Cloud Database Battle: AWS vs. DIY vs. Oracle: By, David Floyer
Cloud Database Battle: AWS vs. DIY vs. Oracle: By, David Floyer
Oracle
The first premise of this research is that architecting the Oracle Cloud Database service to run on specialized
hardware and software, either on-premises or in Oracle Cloud Infrastructure (OCI), allows the cloud database
vendor to reduce costs significantly. This approach also allows the vendor to provide autonomous services based
on economies of scale that further reduce the operational support costs. The combination of the two methods
leads to halving the cost of running today’s cloud database application suites.
The second premise is that future synchronous automation of business processes will require real-time
integration between systems-of-record, advanced analytic/AI inference systems, and other data and cloud
database types. This integration can only be achieved by sharing data between database types. Also, the
operation of synchronous applications is too complex for traditional operational processes. Therefore, high levels
of cloud database and application automation, and machine learning are imperatives for synchronous application
deployment.
Oracle Cloud Database is Tier-1 and in a class of its own. Wikibon recommends that larger enterprises with
mission-critical workloads should not convert from Oracle to other databases. Instead, Wikibon recommends
migrating to Autonomous Cloud Database on Oracle Exadata Cloud@Customer X8M, Oracle Exadata Cloud
Service on OCI, or other Oracle Database cloud services. Wikibon recommends that enterprises minimize the
number of separate databases and data types and use the converged Oracle Cloud Database instead.
At this time, Wikibon cannot recommend running large-scale Oracle Database mission-critical workloads and the
surrounding portfolio of applications on AWS. The cost of running Oracle databases in AWS is prohibitive.
Wikibon recommends Microsoft as the best multi-cloud alternative for Oracle mission-critical workloads because
of its adjacent Microsoft Azure strategy combined with Oracle Exadata Cloud technology.
Senior executives should press Oracle and AWS to bury the hatchet and develop a win-win-win cost-effective
multi-cloud database services strategy for their joint customers.
The second premise is that future synchronous* automation of business processes will require real-time
integration between systems-of-record, advanced analytic/AI inference systems, and other data and cloud
database types. This integration can only be achieved by sharing data between database types. Also, the
operation of synchronous applications is too complex for traditional operational processes. Therefore, high
cloud database and application automation and machine learning are imperatives for synchronous
application deployment.
* For a more in-depth discussion, see the “Application Support for Synchronous & Asynchronous Business
Processes” section in the Footnote at the end of this research.
Executive Summary
Cloud Database for Existing Systems
A cloud database resides on a private cloud, public cloud, hybrid cloud, and multi-cloud environments.
From an application perspective, the database services are identical. The only difference lies in where the
database resides. There is an option for databases to be fully managed from a public cloud as an
Autonomous Cloud Database from an operational perspective.
This Wikibon research focuses on the IT Operational costs for running large mission-critical applications on
Oracle Cloud Database Enterprise Edition in an on-premises cloud environment. It compares the operational
IT budget costs for a traditional IT datacenter with a multi-vendor Do-It-Yourself (DIY) infrastructure, AWS
running Oracle RDS on Outposts**, and Oracle Autonomous Database running on Oracle Exadata
Cloud@Customer X8M.
Figure 1 shows the results of this research. The y-axis shows the four-year infrastructure, operational
support, Oracle Database licensing, and additional datacenter costs. The blue column shows 4-year costs of
$40.1 million for running mission-critical applications in a traditional on-premises datacenter with a
traditional on-premises Oracle database. The orange column shows a slightly lower figure of $38.7 million
for running Oracle as a cloud database in the RDS service on AWS. The third column in red shows a much
lower figure of $20.4 million, which is the costs of running the Oracle cloud database on-premises on
Exadata Cloud@Customer X8M.
The conclusion from Figure 1 shows that compared to Oracle Autonomous Cloud Database on Exadata
Cloud@Customer X8M, the cost of running the same large mission-critical Oracle-based applications in a
Traditional IT datacenter is 96% higher and on AWS RDS on Outposts is 90% higher.
Most large enterprises run their mission-critical systems on Oracle databases. The business conclusions are
that there is no business case for migrating large mission-critical Oracle applications running on traditional
on-premises (“DIY”) environments to an AWS Oracle RDS cloud database. There is a strong business case
for enterprise IT management to migrate Oracle Database large mission-critical applications, running on
either a “DIY” or on AWS Oracle RDS environments, to an Oracle Autonomous Cloud database running on
Exadata X8M.
The “Autonomous Database on Exadata Cloud@Customer X8M Architecture” section below gives a more
detailed break-out of costings and all the assumptions.
Multiple database types are increasingly required to process this enormous amount of data. There are
transactional databases for systems-of-record, advanced analytic and graph databases for analysis
systems, AI databases for inference, document databases, time-series databases, blockchain databases,
and many more.
The traditional approach of using separate “best-of-breed” database types for each application means
complex data transfers and transformations are required between databases. Wikibon concludes that this
architecture will make future synchronous applications needing to blend different data types from various
database types much more expensive and challenging to implement, if not impossible. Synchronous
applications require that the databases share the same data in real-time because it simply takes too long
to move data from one database to another.
Summary of Conclusions
This analysis means that deploying a single autonomous converged or universal database that supports
different data and database types is the correct long-term strategy for most large organizations. These
database architecture benefits are much greater than the operational savings examined in this study, and
Wikibon plans to address this in future studies.
At the moment, Wikibon assesses that Oracle is the leading provider of a converged database, and Oracle
has clearly stated it intends to continue investing in ensuring performance, automation, and integration of
different databases and data types within the Oracle Database.
Wikibon recommends that IT executives deploy their Oracle mission-critical workloads on Oracle
Autonomous Database on Exadata Cloud@Customer X8M to reduce costs today and prepare for the
synchronous applications soon.
increase the percentage of synchronous business processes is the most effective way to improve employee
and partner productivity, improve customer satisfaction, reduce the cost of doing business, and reduce
business cycle time.
Data-driven enterprises can accelerate productivity from synchronous automation by marrying OLTP
systems of record and other real-time analytic/AI database systems. However, the systems architecture
and services must integrate and optimize the different components to allow organizations to meet real-time
response-time requirements. There is a significant simplification of the architecture when a single database
can share separate databases and data types.
Traditionally the analytic systems were batch systems, and the technology was not available to run
analytics systems in real-time. However, infrastructure technology has improved dramatically to process far
more significant amounts of data in real-time. Also, many additional data and database types have been
created, which can operate much more efficiently to different analytics and support business requirements
in real-time. These databases often start as standalone databases to solve specific problems. The
successful ones (like MongoDB for document handling) create their own ecosystem.
Moving data from one database system for use in another requires data transformation and data transfer,
both of which can take significant elapsed time. The more databases and data types that exist, the more
specialized transfer systems are required. Sixteen databases would require 120 different
transformation/transport systems. Fifty databases would require 1,225. This approach is not sustainable
because it leads to data fragmentation, data inconsistency, security holes, and massive data management
costs. Also, it does not scale and is not a suitable platform for creating synchronous solutions.
The ideal architecture implements an autonomous unified or universal cloud database, with all the data
directly available to all applications. This architecture makes possible far richer application systems. For
example, a system of record can ask for real-time analytics to help automate a business process. This
analytics process requires shared databases running on a high-performance, purpose-built, and optimized
stack. The cloud database and data types need to include relational operational, advanced analytic, AI
learning and inference, document, graph, key-value, in-memory, blockchain, etc. Wikibon expects new
databases and data types to evolve.
This approach provides a high-performance and flexible cloud database system for synchronous application
systems. It eliminates the data transfer and transformation processes necessary to move data across
multiple specialized databases. It also avoids data fragmentation and data consistency issues, enhances
security, and reduces data management costs.
Oracle has designed an Autonomous Cloud Database architecture to automate the management of the
most mission-critical workloads, including provisioning, tuning, clustering, disaster protection, elastic
scaling, securing, and patching. As a result, many of the traditional manual processes and human errors
are eliminated. This autonomous cloud database solution delivers far lower costs and significantly lower
risk for the most demanding synchronous workloads relative to alternative approaches.
Wikibon believes that this type of database architecture is critical for implementing data transformation
initiatives that most enterprises have embarked on. Gartner has issued a report on Cloud Database Critical
Capabilities, which defines some of the above requirements. Not surprisingly, Oracle Autonomous Database
is the leader in most of the categories.
This should be a wake-up call for AWS, which has taken the approach of offering 16 different mainly open-
source databases and supporting them well in the AWS PaaS and AWS infrastructure. There is support,
including provisioning, tuning, disaster protection, elastic scaling, securing, and patching. AWS has
provided some interconnects between some databases. However, AWS will need to invest far more heavily
in integrating these databases to provide an effective cloud database system for mission-critical
synchronous applications, which have the highest value for enterprises.
Figure 3 below shows the results of the comparison. The y-axis shows the 4-year IT budget costs, including
a detailed breakdown of datacenter infrastructure costs, maintenance and operational costs for the system,
and Oracle software licenses. Figure 3 shows that compared to Oracle Autonomous Database on Exadata
Cloud@Customer X8M ($20.4 million), the cost of running the same large mission-critical Oracle-based
workloads in a traditional IT datacenter (US$40.1 million) is 96% higher and on AWS RDS on Outposts
(US$38.7 million) is 90% higher. In other words, the costs for DIY and RDS on AWS Outposts are nearly 2X
higher than the Oracle solution.
Infrastructure Costs
Server Costs
Traditional IT datacenters need to have the capacity to meet the highest peak-performance
requirements. There is also no offload to the storage or network systems.
The AWS Outposts system offloads some IO, network, and security processing to a lower-cost ARM
Nitro card.
The Oracle solution minimizes IO and system wait times to access data using 100-Gbits/Sec RDMA
over Converged Ethernet directly to the storage server described in the “Oracle Exadata
Cloud@Customer Architecture” section above. Exadata’s Smart Scan technology also offloads SQL
queries, analytics, and ML algorithms to storage servers, further increasing the amount of work that
each database server CPU can process. This architecture reduces the CPU cores required for OLTP
and data warehousing, allowing customers to enable fewer server cores for their given workloads
and reduce Oracle Database license costs.
Traditional on-premises datacenters have the highest cost due to the requirement to meet capacity for
the peaks, usually at month-end, quarter-end, and year-end.
The AWS Outposts and Exadata Cloud@Customer hybrid solutions allow some offloading of resources
to the cloud and reduce on-premises environmental costs.
Oracle’s approach of running the Autonomous Database on Exadata Cloud@Customer also allows
customers to offload resources for data protection and disaster recovery to Oracle Cloud Infrastructure.
In addition, Oracle Exadata Cloud@Customer users can also use local-only backups to meet strict data
sovereignty and security requirements.
Oracle Cloud Database Costs
The database licensing costs are higher for the traditional IT datacenters as, again, the licenses have
to be in place for the peak loads.
The database licensing costs for AWS are much higher due to the lack of agreement between AWS and
Oracle on virtualized cores. This architecture leads to an effective doubling of Oracle Database
licensing costs on AWS RDS.
The Oracle Database costs are much lower for Exadata Cloud@Customer. The much-improved system
speed lowers the system wait times, which reduces the number of cores required and the amount of
time needed to complete a computation, reducing overall costs. As a serverless architecture, the
Oracle solution automatically scales to match changing workloads, providing true pay-per-use. Also,
Exadata Cloud@Customer offers enterprises ways to increase and decrease the number of Oracle
Database licenses they use without interrupting database operations. Running Autonomous Database
on Exadata Cloud@Customer X8M improves this core capability by fully automating the increases,
decreasing the licenses required, and doing so based on the queries currently being run instead of
looking in a rear-view mirror. In doing so, Oracle allows enterprises to optimize performance and cost
controls for their database infrastructure automatically.
Bottom Line: the cost of a traditional IT datacenter is 96% higher, and AWS Oracle RDS hybrid cloud
solutions are 90% higher than Oracle Autonomous Database on Exadata Cloud@Customer X8M.
The advantage of this approach for enterprise customers is in avoiding a lengthy, costly, and risky
conversion of the Oracle Database applications to another database platform. Wikibon has emphasized, on
many occasions, the importance of avoiding database conversions, as this can lead to significant and costly
delays in any digital transformation initiative. Wikibon believes that this Adjacent Database capability was a
substantial reason for the JEDI contract award to Microsoft. The savings from avoiding the conversion costs
from Oracle to AWS databases and the lack of AWS support for Oracle Database systems were significant
factors.
This multi-cloud approach requires enterprise IT to integrate the two services, which can add cost.
However, these costs are low compared with conversion costs.
The costs for running mission-critical Oracle Database workloads in traditional datacenters and RDS on
AWS Outposts are nearly 2X higher than Oracle Autonomous Database on Exadata Cloud@Customer X8M.
Traditional data center architectures have a 96% higher TCO than the Oracle Autonomous Database on
Exadata Cloud@Customer X8M solution evaluated in this study. Wikibon believes it is time to replace the
best-of-breed DIY design approach for Oracle mission-critical infrastructure held together with skillful and
expensive in-house expertise. Giving the design and automation responsibilities to the database vendor
allows economies of scale in developing optimal hardware, software, and autonomous features. This
capability cannot be replicated in-house, even by the largest Oracle shops.
The hybrid AWS Outposts solution shows a 90% higher TCO than Oracle for the workloads analyzed. This
analysis is a Wikibon projection of expected future announcements of RDS on Outposts by AWS and will
be updated, if necessary, after any future AWS announcements.
Wikibon concludes that the current AWS database strategy of specialized, isolated databases with
inadequate data sharing will inhibit the development of synchronous applications and the fundamental
business improvements that can ensure enterprise survival and prosperity.
Microsoft Azure/Oracle Exadata Cloud Adjacent strategy is an alternative way of running Oracle Database
applications in the Microsoft cloud. Although there is some support overhead, the joint approach avoids
database conversion, saves significant time and expense, and lowers business risk.
Wikibon concludes that mission-critical, high-performance Oracle Database applications will benefit from
the specialized hardware and software in Exadata X8M designed to support Autonomous Cloud Database.
The benefits include lower costs, higher performance, availability, and radically improved serviceability,
while Oracle manages an increasing level of infrastructure and database settings.
Wikibon concludes that future complex synchronous workloads will need database technology that allows
sharing of different data types across transactional, analytic, AI, blockchain, and other database types and
automation to meet too tight real-time response times. This converged approach is available now and is a
critical strategic development tenet for future Oracle Autonomous Cloud Database development.
The Wikibon analysis shows that Oracle’s superior cost performance comes from its fully integrated
software stack and hardware specialized for Oracle Databases. The autonomous capabilities are built from
decades of database experience. Wikibon concludes that it is now impossible to replicate these cost
benefits with either a traditional datacenter approach or AWS services.
Wikibon believes that the AWS strategy of multiple independent database types will not allow enterprises
the levels of data integration required to achieve high levels of synchronous business processes. Wikibon
recommends that AWS must invest heavily to develop high-availability versions that are supported as an
integrated product by AWS, and not just provide the piece parts for enterprise IT to assemble, test, and
maintain. Also, Wikibon recommends that AWS invest heavily in developing an integrated database
strategy, with buying Couchbase as a possible first step.
At this time, Wikibon cannot recommend running large-scale Oracle Database mission-critical workloads
and the surrounding portfolio of applications on AWS. The cost of running Oracle databases in AWS is
prohibitive.
Wikibon recommends Microsoft as the best multi-cloud alternative for Oracle mission-critical workloads
because of its adjacent Microsoft Azure strategy combined with Oracle Exadata Cloud technology.
Senior executives should press Oracle and AWS to bury the hatchet and develop a win-win-win cost-
effective multi-cloud database services strategy for their joint customers.
Footnotes
*Application Support for Synchronous & Asynchronous Business Processes
Enterprises use synchronous transactional applications to support parts of their business processes. For
example, ERP systems synchronously update order records, inventory levels, and many other fields.
However, there are many parts of the business processes that are supported asynchronously. For example,
executing price adjustments due to orders (or lack of orders) is usually (Uber & Lyft excepted) not
synchronous. The result is sub-optimal revenue.
One primary IT reason for making the price update process asynchronous is that the analysis to determine
the update requires a large amount of historical and other data, which historically took too long to find and
process. Many enterprises could increase revenue significantly if the price updates were synchronous
instead of asynchronous.
Today’s integrated system architectures can now process both transactional data and analytic data to
determine price-adjustments synchronously, that is, in real-time. In general, making asynchronous business
synchronous can significantly reduce employee costs and improve enterprise responsiveness (i.e., improve
business cycle times).
Technical requirements for the development of synchronous applications include integrated hardware and a
complete software stack, ultra-low latency to data, in-memory databases, multiple databases sharing the
same data, parallel processing of data, advanced machine learning inference functionality, and others.
David Floyer spent more than 20 years at IBM, holding positions in research, sales, marketing, systems analysis and
running IT operations for IBM France. He worked directly with IBM’s largest European customers, including BMW,
Credit Suisse, Deutsche Bank and Lloyd’s Bank. Floyer was a Research Vice President at International Data
Corporation (IDC) and is a recognized expert in IT strategy, economic value justification, systems architecture,
performance, clustering and systems software.
David Floyer
@dfloyer
david.floyer@wikibon.org