Oracle CEO Mark Hurd explains how the cloud is helping the company use its lawyers less (ORCL, AMZN)

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May 4, 2017 8:22 PM

Oracle co-CEO Mark Hurd says the cloud has required the company to rethink its approach to big customer contracts.

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At a media event at Oracle's Silicon Valley headquarters, co-CEO Mark Hurd told Recode's Kara Swisher that the switch to cloud computing — where customers rent functionally unlimited supercomputing power and applications from companies like Oracle — has required Oracle to rethink this approach, at least a little.

(Swisher's full conversation with Hurd will be featured in a forthcoming episode of the Recode Decode podcast.)

Hurd uses the example of ride-hailing app Lyft, a flagship customer of Oracle's accounting and financial cloud software.

"Historically," Hurd says, Oracle would write "big contracts" for customers, the procurement department would vet it, lawyers for both sides would negotiate the terms, and that would be that. But startups like Lyft don't have a formal procurement department, or the same kind of IT buying process as those big Fortune 500 companies.

It means "we can't show up with lawyers and stuff," says Hurd. And so, Hurd explains, Oracle took all the terms that would be in the normal contract, and made it something in which a customer can simply "click to accept" — sort of like the iTunes consumer terms of service.

In the standard contract negotiation process, says Hurd, customers would usually ask for special terms, and "80% of the time, i

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