise tier). Per physical core or per virtual core.

If you license all the physical cores you can run as many copies of SQL Server as your infrastructure will allow.

If you want to run SQL Server as a partial part of a private cloud then licensing per virtual core could be a significant savings in some circumstances. This is because physical cores used for other things won't require a license.

This article has more info:

https://blogs.flexera.com/elo/2017/06/an-introduction-to-mic...


Citation needed


I sense Oracle soil will collapse quite fast. JVM speed can only keep people interested so far .. and a lot of smart people are into language and compilation these days.


From my observation it’s much easier to recruit Java devs than Node devs, for example (I’m located in an average city, not a leading one like SF or NY). I’ve closed my Node projects because it seems to be too early to recruit and train interns in this area.


Being able to easily recruit programmers in a popular stack says nothing of their quality as professionals though.

If anything, I've seen a lot of non-programmers disguised as Java programmers. Armies of them in enterprise teams. A truckload of expense for not much gain.

I'm not saying it's everywhere like that of course. I've met brilliant Java developers when I contracted for SAP.

So how do you deal with such a risk?

If I had to hire I'd search programmers of less popular languages -- and only 3-5 of them. These people tend to be insanely productive and have very good perspective and culture.


It’s a running joke in companies that Hibernate/JPA helps us abstract from the database « in case we change DBs », and how it never happens because we’re tied to specifics of the DB anyway (Oracle counts nulls = empty strings, for example).

I guess the day has come to make use of this feature.


This is not entirely true. Hibernate/JPA has lots to dislike but it does have constructs for different databases and while it’s not a snap to change db’s It’s not even that bad. We did a recent change on a fairly large application and it took us 3 weeks. 1 week dev and 2 week testing.


It's definitely not a myth. Jira supports PostgreSQL, MS SQL, H2, Oracle. I think that Hibernate helps tremendously with that. Sure, you have to take extra care anyway, but the differences between databases are real and there's enough code in Hibernate to smooth those differences.


Jira doesn't use hibernate.


I'm in the same boat. Default was Oracle, but now we have more options. The order of preference per management is Postgres -> SQL -> Oracle. New applications need a deviation to use Oracle.


You don't even have to be dynamically provisioning anything, even just standard VMware virtualization is not approved for running Oracle DB. They'll audit you and charge you for every physical CPU core connected in your vSphere cluster. It's total bullshit and their big customers are getting sick of it.

Oracle audits are basically just sales tactics to get you to buy their cloud services so they can turn around and pretend they're a leader in the cloud.


It's also a push to get you to buy Exadata/Exalytics appliances, since the lock-in is harder, and margins are bigger.


How do they enforce a audit? What is to stop a company preventing them access?


It's generally built into the contract. Don't let them audit? Lose all your licenses.

A bunch of their stuff phones home too.


They did get a nice short-term windfall by changing the JDK license. Which will fall away in a couple of years as everyone shifts to OpenJDK or something other than Java.

I'm also seeing big stodgy companies getting more comfortable with things like Postgres. It will take a while, but barring some big change, Oracle is headed down long term.


Oracle is not a tech driven firm. It is sales driven, meaning their sales teams are world class at ingratiating themselves with decision makers at "big stodgy companies". How do you explain why they survived all this time. Very very few of the top Tech firms use any Oracle software for atleast the last 10-12 years now. Some even have internal procurement bans!


They USED to have world class software. Compare Oracle DB to the competitors 10 years ago. They were at least GOOD. Lots of good features for giant companies.

Competitors have gotten a lot better over the last 10 years. Oracle has mostly just raised pricing. It works for a while, but at the current path I don't see Oracle the company existing in 20 years.


I would say arguably they ARE still world class. It is just most people don't need or cant justify their price tag when competition has caught on with clear Roadmap and sustainability.

So basically they have a shrinking value proposition and they are rising prices. ( Why does that sound so much like Apple, Now I am worried )


I love my earpods and I think it shows they still are at the top when it comes to innovating on consumer devices.

Using Apple Pay also makes so much sense for the consumer as it limits your CC data being at every retailer since Apple Pay tokenizes the sensitive information.

If you want to see where Apple is going, checkout the Apple Healthkit API:

https://developer.apple.com/documentation/healthkit/samples/...

While it is too soon to say that Apple will own the market, Apple is the only big tech company that has positioned itself for privacy and trust, giving it the best chance to own this market of the big four.


“Good” depends on the use case. I used Oracle once, about ten years ago. The client library was so big and bloated that just loading it took the majority of the total running time of my not-terribly-long-running program.

Not to mention that figuring out the connection strings is so miserably complicated that you basically need a trained expert to figure it out. The docs were worthless.

I think I can spin up an entire blank MySQL instance faster than I could connect to an existing Oracle database back then.


Well if you don’t need the features then clearly you are not the target. The oracle DB is going to support many different things compared to your MySQL cluster.


I was most definitely not the target. But having such a miserable experience just accomplishing the basics did not make me at all inclined to consider Oracle for future projects.


>>> Very very few of the top Tech firms use any Oracle software for atleast the last 10-12 years now.

I think you missed the word "new" in there. Amazon finally is cutting ties with its Oracle DB this year. While I won't be surprised if AWS starts offering "migrate off Oracle" as a consulting service, Oracle was still the standard through the 2000s. I think they have built up so much negative goodwill though that no startup would ever consider using Oracle even if they gave the first five years away for free.


> While I won't be surprised if AWS starts offering "migrate off Oracle" as a consulting service

If AWS can offer a database that satisfies the Mongo API (DocumentDB), then why couldn't Amazon offer a database that satisfies the Oracle DB API, complete with automatic migration?

The day that happens is the day Oracle stock goes straight in the toilet.


I suspect that would resurrect something like the Oracle vs Google lawsuit, where an API signature is somehow a thing you can copyright.


The "API" is doable. Being binary compatible is not at all. Oracle DB is complex because of historical choices (the patch picking, compatibility flags) etc... inbuilt JVM and PL/SQL.

Those things that make working on OracleDB today difficult is what made it so dependable for people with money in the last 20 years.

It also runs on a lot of architectures that today's software is not really running on anymore.


Mongo was open source. They copied the api under that license.

My understanding, and I’m not a lawyer so don’t consider this legal advice, is that you can’t copy a commercial api or it’s infringing on their intellectual property.


The copyrightability of APIs (specifically Oracle’s APIs, even!) is at the heart of a lengthy and still-ongoing legal battle, with several decisions in both directions.


The mongo example is a bit odd since the open source license was AGPL. Sounds like you can copy an AGPL API signature without releasing your own source?


I thought the copyright law had an exemption for compatibility?


See https://www.eff.org/cases/oracle-v-google

Oracle won the last round, Google asked the Supreme court to look at it in January. Guess we'll know some time soon.


It would probably turn into the ultimate cigar butt stock though as long as they didn't keep spending money on crazy acquisitions and the stock fell 40% on the news.

I would have to think so many organizations have random scripts, etc. that the risk vs. reward still won still be high er than you think, especially when say the CTO of JPMorgan's job depends on "knowing Oracle."

Personally, I think IBM will likely crash and burn way before Oracle does.


Sure, not disputing how they got where they are. I'm speculating that none of that helps them from here. Big stodgy companies, their bread and butter, are now tired of Oracle's shit. And, they now have lots of credible options.


How are they doing their financials?


The entire Amazon retail business is on Oracle DB.


It was migrated away to aurora


I don't understand their java strategy at all. By making the switch that they did they forced into existence Amazon Corretto. There's are lots of companies that, rightly or wrongly, want a big corporate name behind a piece of technology they are relying on. IBM and Red Hat were already there, but no CTO is going to have any objections to relying on Amazon over Oracle.


It also may be the last kicker needed for some to start moving to Node, Rust, Go, etc.


Maybe, but I doubt it.

Java is in a rather secure place right now. Everyone that chases the new shiny is long gone but it’s not yet at the point where it is difficult to hire for (e.g. COBOL).

So young buck comes to the CTO and says 'let's do a rewrite in Go' and the CTO says 'why in the world would I want to do that?' Then young buck says 'okay, what about just coding the new frobinator in Go?' CTO still says no, because then he’d have to hire Go programmers and Java programmers or at least waste time cross training. Young buck's less honest compadres have probably gone ahead and put Go into production here or there without permission, but I don’t think that’s a danger to Java.

What really changes this dynamic is when schools stop teaching Java.


Go is legit and a huge threat to java and other languages. My entire career has mostly been java based for the backend. The last few months all I’ve been writing is go. I’m finding libraries in Go that I can’t find in Java. I’m seeing lots of new tech all written in go. Go has all the momentum at this point.


My feeling is that they'll exist alongside each other in not very overlapping niches.

Java is what you write in, if what you're selling isn't the code but some service that the code provides, and you aren't a startup, and you can afford a support team and want a lot of devs.

Go is what you write in when you're selling the thing you made directly, like say it's a DB engine, or you're a startup and want low effort support and only want a few devs.


I imagine java is what a company would choose if they have a massive budget, but is unwilling to hire cowboy coders.

Java makes maintaining a feature easy, and the programmers hired can be average and still be able to make something of acceptable quality, in an acceptable timeframe.

A startup rather wants to move fast. Java is harder to move fast at - but Go probably has that in spades. I do believe Go will not succeed in a large, beaurocratic place. And as a start up grow out to become more and more beaurocratic, the tech transitions with it.


You could edit JVM bytecode by hand, but nobody wants to, we have tools for that. I'm sorely tempted to make a language that transpiles to/from all the Go boilerplate that shouldn't concern human beings.


Some of the boilerplate is likely to go away in new versions. (See new "check" syntax.) But the hidden advantage of Go has always been the ability to look at a function and just see what it does. That comes at the expense of boilerplate, but is worth it.


Whenever I look at some Go, it seems the "what it does" is buried in a big pile of mechanics that could have been generated. You're more likely to see half a dozen error-prone lines copying between slices than an obvious HOF named "filter".


Can you give me examples of what you mean? I agree some of it is low level, verbose even, but on the other hand, I'm able to figure things out on new projects rather easy, there's just fewer layers and magic things happening.


Wouldn't Kotlin or Dart be a better replacement for Java?


Go isn't just a replacement for Java, it's a step off the entire JVM and out of the ecosystem of heavyweight "enterprise" frameworks.


Go is heavyweight: its runtime doubles your memory usage and gives you an incredibly slow garbage collector, it also gets fast compile times partly by not optimising much. Source-wise it has a boilerplate problem practically as bad as Java's just in different ways.

Meanwhile there are lots of frameworks in the JVM world, some of them "heavy" with features, but if you want frameworks that are much smaller, github is overflowing with them.

Kotlin eliminates most of the boilerplate, leaving you with a slimline language, a powerful runtime and a wide choice of libraries. Go doesn't have much to compete with that.


Don't they teach Python now?


Based on my a limited view, if a new grad majored in something other than computer science+ but took some programming classes he or she is overwhelmingly likely to be most comfortable in python. However new grads with a cs degree+ are likely to have at least some and often quite a bit of exposure to java.

+ or software engineering, etc.


What is the practical difference between Oracle Java SE and OpenJDK? That is, why would you pay for it instead of immediately switching to OpenJDK?


They (mostly) didn't used to charge for their JDK. Up until recently, there were code differences. As of v11, there's supposedly no difference.

So, basically, companies need to move from Oracle JDK 8 to OpenJDK 11. And pay Oracle until they are done. It's a fair amount of testing and verification for some big companies. Now that it's costing them license money, they'll do it.

Edit: And, of course, many will also be incented to move off Java altogether.


There are a few odds and ends—IIRC some fonts, some gpu accelerated widget implementations for swing, and some obscure crypto options.

But the OpenJDK is the reference implementation and almost certainly has everything you need. The only reason to use OracleJDK is if you want to buy a support contract from oracle (NB there are companies, including very big ones, that will sell you a support contract for OpenJDK.)


There are almost no visible differences between Oracle and Open JDK now. Here's list of differences: https://jaxenter.com/oracle-jdk-builds-openjdk-builds-differ... basically it's some legacy support and their commercial offerings.


You would pay for it if you need support from the very creators of that software. Otherwise you would use free version. It did not change conceptually. All they did is made their offering more visible (and probably they will blackmail those who download stuff without thinking and reading licenses). You could buy support and use proprietary software before that change.


Support contract in order to have a lightning rod for blame if/when shit hits the fan.


It's pretty obvious that Oracle has been milking the government for decades. Those contracts and license fees that they get are just free money from taxpayers. Does any software developer still use Oracle products? Even Java started to lose momentum after Oracle acquired it.


I'm still enraged over the fact that Oracle got $300 million to make a website for Oregon's healthcare and failed. The website wasn't ready (nor would it ever be ready), and the whole state's healthcare was in tatters when the ACA came into effect. Oregon had to scramble to hire thousands of temporary staff and start processing paper forms to keep things running.

Oregon sued and ended up settling ostensibly for $100 million, but in actuality, it was $60 million in "customer service" and $25 million in legal fees.

Obviously, Oregon's government is culpable as well, but it's another data point to suggest Oracle is a dodgy sales/legal company posing as an engineering company.


I wouldn't be surprised if some of the government officials who made this deal possible are now working for Oracle as highly paid consultants.


Uh, I would argue Java had already lost momentum before the acquisition. Java 6 was released in 2006 and then stagnated; Sun had pushed a new version every two years since 1998, but 2008 came and went without a new Java.

Oracle bought Sun in the first half of 2009, completing in 2010. They actually moved to release Java 7 pretty quickly after that, there was a flurry of activity - mostly meant to reassure the ecosystem about their commitment to the platform, I think. After Java 8, new additions like lambdas seemed to have somewhat rebooted the scene. The ecosystem looks more lively now than 10 years ago, in many ways. It’s definitely a better language to work with, it feels rather less “enterprise” than before.

The move to monetize the JDK is annoying but almost understandable as a compromise between the renewed push to evolve the JDK (with yearly releases) and Oracle’s inclination to spend as little as possible on support. They don’t care if some of that support activity ends up generating money for others (via alternative JDKs), they just don’t want to be on the hook for it.

I’m hardly a fan of Oracle (the cloud move is such a fraud), but to be honest I think their Java strategy does make sense. It certainly makes more sense than Sun’s.


>Even Java started to lose momentum after Oracle acquired it.

I sometimes wonder how much would it take to buy back Java from Oracle. Basically to buy back the Trademark, TCK and the official stewardship. ( Although I have to admit they are doing a pretty good job so far with Java )


I wish this would be done at some point. So Java could be popular again somehow...

Problem is Java is open source , and companies like Google , Amazon , Redhat have their own JVM implementations... So it’s not so much an issue.

In fact it’s the opposite , having to acquire something as big as Java comes with huge responsabilities to maintain it and make it evolve.

Hence these days , Rust and Golang really got popular , it wouldn’t make sense for anyone to buy back Java...


Android's java ius not a real java implementation.

Use kotlin instead!


Seems to me that there's three stages to a company's life:

Great to invest in, great to work for: Microsoft/Google in the early days

Great to invest in, not great to work for: AT&T today

Not great to invest in, not great to work for: Oracle today

There's probably companies out there that are not great to invest in and great to work for, but I don't know how common it is for them to become great companies to invest in.


Interesting taxonomy. To the extent this maps to the growth potential of a company, I think the definition of "great to work for" is relevant.

Joy Covey, Amazon's first CFO, left in 2000 (I believe) and when asked later why she left she said something about the work place being too chaotic and fast paced. She attributed the majority of this work dynamic to Amazon being an internet business.

My point is just that some companies (e.g. Amazon) have work cultures typically understood as less appealing than companies (e.g. Google) with similar growth profiles and thus similar investment value profiles.

----

Covey, of course, walked out with $200M+ in Amazon stock. So, work culture could be sub par while the company is still "great to work for."


Not great to invest in, but great to work for: early-stage startups with fancy work environments but no real chance of success.


Those usually end up being companies that aren't great to work for because of how dysfunctional most of them are. Fancy work environments don't make me happy, but clueless management sure makes me unhappy.


This is wise. Choose a company to work for the same way you choose a company to invest in.


He has no idea about technology. He didn't invest in Google and Amazon and he bought Apple at the absolute top. He also bought IBM and sold at a loss. He is equally mistaken with Bitcoin. It's just not his field and his moves mean nothing.


He's honest enough to admit as much. From the article:

"after I started buying [Oracle], I felt I still didn't understand the business. I actually changed my mind in terms of understanding it, not in terms of evaluating it. Oracle is a great business, but I don't think I understand exactly where the cloud is going."


at the same time he is extremely convinced that something he doesn't understand (Bitcoin) is going to fail but he doesn't short it either. He is just old.


Missing on investments you don’t understand is not strike against Buffett, that’s just good investing. A good investor is going to own only a few shocks at a time. What you buy is far more important than what you miss.

He’s up about 50% on his Apple investment.

IBM is probably Buffetts biggest mistake of the last decade or so, and he made money on it. He bought shares at $173, sold them for between $150 and $170, but also made close to $30 a share in dividends.


> he bought Apple at the absolute top

He started buying Apple in 2016 at a little over $100 per share. He’s done well with that investment.


Long bitcoin in 2019? Brave.


He’s wrong about Bitcoin? Not a lot of evidence to support that theory at the moment.


Buffet and Munger have been ragging on bitcoin since it was less than $100.

https://bitcointalk.org/index.php?topic=198578.msg2065800#ms...


Cost basis for Apple is in the $140s. Absolute top is $220+.


I agree in general with your sentiment. He not only missed those, but he comes off as ignorant versus unlucky regarding technology. His first Apple purchase price was around $90 so it was far from the top. Apple is more about consumer and brand though so I think it better fits his skill set than an enterprise software company. He did buy Verisign at $90 though too, which seems to have a pretty impressive regulated moat.


Regarding VRSN, keep in mind the distinction that not all of these buys are Warren Buffett.

For example one of Buffett's investment chiefs made that AAPL purchase in the first quarter of 2016, either Ted Weschler or Todd Combs. They bought ten million shares initially.


Whether or not they mean anything theyre signals and market making moves.


Thats a good think. Theres no issues getting out


I used to be an oracle consultant, it paid really well. Now it doesn't, and their are less jobs in it. Unless I'm getting paid a lot I wouldn't use Oracle, I'd do something more interesting. Around the 2000's the number of Oracle DBA's skyrocketed, they come from India and elsewhere, so companies outsourced the Oracle work to these companies, and I believe Oracle itself is developed in large part in these countries.

So the work for Oracle dried up, and wages plummeted, so I moved out of Oracle, like many others. DBA work is fairly easy to outsource, at least on paper, same with Dev work. Maybe their now paying the price of all this outsourcing to a less skilled workforce (at least initially).

I no longer do Oracle work, it was a nice money spinner, now its a race to the bottom. Conversely their licensing practices are extreme, as others have mentioned, so everyone wants to get out of Oracle.

Having said that, their databases are still very good, and can do anything you want without going elsewhere. Though they are being disrupted from below with many open source solutions and MSSql.


Hmmh, Oracle runs expensive front page Wall Street Journal Ads that say "Cut Your Amazon Bill in Half".

I wonder how effective these are. I've been seeing them since at least 2015 so they must be somewhat effective.

Here is what they look like (the banner on the right):

https://www.oracle.com/database/autonomous-database/guarante...

Oracle's stock is at a 5 year high!

https://www.google.com/search?source=hp&ei=WOh6XJXUMIeQ0gL0j...


Oracle has always relied on bold ads with bold claims. Example:

https://regmedia.co.uk/2012/11/15/88_byte_oracle_large.jpg


"Buffett explained that this employee "works with a limited amount of money – $13 billion, roughly – so if he wants to buy something he needs to sell something. If I want to buy something, I have cash around to do it.""


Aah.. Oracle! The company that, when researchers benchmarked it against other DBs and found it dead slow, they made benchmarking it illegal. Why are they still around again ?


There's also speculation that Buffet was trying to buy Southwest Airlines: http://amp.timeinc.net/fortune/2019/02/28/southwest-stock-ac...


Southwest also got FAA approval to start flights to Hawaii this week which is a more likely reason why their stock jumped.


Interesting, I did not his view on airlines had changed, thanks for the link.

Previously: https://www.forbes.com/sites/tedreed/2013/05/13/buffett-decr...


It did once he realized airlines are now offering additive items. When it was just a butt in a seat, airlines were crap businesses due to the capital costs, regulations, and fuel prices. With shale, it looks like the US won't have a foreign oil dependency for a long time. Meanwhile, airlines can charge you $12 for wifi, $30 for extra legroom, etc. which completely changes the economics of flying.


Notably, Southwest doesn't currently charge for checked bags, which is probably the biggest piece of secondary revenue for other airlines.

I doubt WiFi makes money for any airline. It's either satellite, which costs them a ton, or LTE, where they get a paltry revenue share. I think WiFi is more of a customer satisfaction/expectation thing.


Eh, most airlines going for satellite WiFi aren't doing it out of the goodness of their hearts - they're doing it because the unit economics make sense. There are exceptions like JetBlue who offer it for "free" though.


If you do the math on the high capital costs to install and FAA certify the satellite equipment, then the ongoing transponder costs, then the low conversion rate, and finally the fuel costs due to the protruding bubble for the antenna...they are lucky if it breaks even.


I think they do it because customers have shown a willingness to choose flights based on which has wifi (and they now show up in aggregators like Kayak and Hipmunk). Previously, price and schedule were basically the only differentiators that actually affected peoples' purchasing decisions. When it means selling a ticket vs. not selling a ticket, it's much easier to make the case for the capital costs.


They seriously need to figure out how to fold WiFi in as an option in the ticketing process. It's annoying to have to fumble around with a credit card on the plane, typing in my address and billing information (which they obviously already have).

Make it easy to purchase WiFi access and just about everyone will click that box. Once on the plane, just have the customer scan their boarding pass or something to enable the service. Laptop users could be accommodated by entering the usual 6-character confirmation code that they already use for everything else.


Southwest was able to offer such a service because of their long term contracts on oil.


Southwest has been getting crushed on their fuel hedges for almost the last decade. That’s certainly not why.


With Oracle essentially comiting suicide with the new Java licensing scheme this isn’t surprising.

It’s the best thing that happened to OpenJDK and the much cheaper commercial alternatives based on it.

I can only imagine the celebration at Azul when Oracle announced this nonsense they basically justified the business model of their competitors overnight.


You are very confused (I work at Oracle on OpenJDK):

- OpenJDK is the name of the JDK developed mostly by Oracle, with contributions from other companies and developers[1] (see the logo at the bottom of the OpenJDK website http://openjdk.java.net/)

- For many years, the JDK offered by Oracle (and Sun before it) was OpenJDK + commercial/free but proprietary features.

- Recently, Oracle has made a big move: they've completed open sourcing the JDK, and opened all of the commercial/proprietary features (those that have not been discontinued)[2]

- To fund Java's development (unlike in the case of .NET, iOS or Android, Sun/Oracle have not controlled their platform's billions-making ecosystem) there have been many monetization schemes over the years: licensing Java for mobile/embedded (the JDK used to have field-of-use restrictions), charging for the commercial features in the mixed free/commercial JDK, and even annoying browser toolbars. All of those are gone now that Oracle has open sourced the entire JDK.

- To keep Java competitive and attractive, and under encouragement from the community, Oracle has changed OpenJDK's release cycle to time-based releases, employing "Chrome versioning." There are no longer any major releases (every 3-5 years), and instead, more gradual, small "feature releases" every six months.

- The current monetization mechanism used to fund OpenJDK is a paid subscription model for what's known as Oracle JDK, which is essentially OpenJDK but offers customers the option to have even smaller updates than the new feature releases, that include just security patches and bug fixes, for companies that don't want new Java features. So Oracle offers the same software -- with no hidden commercial features -- under two different licenses.

[1]: https://blogs.oracle.com/java-platform-group/building-jdk-11...

[2]: https://blogs.oracle.com/java-platform-group/oracle-jdk-rele...


What is the new licensing and how is it committing suicide?

Last I checked everybody uses java for everything, especially Google, which then makes it ubiquitous (on Android devices, etc.)


This isn’t about Java as a language but about the Runtime binaries provided by Oracle.

There is now a very aggressive fee structure for using Java SE/JDK in a commercial environment.

https://www.oracle.com/technetwork/java/javaseproducts/overv...

You will pay as much as $2.50 per user for desktop installations and as much as $25 per core for server installations, the Advanced subscription which also provides you with security updates for older versions of Java is now nearly $7000 per server per year.


Nah, you won’t. For new deployments, you’ll use OpenJDK. For old deployments, you’ll either upgrade your codebase or use an alternative runtime (Amazon, IBM etc). Most of them will be free or cheaper than Oracle’s.


In the past companies had no clue how much of something was installed. These days with cyber security being such a concern any company with tight controls knows exactly what's on every machine. It's not hard to treat Oracle Java like a threat and red flag it during scanning. And if Oracle keeps up these shenanigans I can't help but feel like that's exactly what will happen.


Eh? The entire financial sector runs on Java, this isn’t about milking fees form some random companies because someone installed Java on their laptop this is milking fees form the actual key users of Java.

Microsoft has signed an agreement with Azul for Java on Azure and Amazon has released their own distribution of OpenJDK as a result.

The company I work for also switched to Azul since the projected cost of Oracle was in the 10s of millions due to their Advanced support costs per server.

Just to put things into perspective the projected yearly licensing cost for a single trading platform for us was 21 million dollars for the Oracle Advanced service agreement, I don’t know the exact final figure but apparently Azul was less than 200K for the entire company.

I simply don’t understand how Oracle thought they could get away with these fees.


> The entire financial sector runs on Java

No, it doesn't. Sure, you'll find a good amount of Java, but it will likely be C++ anywhere that's really latency sensitive. C# is also heavily used for front end GUIs now. F# is growing as well, and the quants (and others) love Python.

In my experience in finance, Java is now legacy. It was a fun experiment and had a good go, but it's now withering away.

Source: 15 years in financial development, mostly hedge funds, across 4 firms, and having interviewed with dozens of others.

Only place I've worked at doing active Java development was a startup CRM SaaS targeting the financial space. Coincidentally, the only Oracle shop ive worked at.


I think you are talking about a small sector of finance (trading, especially HFT?). The lion's share of software in finance is software used by large banks, insurance companies, etc. -- not hedge funds -- where Java is dominant (even in new projects).


Right but they don't have to run Oracle Java. I didn't say red flag any Java, I said red flag Oracle Java. So in the end I think we agree?


I think any amount of fees would trigger movement away from Oracle, and suspect they calculated they were better off going all in to extract the maximum possible value before people switched away.


My company (big bank) is leaving oracle's jvm. Because of the new licensing. They are not the only ones.


I don’t think Oracle minds, as long as you pick another JVM rather than moving to a different stack.

What they do mind is that Java stays relevant without costing them a lot of money. By basically offloading support of old versions to others (and/or by getting paid more for that support activity) while they accelerate development speed, they will likely achieve that result.

The alternative is to keep sinking a lot of money in development and marketing efforts, like Sun did; which, in the long term, resulted in slow release cycles and language stagnation, making other stacks more appealing.


Isn't Android transitioning to kotlin ?


This is the runtime binary. Android has always ran Dalvik, which is an alternative runtime implementation that uses some of the same class library interfaces.


I thought he didn’t invest in tech because it was outside his “circle of competence”?


If memory serves me well, in one of the letters he sent a number of years back (10-ish?), he mentioned that they had someone in their staff managing a portfolio of stock picks and doing a great job at it, and gave a heads up to readers that they might find tech stocks come in and out of their portfolio every so often as a result. Presumably he liked the returns he was seeing and jumped in too.

Also, Apple displays a number of characteristics that he reportedly likes to invest in: the business that Apple is in is straightforward to understand, the market is big and they've a strong or growing market position, they're profitable and have a big cash position, they've a strong brand and difficult to reproduce expertise (i.e. a moat).


Yes, this always struck me as strange and at the time my naive thought was that Apple was overvalued.

https://www.youtube.com/watch?v=lTd7Iax-I60

What he says around 00:27 about Snickers applies very much to Apple as a brand. This is the only Buffet-ish explanation of why Berkshire would invest in Apple that I could think of.

And apart from this, the decision to buy a lot of Apple stock a while back was made by other asset managers, not Warren himself, and I'm sure was the result of thorough analysis, not based on some offhand comment in an interview.


A couple of possible points on that. Buffett is always learning and maybe he feel's he understands Apple enough now.

Also to quote Buffett "If you look at Apple, I think it earns almost twice as much as the second most profitable company in the United States". Which I guess attracts him - he's always been into consistent profits on modest capital which Apple is good at.


He also said somewhere that a person's "circle of competence" can grow as you learn.

That being said, lot of Berkshire's bets are now coming from Berkshire's next generation of managers - Ajit Jain, Greg Abel, Todd Combs and Ted Welscher. It is speculated that the decision to buy Oracle has come from either Todd Combs or Ted Welscher.

Todd Combs is also said to be driving Berkshire's investment into Paytm, an Indian e-wallet company which again is a technology company.


He says he sold off Oracle for precisely that reason.


2015 called


Oracle is going down in flames for sure. Their cloud is an absolute joke. Disaster levels of bad.

It was one of my favorite jobs though, basically a paid vacation. Thanks Larry!


Can someone please ELI5 what is Oracle software? I thought it's a Java, but this thread mentions data bases. Is it something like MySQL? Do customers pay a lot for this database software or for the hosting/cloud?


Today there are two major proprietary databases: Oracle and MS SQL. There was DB2, but I'm not sure if it's still relevant. And database market is huge, basically any serious enterprise software uses Oracle.


I bet DB2/UDB is still around and kicking, if nothing more for legacy support. Theres also Sybase, but they've fairly much stagnated and jacked up their pricing, so the companies I've worked with that used Sybase either have or are working to migrate to MS SQL.

There are other esoteric DBMS's, such as IMS which is still supported by IBM to the best of my knowledge (because that 40 year COBOL app still has to run).


There is also SAP HANA, so make that three.

Disclosure: I work at SAP (in internal infrastructure though, so I'm not working with HANA).


It’s a public company that primarily makes database systems, but also other software systems with a focus on large enterprise clients. It’s all very expensive. Some of it is now cloud-based.

And yes, Oracle does own Java, too.


also Oracle owns MySQL


It's awesome news that in a story on Oracle, this is a question that someone had to ask.

That is, awesome for the industry. Not so much for Oracle.


Watching Warren learning to buy tech stocks is like watching a 4 year old learning to ride a bike. I suspect the problem is that for tech stocks the future is much less certain than in most industries and the trick is to judge before hand how things are likely to play out for a given stock given the various threads of likely technical progress over 2, 5 and 10 years.


Is there actually some sort of a Warren Buffett deal tracker? Just some simple side/list of trades he is doing. Or what is the delay he is usually publishing them?


13F's have Berkshire Hathaway's positions 45 days after the end of a quarter.

https://www.sec.gov/cgi-bin/browse-edgar?CIK=0001067983&acti...


I was going to joke that the Red Hat investment could mean that 2019 is the Year of Linux in the Portfolio, but that year was, arguably, 1999, when LNUX when public.


Buffett doesn't know where the cloud is going? That admission just shows that Buffett still seeks to understand the boundaries of his competency. Classic Buffett.

Also, I like that he's buying Red Hat. (He won't hold it long, though. IBM is getting closer.)


His explanation made so much sense. He said he didn't understand the product lol. That probably a sign to get out


What would have made sense is for him not to get in to the company in the first place, if he didn't understand the product.


Certainty is only found looking backwards.


Smart man. Oracle is garbage.


i don't get this. their machines are too costly. the old insane greatness has become watered down with a focus on global logistics. and what about the supply chain issues with China?

what does Apple have on the horizon -- data services? an emphasis on the privacy protecting ecosystem?

where is the new vision?


Well, they make machines that are very costly and they focus on global logistics. They've also got a huge supply chain in China. You don't need a 'new vision' to make bucketloads of cash for your investors.


Apple doesnt make phones or computers that are much more costly (from a hardware perspective) than any other brand. What they have is higher margins per unit due to branding and brand loyalty.


No they have higher margins due to custom hardware and software added value.


At this point it's not crazy to think of people holding AAPL equally for the dividend as for expected future share price growth. It paid out dividend at 1.67% of the share price last year. That's $700+ million in dividend for Mr. Buffett, not too shabby.


At their PE ratio they don't need to have a bright shiny future of limitless growth. They just need to not be Nokia.

AMZN on the other hand ...


I don't see Apple achieving hyper-growth and becoming a $10 trillion company, but they have a solid business selling high-end hardware to people willing to pay for it with money instead of data. What does Oracle have on the horizon? Legacy enterprise support and lawsuits about Java?


If Apple strengthens their foothold in Health and Health related services/integrations, their marketcap will multiply from where it is now.


I honestly can't see Apple making this work.

Health is a diverse, messy, market. Apple's schtick has always been making devices that make computing magical, and health would be a huge shift away from that.

IMO the market is really looking for a a powerful all-in-one diagnostic health appliance - something like the analyser Theranos was pitching for, but which actually works, and is more comprehensive.

De-industrialising health and making the personal equivalent of a diagnostic lab that could keep track of key markers, watch nutrition, exercise, and supplements, and transfer information to doctors - AI or human - would be a major breakthrough.

But the technology for that doesn't exist yet. And even it becomes available it may not be affordable or portable.

And because bodily fluids are involved it conflicts with the Apple image of clean minimalism.

That leaves health as set of tentative fragmented tools and services which provide reassurance here and there - like the fall notification in Watch - but are a long way short of a comprehensive service.

The fitness market is a more obvious choice. But if you look at Apple's record, it's not inspiring. Fitbit is a strong competitor, because Watch hasn't lived up to its potential - possibly because Apple can't decide if Watch should be a fashion statement or a personal fitness device. It doesn't really make sense to consumers to try to sell it as both.

Behind all of that, I just can't see the current management team having the skill or imagination to make it happen. I think health is going to remain a side interest - a nice add-on, but not a huge new core market that Apple can expand into.


> What does Oracle have on the horizon?

They could become a good force in the cloud after netsuite purchase.

https://cloud.oracle.com/home


They could keep trying, I suppose. FWIW they've been in the cloud business since the 2000s. They and IBM were some of the few who were in that business early, and even then their respective reputations preceded them. (This was before XEN, widespread adoption of virtualization, and a slew of other DC techs that democratized using the cloud.) I would imagine they both got enough fortune-whatever companies onboard to earn good money, but neither are market leaders today. Just spitballing, but I'd assume their cloud customers are all companies who buy other stuff from them.


Exactly. With the hostile takeover of PeopleSoft, Oracle bought themselves a number of huge customers who are disinclined to change ERP systems on anything other than decade-long timelines. It has evolved and is now cloud...ish, so they can certainly talk themselves into being perceived as a “leader.” (Even though they’re not really cloud-native in the way that Workday, Salesforce, or others are.)


Apple has a lot of potential to expand into health care tech and digital therapeutics, which is a huge, growing market. They have a great brand, expertise in making consumer hardware and software, and they're one of the few large tech companies that's able to take privacy seriously.


You mean consumer health care tech? From what I can see that is all about marketing and has very little to do with science. I see it more as a fad.


Americans are getting older. Apple released a new Apple Watch with fall detection and it was 100% of the reason 3 of my coworkers purchased one for aging parents.

Health is a privacy sensitive industry and Apple is the only company that has been selling privacy as a core feature.

This is squarely within Apple’s target and they will bet big on it.


ResearchKit at Apple isn’t about “marketing,” but science. Apple led one of the largest cardiology studies ever with Stanford. Their health records stuff is far beyond “fad” or “marketing.” Apple gets accused of being simply a marketing company — that’s absurd, just look at Apple Watch: that’s quite serious tech and no other consumer products company comes close to what the watch is doing. Apple has more doctors on the payroll than many “serious” health companies.


No way. There’s a huge market for medical monitoring that is dominated by big dumb players.

Your insurance pays like $3k to wear a heart monitor for a day or two.


The problem with that huge market is not that it's somehow hard to make monitoring devices, but it's hard to get them through the bureaucratic process of being legal to use for medical purposes. Doing that is quite an orthogonal skillset to engineering.


A company with billions in cash can learn quickly.


Don't they still have a bunch of unused potential in activity tracking?


They print money and own many segments of smartphone that really matter. They can cruise for a decade doing nothing.


I don't think you can ever say that about any consumer electronics company. All of them are always one replacement cycle away from potential disaster.

Apple has enormous margins to defend. If they cruise for a decade their margins will approach the average margins of the industry because people will no longer pay extra for the brand.


Outside of China they're not paying for the brand. They're paying for the iOS eco system and that's still a valuable moat. It remains to be seen if a super app such as WeChat will emerge in other markets but until/unless it does Apple have a pretty strong moat.


I don't believe that this huge difference in margins is purely down to pragmatic considerations anywhere in the world.


Perhaps the same can be said about Louis Vuitton handbags, and does not stop MHLV, or whatstheirletters, from making money hand over fist.


When you say the machines are too costly, who are you implying that's bad for? Presumably not investors?


it's bad if a company wants to expand its customer base while potential new customers are instead buying cheaper products from competitors


It's also bad if you drop your ASP to the point it hits profits though.

Healthcare services using the watch. I was a doubter but the fitness rings schtick combined with a weight lifting app has me sold on it. Streaming content? The consolidated news app is interesting as well, but probably not a huge revenue stream.


It will be interesting to see more and more insurance companies offering discounted/free Apple Watches. Fitness + accurate monitoring of heart activity + whatever's coming next makes for a powerful combination.


It’s pretty common in the U.K. where health insurance packages offer Apple Watch / Fitness trackers and gym memberships for them it’s a no brainer if even 1 out of 50 insurers would alter their lifestyle it would more than pay for itself.


TL;DR - Apple is extremely healthy, with many rooms for growth or sustain its current profits / revenue.

1. Still Growing number of iPhone users, 900M as of the end of 2018. I made a prediction in 2015 / 2016 that Apple could reach the unthinkable ( At the time ) 1B iPhone user by 2020, looks like they are well on course to do that. There will be roughly ~3.5B Smartphone users world wide in 2020. Even if Apple does't grow its user base anymore. Selling to its 1B Customer, which are also the higher spending group, would still be a lucrative business that not many other company could match.

2. Health - When it comes to Health, people don't want to spend money on a brand that that cant trust. So even if company X has an exact replica of Apple Watch with exact software and function, people would still trust Apple and spend 50% or more on it. Also worth mentioning the group of people who cares about health are also likely the one who are passed mid life and has higher deposable income. And health insurance company loves these Data. I am actually surprised at how affordable Apple priced the Apple Watch S4, they could have jack up the price in US purely on the ECG function. ( I have heard many stories about parents want to buy the Apple Watch *immediately8 after reading or watching the Apple Keynote, I am also surpassed how many non-tech people actually do watch the keynote live )

3. Services - It is a growing segment but honestly, even if Apple Attract 100M Apple Music + Apple TV Subs at $20 combined, that is only $6B per quarter, roughly 10 - 15% increase of their current revenue. It is not a huge percentage, but it is hard for Apple to grow when it is so big. I think the future is Apple offering 24+ Months of Financing ( leaving the 24 months for Carrier ) , like 36 / 48 months for iPhone, charged to their Apple Credit Card, Operated and Backed by Goldman Sachs. Bundles along with other high margin product like AppleCare+. This could potentially be the next revenue and profits growth.

4. The Mac and iPad still have yet to show their full potential. There is no reason why Apple could not gain a 200M+ Mac User base. And iPad / iPad Pro still needs to battle out the Education and Pro Segment.


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