Hell has frozen over. Oracle founder Larry Ellison has made peace with Salesforce.com founder Marc Benioff. For those that have followed the evolution of the two firms’ rivalry as the cloud market has grown, this is one of the most surprising announcements in recent years.

Indeed, only as recently as late 2011, Ellison was kicking Benioff from his Oracle OpenWorld speaking slot, forcing the Salesforce chief to rock up at another hotel and give his keynote. However, it was smiles and handshakes – tightly gripped, one imagines – on Tuesday as the two firms announced their cloud partnership.

In a joint statement they explained that Salesforce would be migrating the core of its cloud computing platform to Oracle products including Database and Java Middleware. Additionally, the on-demand software pioneer will adopt Oracle Exadata systems and integrate Fusion HCM and Financial Cloud into its services.

Ellison gushed about the deal: “When customers choose cloud applications they expect rapid low-cost implementations; they also expect application integrations to work right out of the box – even when the applications are from different vendors.

“That’s why Marc and I believe it’s important that our two companies work together to make it happen, and integrate the Salesforce.com and Oracle Clouds.”

Not to be outdone in the love-in, Benioff rolled out the superlatives too: “Larry and I both agree that Salesforce.com and Oracle need to integrate our clouds. Salesforce.com’s CRM integrated with Oracle’s Fusion HCM and Financial Cloud is the best of both worlds: the simplicity of Salesforce.com combined with the power of Oracle.”

Ah, perhaps it was that classic of hate equals love all along. Of course, no one would be as naïve as to think the two IT heavyweights are doing this for each others’ health, and analysts were quick to point out there was plenty of mutual back-scratching taking place.

Bo Lykkegaard, research director for European Enterprise Applications at IDC, told V3 that the deal was very much a ‘marriage of convenience’ for the two firms.

“For Oracle, it’s a big sale, because now any Salesforce customer will be using Oracle data centres and transaction tools. It’s a great reference customer too, so they can look to sell their applications to those companies using Salesforce,” he said.

“By the same token, for Salesforce, Oracle has committed to better integration between their back office and financial applications and human capital management applications, so this will open up the installed based for Salesforce.”

Meanwhile, in what must have been a busy few weeks for the Oracle exec team, the firm also signed a notable partnership with Microsoft. The deal will see Microsoft’s Hyper-V and Azure support Oracle’s Database, Java and WebLogic Server platforms, as well as its Linux build.

Forrester analyst John Rymer said that the deal was a smart move for Microsoft as it would remove business headaches over support for Java within Microsoft products.

“With this licence, Microsoft can finally offer Java as a preinstalled, first-class environment on Windows Azure as well as its Hyper-V virtualisation software,” Rymer said in a blog post on the Microsoft/Oracle deal.
 
“Developers can and do run Java applications on Azure, but strictly as a ‘bring your own’ exercise; they were not able to get usage rights to and support for the technology from Microsoft. Without a licence, Java would always be a second-class denizen of Windows Azure.

“Now enterprise customers can get the legal air cover they require for crucial technologies. As a result, we expect to see much wider usage of Windows Azure for a wider range of Java applications.”

For Oracle, the deal means it has more chances to sell its applications by having support for Microsoft’s platform, as Lykkegaard from IDC explained.

“Oracle has so far worked with Rackspace and Amazon, so this tie-up with Azure is good for Oracle because it gives them a new deployment option, especially when they sell to customers that are strongly invested in Microsoft,” he told V3.

For now it is smiles all round, and later on Thursday Ellison and Benioff will be holding a ceremony to celebrate their union – an event Benioff is looking forward to:

V3 will be covering the event live to hear the speeches, and provide more information on the deals as the two star-crossed chief executives chat about the deal they have signed.