Ellison, who turned 70 last month, said Thursday he’ll become executive chairman of the software company he co-founded decades ago and that he would become chief technology officer with responsibility for software and hardware engineering. The move, resonant of Bill Gates having become chief software architect of Microsoft when he resigned as CEO, changes relatively little about how Oracle runs. As Oracle noted in its news release, engineering already reports to Ellison.

Not much changes for Oracle’s new CEOs either.

Safra Catz has been Ellison’s Ms. Inside for years, with responsibility for finance, legal and manufacturing. She has long been Ellison’s iron fist, ensuring that his will was done within the walls of the company. (My 2009 profile of Catz called her “The Enforcer.”) As CEO, Catz will continue to oversee the same functions, including Oracle’s prodigious acquisitions engine.

As for Mark Hurd, he will carry on as Oracle’s Mr. Outside, running sales, service and Oracle’s “vertical industry global business units,” which is a fancy way of referring to the company’s marketing machine. Hurd is a born sales manager, as I detailed during his earlier, halcyon days as CEO of Hewlett-Packard. (Read “Mark Hurd’s moment,” written a few months before I profiled Catz.) He came to Oracle following an ignominious departure from HP, with Ellison boldly hiring a high-profile executive from a combination partner-competitor in the middle of Hurd’s very public spat with his former board of directors.

The interesting thing about Catz and Hurd sharing duties as CEO is that when Hurd joined Oracle no one believed the two would get along. Catz, the longtime consigliere to the billionaire boss she clearly revered, was expected to shun Hurd. Hurd, a shrewd and canny operator with an appetite for power and money, was expected to have little patience for Catz.

By many accounts, even before Thursday’s announcements, those expectations were completely wrong. Catz and Hurd—neither technologists, both financially savvy, both extremely well compensated—appear to have quickly carved up their respective turfs and then run them ruthlessly. Catz and Hurd are deeply and equally unpopular with the troops at Oracle. But they are said to stick to their knitting, with Catz mingling when necessary with bankers and internal executives, grateful to leave conversations with customers to Hurd.

So why make this move at all?

The assumption is that Ellison finally decided that given all his various interests—sailing, tennis, real estate, sailing—he might as well acknowledge his distractions and give up the CEO job. It’s a fair assumption but still a head scratcher. Larry Ellison’s distractions are hardly news-alert worthy.

An explanation that cuts closer to the truth is Ellison’s recognition—and perhaps Oracle’s board’s as well—that Oracle had just blown it for too long to continue business as usual, at least for appearances sake. Oracle (ORCL) has been egregiously late to embrace cloud computing, an entirely different business model for selling software that lets corporate customers use only what they need from remote computers rather than housing expensive software on their own premises. “Oracle has been missing more than they were making for some time,” says Brent Thill, a research analyst for UBS who has been following Oracle for about as long as anyone on Wall Street. “Directionally, there may be some things Larry has to be involved in. But there’s a perception he hasn’t been as engaged.”

The wondrous thing about Larry Ellison is that he’s always done exactly what he wanted to do when he wanted to do it. Now he’s turning over the keys to his prized company to two handpicked deputies. Just not completely.