The Case for ETL in the Cloud - CAPEX vs OPEX

Recently Oracle announced a new cloud service for Oracle Data Integrator. Because I was helping our sales team by doing some estimates and statements of work, I was already thinking of costs, ROI, use cases, and the questions behind making a decision to move to the cloud. I want to explore what is the business case for using or switching to ODICS?

Oracle Data Integration Cloud Services

First, let me briefly talk about what is Oracle Data Integration Cloud Services? ODICS is ODI version 12.2.1.2 available on Oracle’s Java Cloud Service known as JCS. Several posts cover the implementation, migration, and technical aspects of using ODI in the cloud. Instead of covering the ‘how’, I want to talk about the ‘when’ and ‘why’.

Use Cases

What use cases are there for ODICS?

1. You have or soon plan to have your data warehouse in Oracle’s Cloud. In this situation, you can now have your ODI J2EE agent in the same cloud network, removing network hops and improving performance.
2. If you currently have an ODI license on-premises, you are allowed to install that license on Oracle’s JCS at the JCS prices. See here for more information about installing on JCS.
3. If you currently have an ODI license on-premises, and you don't need the full functionality of ODI JEE agents, you can also use standalone ODI agents in the Oracle Compute Cloud. These use cases are described in a webinar posted in the PM Webcast Archive.

When and Why?

So when would it make sense to move towards using ODICS? These are the scenarios I imagine being the most likely:

1. A new customer or project. If a business doesn’t already have ODI, this allows them to decide between an all on-premises solution or a complete solution in Oracle’s cloud. With monthly and metered costs, the standard large start-up costs for hardware and licenses are avoided, making this solution available for more small to medium businesses.
2. An existing business with ODI already and considering moving their DW to the cloud. In this scenario, a possible solution would be to move the current license of ODI to JCS (or Compute Cloud) and begin using that to move data, all while tracking JCS costs. When the time comes to review licensing obligations for ODI, compare the calculation for a license to the calculation of expected usage for ODICS and see which one makes the most sense (cents?). For a more detailed explanation of this point, let’s talk CAPEX and OPEX!

CAPEX vs. OPEX

CAPEX and OPEX are short for Capital Expense and Operational Expense, respectively. In a finance and budgeting perspective, these two show up very differently on financial reports. This often has tax considerations for businesses. Traditionally in the past, a data warehouse project was a very large initial capital expenditure, with hardware, licenses, and project costs. This would land it very solidly as CAPEX. Over the last several years, sponsorship for these projects has shifted from CIOs and IT Directors to CFOs and Business Directors. With this shift, several businesses would rather budget and see these expenses monthly as an operating expense as opposed to every few years having large capital expenses, putting these projects into OPEX instead.

Conclusion

Having monthly and metered service costs in the cloud that are fixed or predictable are appealing. As a bonus, this style of service is highly flexible and can scale up (or down) as demand changes. If you are or will soon be in the process of planning for your future business analytics needs, we provide expert services, assessments, accelerators, and executive consultations for assisting with these kinds of decisions. When it is time to talk about actual numbers, your Oracle Sales Representative will have the best prices. Please get in touch for more information.