Rivals Microsoft, Oracle expand their cloud partnership

Customer previews of the new service, called Oracle Database@Azure, will be available in early 2024 in regions of the U.S., U.K. and Germany. Oracle and Microsoft declined to disclose financial details of the plan.

“We have a real opportunity to help organizations bring their mission-critical applications to the cloud so they can transform every part of their business with this next generation of AI,” Microsoft Chief Executive Satya Nadella said in a statement. Microsoft Azure will be the only other cloud provider to run Oracle’s database services, he said.

“Most customers already use multiple clouds,” Oracle co-founder and Chief Technology Officer Larry Ellison said in a statement. Seamlessly connecting Oracle’s database technology with Azure Services will let “customers experience the best possible database and network performance,” Ellison said.

Ellison and Nadella made the announcement at Microsoft’s Redmond, Wash., headquarters.

The deal marks a significant strategic shift in the cloud market. Before, cloud providers attempted to lock users on one platform. But that isn’t feasible as the cloud has become more central to operations, and customers now usually use multiple cloud offerings, according to tech analysts.

“Collocating the Oracle database offering within the Microsoft Azure Cloud really gives customers the best of both worlds — Oracle database services running side-by-side with Azure services,” Gartner analyst Ed Anderson said in an email message. “We expect this will ease the challenges of implementing Azure cloud applications that leverage Oracle Cloud database services.”

Shares of Microsoft and Oracle were flat in after-hours trading Thursday.