Will Larry Ellison eat his words on cloud computing?

The buzz from analysts and reporters is that Larry Ellison is rethinking Oracle’s cloud computing strategy. Just last year, when asked about cloud computing, Larry said, “Maybe I’m an idiot, but I have no idea what anyone is talking about. What is it? It’s complete gibberish. It’s insane. When is this idiocy going to stop?” If he’s flip-flopping, it’s interesting.  Since Oracle’s one of the titans of Silicon Valley, it’s news.

You know what’s bugging me?  Is Larry really “creeping into the space just nine months after he mocked the business model” as reported in The Wall Street Journal last week? Really? The guy who embodies going against the grain, and stands by his own opinion even if it’s wrong, is backtracking? Say it ain’t so!

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According to The Wall Street Journal, that’s exactly what happened during a call following Oracle’s fourth-quarter results on Tuesday. On the call Ellison said that some portion of revenue from Oracle’s Fusion products could come from subscriptions in the future. This is in stark contrast to the business model that most Oracle customers know — one-time fees for one-off sales. I respect the Journal, but I’m not so sure Larry’s headed back to the future.  I think he just didn’t have an answer ready when asked about cloud computing last year.

Larry’s not as anti-cloud as the press makes him out to be. He has a large stake in NetSuite, a company which he helped found via a significant, personal financial investment. Oracle has also been offering official support on Amazon Web Services for months now. Add that to Oracle’s recent Sun Microsystems acquisition, and Oracle doesn’t strike me as a company that doesn’t understand or isn’t moving into cloud computing. Larry’s comments about cloud computing remind me of the times he bashed virtualization back in the day.  Everyone spread similar rumors then, and the transition from hatin’ to embracin’ looked almost identical.

In other words, Larry didn’t have an informed opinion the first time he was asked about virtualization. Once he did, his story quickly changed from disparaging virtualization to announcing Oracle VM, and eventually acquiring companies like Virtual Iron. So far my sources say the alleged cloud computing reversal is the same situation.

What do you think? Does Larry have a plan?  Did he really have a change of heart, or was he just spouting bull the first time around?