Oracle continued to hammer home its message on the value of cloud at its CloudWorld event for customers and partners at the Waldorf Astoria in New York City.
Cloud is critical to IT because of a confluence of trends, said Mark Hurd, Oracle CEO, in his keynote at the event, repeating a warning he has issued at past Oracle events.
Oracle’s Mark Hurd: Why Support for Cloud is Gaining
Revenue growth is stalled across the economy although earnings continue to grow through cost cutting. Worldwide IT spending has decelerated over the last 5 years, and there is an estimated 5.1% spending decline in 2015 alone, he noted. Observing that most CEOs last an average of 4 years on the job, he said they feel the pressure to drive earnings in a short time-frame. “What CEOs care about is business agility and entering new markets, financial growth, and survival,” he said. The combination of these factors form the backdrop for IT investments.
Along with the imperative to increase earnings, there is also a demographic shift taking place. Fifty percent of the workforce will be Millennials in 2020. Sixty-eight percent of Millennials demand an integrated seamless experience regardless of channel and 90% say access to real time product availability information would influence their shopping choices. And, they expect easy to use mobile apps that just work.
Infrastructure is old, and old apps are running on that old infrastructure, resulting in 80% of IT budgets being spent on maintenance, leaving just 20% available for modernization and innovation. And, that 20% is increasingly squeezed by the burden of adding security to protect the aging infrastructure that houses precious company data. In short, the current on-premise IT operating model is unsustainable, said Hurd.
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SOURCE: DBTA
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