Andreessen foretells Oracle's future

Marc Andreessen thinks that the clock is ticking on Oracle and other old-line software and infrastructure companies - Business Insider.

His evidence: not a single one of Andreessen-Horowitz's startup investments use Oracle software. They all use cloud-based alternatives instead.

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"Ten years ago, it was a joke: you'd raise $20 million in venture capital and write a $4 or $5 million check to Oracle, Sun, BEA, and EMC....When it started, Salesforce looked like a toy compared with Siebel. Look ahead five years later, it's obviously better. Not a single one of our startups uses Oracle."

The thing was that Oracle, BEA, EMC - and even Sun - were not appropriate for startups even 10 years ago, and everyone knew it - but you had to "look big fast" in the high hype world of dotcom share price pimping - and every dotcom with attitude was going to be huge in 2 years, of course - so get the Big Boy systems in now rather than buy a decent SME accounts package now and buy Oracle later when you were bigger. Brave indeed was the dotcom startup who went for the appropriate technology, therefore . What Marc also doesn't mention is that many times these large companies would give you the kit on some sort of for-shares or low interest long life loan basis, so you would be financially daft not to take it.

My main issue with Oracle (and the other big players by and large) is that they have done little in the last 10 years to redress that known weakness - and you would have thought Sun's demise would be a lesson. They saw Hosted solutions coming 10 years ago, so this cannot be a surprise - and thus why no action?

The reason is the fairly standard large company issue - addiction to the current business models, and finding it very hard to invest in new technologies that don't "move the needle" and are unreliable by "tried and trusted" standards. In fact, Oracle innovation has typically been "buying the market" as its innovation ploy - either buying out sector competitors, or small companies with interesting products - and then sadly (and probably even unintentionally) slowly strangling them by underinvesting and burying them in corporate treacle.

(This was part of Marc's argument that there Is No Bubble- he believes the cloud computing revolution has made the titanic valuations of major Web 2.0 companies like Facebook and Twitter completely justified - which we just don't buy)

So my prediction is slightly different to Marc's - I would predict that as the Cloud market grows, and becomes more stable, then Oracle, SAP, IBM et al will increasingly just buy their way in. Give it 3 years or so, and Marc's investments will be using Oracle

And as totitanic valuations being justified, we shall see.....