Who’s the SaaS daddy? Marc Benioff? Nope. Zach Nelson? It appears not. The real leader of the pack is Lawrence J Ellison, who’s been pushing SaaS for the past nine years. Or so Oracle President Charles ‘Chuck’ Phillips told CIO this week when he stopped off in London.

“We have about 2 million users of on demand,” he said. “”We’ve been doing it for around nine years. Our customers wanted to own the software and then decide if they want to run it themselves or give it to us to run. They want those two decisions to be separate. They might want to keep it on demand, or they might want to bring it back in house at some point. We are almost indifferent about which option they prefer. The issue that they have is whether they want it outsourced.”

Whoaaa there! Outsourced? Surely that’s… well, outsourcing, not software as a service? What about the multi-tenant architectures that Salesforce.com and NetSuite et al keep on about, surely that’s a critical part of a genuine SaaS offering? Like Siebel CRM On Demand, for instance. “Multi tenant has nothing to do with on demand,” says Phillips. “Many customers don’t want to put all their data in one database – and in some industries it’s actually illegal to mingle data in one database.”

That’s actually an interesting spin to put on SaaS and one that it would be interesting to get a response from the SaaS pureplays on. Nonetheless it’s clear that Oracle is rather loosely throwing around terms like SaaS, on demand and outsourcing and happily allowing the definitions to become blurred. “None of the vendors do SaaS in the same way,” says Phillips simply.

But however it's defined, it’s clear that it’s a lucrative business. “On demand is going to be one of the growth markets for us,” said Phillips. “We can give customers a choice in that we offer and integrate both on demand and on premises and make it look like a single architecture. From a customer point of view they can have CRM on demand or on premise or both. We can sell to Siebel customers who want to do something thing on demand and keep some things in house. Whatever decision they want to take, we can accommodate it.”

Of course, SaaS is also a good sales opportunity for Oracle’s database business. Phillips argues that customers of pureplay SaaS providers are likely to deem it wise to replicate data behind their own firewalls – which means a database sale or two – presumably in case the database underpinning the SaaS service goes down. Like Salesforce.com over Christmas when it suffered outages caused by a database from… Oracle.