This week Oracle announced its plans to acquire domain service provider Dyn. The acquisition follows a turbulent time for Dyn becoming the target of several cyber-security attacks. Dyn represents a great addition to Oracle Cloud and one that differentiates the Oracle stack from market leaders such as AWS, Azure, Google Cloud and IBM Bluemix.
None of of the PaaS leaders in the current market include a domain service that compares with the technical sophistication and market traction of Dyn. AWS Route 53 is certainly a great technical solution but trails Dyn in terms of capabilities and market relevance. The acquisition of Dyn could be part of a broader Oracle strategy focused on bridging the gap with the cloud platform leaders via M&A.
A M&A Path to Cloud Relevance
Oracle’s acquisition of Dyn brings a much needed momentum to Oracle Cloud. Currently, Oracle could be considered a distant fifth in the cloud market trailing Amazon, Microsoft, Google and IBM by a large margin. While the four market leaders are currently trying to out-innovate each other with new platform service capabilities, Oracle Cloud still needs to bridge the gap on the infrastructure as a service(IaaS) space.
One of the few advantages of Oracle in the coud race is its unique talent for enterprise deals and M&A as well as its healthy balance sheet. With two deal makers as Co-CEOS and with Ellison leading the efforts related to Oracle Cloud, the acquisition of Dyn could be the beginning of a M&A spree to gain relevance in the cloud space. If that’s the case, there are a few areas and companies that might help Oracle close the gap with the cloud platform leaders. Let’s explore a few ideas:
Oracle Cloud identity management capabilities are far less sophisticated than similar services in platforms such as AWS , Azure and Bluemix. With a few strong standalone companies in the cloud identity management space, M&A could be a way to stay competitive with the market leaders.
— Potential M&A Targets: Okta, Ping Identity, SailPoint.
Oracle Cloud’s messaging and integration services could also benefit from some fresh IP. PaaS leaders such as Azure and Google Cloud have notably innovated in these areas.
— Potential M&A Targets: PubNub.
Oracle Cloud has started some aggressive IOT initiatives but its current technology stack is very limited compared to platforms such as Watson IOT, Azure IOT Suite or AWS IOT. Currently, the are a few companies in the IOT market that may help Oracle to achieve much needed relevance in the space.
— Potential M&A Targets: Xively, PTC ThingWorx.
Data Science and Machine Learning
Oracle Cloud is already trailing other PaaS in the emerging market of data science and machine learning cloud platforms. Google Cloud, Azure and AWS have built very innovative technologies in the space. The large number of startups in the AI-ML market makes this segment very attractive for M&A
— Potential Targets: Databricks, H2O.ai
Containers is another space in which Oracle cloud can make a splash by acquiring some of the market leaders. AWS, Azure and Google cloud have all recently launched native container services but the market remains pretty open at this point.
— Potential M&A Targets: CoreOS, Docker