SAN FRANCISCO — Oracle kicked off its annual user conference here today with news of an acquisition and an announcement that it's plotting to slice off a piece of the cloud services market for itself. 

Oracle is buying Santa Clara, Calif-based Palerra, a cloud security startup that helps organizations protect their business-critical cloud infrastructure and data. It was co-founded by Oracle alums Rohit Gupta (its CEO) and Ganesh Kirti (CTO). 

Founded in 2013, Palerra claims to be the first Cloud Access Security Broker (CASB) to automate the entire security lifecycle, from threat detection to remediation. The privately held company was backed by Norwest Venture Partners, Wing Venture Capital and August Capital.

Palerra’s CASB product called LORIC, which is designed to protect and assure compliance of applications, workloads and sensitive data stored across cloud services, should help Oracle boost its security stack. Terms of the deal, subject to customary closing conditions, were not disclosed.

The Palerra team is expected to join Oracle, "bringing significant knowledge and capabilities to Oracle," according to Peter Barker, SVP of Identity Management and Security Products at Oracle.

OpenWorld Agenda

In announcing quarterly earnings this week, Oracle said it would introduce its second generation of its Infrastructure-as-a-Service (IaaS) platform during Oracle OpenWorld. The conference kicked off today and continues through Thursday at the Moscone Center here. 

CTO Larry Ellison wasted no time, revealing Oracle's IaaS plans in detail during the opening keynote. This time the target is Amazon Web Services (AWS), which is currently king of the IaaS  sector. It’s no small task, with both Microsoft and Google making major investments in this space and Oracle only a minor player.

But Ellison said Oracle is "aggressively moving into infrastructure." He promised a "new generation of data centers around the world," as well as IaaS that would be cheaper and faster than that offered by AWS.

Learning Opportunities

Oracle: 3 is a Cloud

IaaS is one of the triumvirate of cloud services offered alongside Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS). IaaS provides networking services, storage and computing through Oracle’s servers for businesses that rent out the space.

Amazon dominates this sector, bringing in $718 million in income and $2.88 billion in revenue in this year’s second quarter. The main competitors are Microsoft Azure and Google Cloud Platform, with IBM also making a run. Oracle is currently just a small blip on the screen in comparison to the others. By comparison, the AWS second quarter operating expenses in this area was $2.02 billion, while it was only $96 million for Oracle.

Oracle has had success with other cloud offerings, by comparison. The company posted revenues of $798 million for its SaaS and PaaS  during an earnings report on Sept. 15. The challenge will come in taking on companies with deep pockets and investment in this area. Oracle is no slouch when it comes to cash, but Microsoft and Google have spent heavily and restructured some elements of their business for a long haul in this marathon.

Ellison isn’t immune from making big promises about how the company will invest in the cloud. Last year’s event was also a cloudfest, with a major focus on SaaS and PaaS offerings, while also supporting more of the traditional sectors of where Oracle has had a lengthy presence.

CMSWire will be on the ground for Oracle OpenWorld to cover the major announcements and other updates worth highlighting.