Larry's rant is an extraordinary example of whistling past the graveyard. Oracle's huge transformation over the last 10 years has been from an infrastructure company (databases & middleware) to an applications company (ERP, CRM, SFA, etc.). Now, just as this transformation is completed, along comes an infrastructure that will obsolete all the applications Oracle just got done rolling up....
No wonder he sounds ticked--you would be too if you just spent more than $30B...on a bunch of wasting assets that are going to be shafted by the Cloud/SaaS shift just as Siebel's market share was eviscerated by Salesforce.
Larry Ellison is a smart guy, and Oracle is a hyperaggressive company capable of beating most companies on the market. While Keene's macro view is probably spot-on, I suspect that Oracle isn't going to turn into Computer Associates overnight and start an inevitable decline.
No, Oracle has single-handedly assured its long-term appeal by consolidating the market around its database technology with that same $30 billion in acquisitions. It's not necessarily good for customers that are locked into Oracle to an increasing degree, so much so that they can offer but, but it's good for Oracle's profitability.
Still, I think there's something to software as a service. Will it change the world overnight? No, it has already failed to do that. But it's a long-term threat to an old-school way of delivering software, one enabled by the Web and ever-improving bandwidth. Ellison is safe today, but tomorrow? That's another chapter.