Oracle executives told user conference attendees in Philadelphia on Monday that more than 90 percent of new customers are choosing the cloud-deployed version of Oracle’s OTM and GTM products.
Oracle executives on Monday outlined the extent to which customers have gravitated toward the software company’s transportation management system (TMS) and global trade management (GTM) products.
Speaking at the Oracle Transportation Management Special Interest Group (OTM SIG) in Philadelphia, Oracle Vice President of Development Jim Mooney said the company has signed on 140 cloud customers across 15 industries in 25 countries for the TMS product. Those customers account for more than $10 billion in freight spend.
Oracle announced it would begin offering a cloud version of its TMS in the second half of 2014 and began deploying that version in the first half of 2015.
Mooney said cloud deployments have allowed Oracle, which has historically been known as an on-premise software provider, to tap into a new customer base of shippers that weren’t going to be able to deploy the on-premise version of OTM.
Mooney added that Oracle actually prefers new customers to start with the cloud-deployed versions of its TMS and GTM software.
Derek Gittoes, vice president of value chain execution strategy at Oracle, told the conference that more than 90 percent of new customers are using the cloud-deployed versions of OTM and GTM.
“The market has shifted,” he said. “Most of our new customers are coming to us via cloud. We now assume new customers will deploy via cloud.”
He said the median cloud customer has about $30 million in freight spend, and that Oracle hasn’t detected any difference in deployment patterns by industry. In other words, the decision to go with a cloud deployment isn’t dependent on the industry.
Gittoes did, however, say that small and medium-sized enterprises were more likely to choose a cloud deployment over larger enterprises, but that even preferences among larger companies was changing
In a conversation with American Shipper on the sidelines of the conference, Gittoes noted that cloud-based software was here to stay, and that a period of skepticism about cloud’s staying power was over. He agreed when asked if the cloud version of OTM had indeed allowed Oracle to tap into markets it previously never went after, segments that have over the past five years been targeted by cloud-deployed, subscription-based TMS providers.
In his presentation, Gittoes said that 50 percent of new OTM customers in the last year came from outside North America, a geographic dispersion he attributed to Oracle’s cloud deployment capabilities and its global ecosystem of implementation and extension partners.
“You’d be surprised how many companies we see coming to us that have no TMS or GTM,” he said. “But most companies start the year with their IT budget already spent ‘keeping the lights on.’ That’s why cloud has been so popular.”
The fee structure of cloud deployments allows companies to commit to smaller upfront investments, while implementations are generally quicker than on-premise ones.
It’s important to note that cloud-deployed OTM is not a single-instance, multi-tenant version of on-premise OTM, but rather a version where Oracle hosts the software and handles all the routine maintenance of the system. This version of cloud is often referred to as private cloud, whereas multi-tenant TMSs are referred to as public cloud solutions.
According to research from IDC Insights, OTM has the largest market in the TMS market.
OTM SIG is an annual user conference organized by OTM customers.
Cloud a clear choice for Oracle TMS customers
