SAN FRANCISCO — Like other corporations, enterprise software giant Oracle (NASDAQ: ORCL) is struggling to make its IT operations more flexible and responsive to business needs while simultaneously coping with ever-increasing demand for physical infrastructure and the pressure to cut costs.
Its solution has been to consolidate and virtualize its infrastructure and install commodity hardware which can be replaced cheaply and easily.
“We face the same challenges as anyone else — an explosion in the amount of data, the growth in power consumption, the lack of skilled people to manage IT to match the growth in compute demand, and the density of computing,” Oracle’s Chief Information Officer, Mark Sunday, said in his keynote speech here at the Next Generation Data Center (NGDC) Wednesday. “Which means we’ll run out of power long before we run out of floor space in our data centers.”
Sunday cited IDC statistics that said storage demand is growing by 60 percent a year. He also cited statistics showing that annual datacenter energy usage in U.S. datacenters grew from 61 billion kilowatt-hours (kWh) in 2006, to 80 billion kWh this year, “which is 1.5 percent of all energy consumed in the U.S.” Datacenter energy demands will exceed 110 billion kWh in 2010, Sunday said.
“We need to do something about our ability to meet the needs of IT or we’ll be crippled in infrastructure,” Sunday added. And, with increasing power consumption, “we’re approaching the airline industry in terms of our impact on environment. Energy has become the second biggest component of cost within our datacenters after labor.”
Oracle’s IT infrastructure is stupendous. Sunday said its internal business systems support 84,000 employees worldwide; it has acquired more than 50 companies over the past four years; it supports about 20,000 developers developing 900 products; it has 32,000 servers, 6 petabytes of storage, a 13 terabyte database for code management, and every week 2,000 machines run 52,000 hours of regression tests.
An always-available IT infrastructure
Supporting them requires an always-available IT infrastructure. Oracle uses commodity hardware consisting of x86s running Linux, and virtualization software, and “we invest about one percent of our equipment in spares so we can hot swap when a server fails,” Sunday said.
That’s just part of the equation; another segment of Oracle’s business, Oracle University, offers 3,000 course titles, delivered to 145 training centers worldwide. This requires Oracle to configure 1,200 to 1,400 virtual environments spanning all its applications every week, Sunday said, adding that “the only way you can handle this is to highly automate the process.”
The courses are run for Oracle’s business partners and customers. They generated revenues of $500 million in Oracle’s 2008 fiscal year, Sunday said.
Next page: Oracle On Demand
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Then there’s Oracle On Demand, which has 3.6 million users. To manage this business, which saw revenues of $557 million in FY 2008, Oracle relies creates virtual pods that deliver independent environments with software as a service (SaaS)
To manage its global business, Oracle engaged in massive consolidation between 1998 and 2002. “We needed to be able to answer a simple question like ‘who’s my customer?’ Sunday said. So, the company “decided to have only one organization for business processes, in functional areas like human resources,” Sunday told his audience.
Then, it consolidated its more than 40 datacenters to three. Next, it standardized its networks globally, then standardized on processes and applications. “We put in a single global business instance for supporting all business functions worldwide,” Sunday said. “This, with collaboration and self service, gave us one global organization.”
In an earlier keynote, Cisco vice president Rajiv Ramaswami the move to consolidate and standardize networks in the enterprise is inevitable.
Oracle’s profitability jumped as a result of its consolidation and standardization efforts. “We achieved a 15-point increase in margin,” Sunday said.
These factors also contributed to Oracle’s 20 percent compound growth rates in each of the last five years, and helped the company manage its mergers and acquisitions, according to Sunday.
“We couldn’t have consolidated the 50 operational companies we bought and realized the synergies from those purchases without having standardized everything, both the infrastructure and the process,” he said.
Another major driver for Oracle, as it is for other enterprises, is virtualization, which lets it “leverage our hardware and network more effectively and enables rapid deployment using grid techniques,” Sunday said.
The results would gladden the heart of any accountant. Since Oracle launched its virtualization initiative 18 months ago, it has increased CPU utilization from seven percent to 73 percent, increased revenue per server five times, increased the server to administrator ratio 10 times, and is now using one-sixth the hardware it would otherwise use, Sunday said.
Next page: Upgrading 10,000 CPUs in 24 hours
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Upgrading 10,000 CPUs in 24 hours
Virtualization has also made upgrading Oracle’s systems faster. The company recently upgraded 10,000 CPUs within a 24-hour window over a weekend, Sunday told his audience.
His goal “is to have a physical environment which I run largely as a pool or cluster of virtual machines,” Sunday said. Oracle’s grid spans multiple physical datacenters, and supports all its applications, internal, for Oracle University or the vendor’s on demand offerings, Sunday said.
Oracle has its own virtual machine, Oracle VM, announced by company president Charles Phillips at its OpenWorld conference in San Francisco in November. This is based on the Xen open source hypervisor.
The virtual machines run on Linux, which has also benefited Oracle greatly. About 90 percent of Oracle’s environment runs on Linux. The remaining roughly 10 percent “are not Linux, and they account for 90 percent of our support and maintenance costs” Sunday said.
In addition to being “the largest enterprise user of Linux in the world” according to Sunday, Oracle offers Oracle Unbreakable Linux, based on Red Hat Linux and downloadable from Oracle’s Web site for free.
