Oracle and Microsoft have signed a deal that will see Oracle colocate its Exadata database-optimized server and Real Application Clusters in Microsoft Azure data centers.

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– Microsoft News

By doing so, the companies are now offering the "Oracle Database@Azure" which will mean that both Oracle and Azure customers can use a low-latency solution to mix their data with Microsoft's applications and infrastructure via the Azure portal. The offering will be available in multiple availability zones.

Exadata, according to Oracle, offers latency of less than 20 microseconds and can process tens of millions of operations per second across petabytes of data. The decision to colocate in Azure facilities means that customers will no longer have to pay to move their data out of Azure and to Exadata.

Customers can instead use Oracle's migration services and Azure Consumption Commitment credits to purchase Database@Azure services. Oracle will operate and manage the service.

In an update posted to YouTube from both companies, Microsoft CEO Satya Nadella and Oracle CTO Larry Ellison explained that the new offering will be particularly helpful for artificial intelligence (AI) as data needed may be stored in Oracle's databases.

Additionally, Oracle hopes the plan will help more of its customers move to the cloud.

"A lot of our customers had moved partially to the cloud," Ellison said. "Actually, a majority of the data has not migrated from on-premise into the cloud as yet, but it will. And we are trying to hasten that process to make it easier for customers to actually move their entire data center workload to the cloud. And that means moving all those Oracle databases, which are currently on-premise, into the cloud."

Oracle and Microsoft have an existing relationship. In 2019 the two launched an integration enabling customers to run computing jobs across both clouds, which necessitated direct fiber links between their data centers. In 2022, Oracle software was made available in the Azure Portal. This latest decision helps further expand that and reduce latency even further.

In May 2023, Microsoft and Oracle considered sharing AI servers amid the GPU shortages. Ultimately, Microsoft opted to sign a multi-billion deal with GPU cloud provider CoreWeave.