For one, certain security features, querying tools and other areas don't work correctly if the multitenancy is done at the application layer, he added.

He also made the pitch for multitenancy as a way to ease the burden on corporate IT departments.

"Typically companies have hundreds, even thousands of separate databases," he said. "This becomes very expensive. You have to back up these thousands of databases. You have to buy hardware."

The multitenant capabilities in 12c provide "huge efficiency gains," Ellison said.

Oracle database 12c will be released in "calendar year 2013," an announcer stated prior to Ellison's keynote.