The two industry leaders have competed for decades to sell technology to the world's largest companies. But they face growing pressure from more nimble rivals selling often-cheaper services based in remote data centers and they are rushing to adapt.
Under the agreement, customers will be able to run Oracle software on Microsoft's Server Hyper-V and on Windows Azure platforms, the companies said.
Microsoft will offer Oracle's Java, Oracle Database and Oracle WebLogic Server to Windows Azure customers, while Oracle will also make Oracle Linux available to Windows Azure customers, the companies said in a news release.
No. 3 software maker Oracle last week missed expectations for software sales for the fourth quarter, sending its shares plunging. Investors worried that the company may have trouble competing with software providers like Salesforce.com and Workday, as well as Amazon.com, which has also become a major player in cloud computing infrastructure.
Top software maker Microsoft's large-scale cloud computing initiative, called Azure, has failed to catch up with Amazon's cloud offering, called AWS (Amazon Web Services), which blazed the trail in elastic online computing services in the cloud.
(Reporting by Noel Randewich Additional reporting by Jim Finkle in Boston and Bill Rigby in Seattle; Editing by Richard Chang)