Oracle Plus Sun: What does it mean?
I guess this is one way to start a Monday morning. After IBM decided to pass on Sun, Oracle decided that it would be a great idea. While I have as many questions as answers, here are my top ten thoughts about what this combination will mean to the market:
1. Oracle’s acquisition of Sun definitely shakes up the technology market. Now, Oracle will become a hardware vendor, an operating system supplier, and will own Java.
2. Oracle gets a bigger share of the database market with MySQL. Had IBM purchased Sun, it would have been able to claim market leadership.
3. This move changes the competitive dynamics of the market. There are basically three technology giants: IBM, HP, and Oracle. This acquisition will put a lot of pressure on HP since it partners so closely with Oracle on the database and hardware fronts. It should also lead to more acquisitions by both IBM and HP.
4. The solutions market reigns! Oracle stated in its conference call this morning that the company will now be able to deliver top to bottom integrated solutions to its customers including hardware, packaged applications, operating systems, middleware, storage, database, etc. I feel a mainframe coming on…
5. Oracle could emerge as a cloud computing leader. Sun had accumulated some very good cloud computing/virtualization technologies over the last few years. Sun’s big cloud announcement got lost in the frenzy over the acquisition talks but there were some good ideas there.
6. Java gets a new owner. It will be interesting to see how Oracle is able to monetize Java. Will Oracle turn Java over to a standards organization? Will it treat it as a business driver? That answer will tell the industry a lot about the future of both Oracle and Java.
7. What happens to all of Sun’s open source software? Back a few years ago, Sun decided that it would open source its entire software stack. What will Oracle do with that business model? What will happen to its biggest open source platform, MySQL? MySQL has a huge following in the open source world. I suspect that Oracle will not make dramatic changes, at least in the short run. Oracle does have open source offerings although they are not the central focus of the company by a long shot. I assume that Oracle will deemphasize MySQL.
8. Solaris is back. Lately, there has been more action around Solaris. IBM annouced support earlier in the year and HP recently announced support services. Now that Solaris has a strong owner it could shake up the dynamics of the operating system world. It could have an impact on the other gorilla not in the room — Microsoft.
9. What are the implications for Microsoft? Oracle and Microsoft have been bitter rivals for decades. This acquisition will only intensify the situation. Will Microsoft look at some big acquisitions in the enterprise market? Will new partnerships emerge? Competition does create strange bedfellows. What will this mean for Cisco, VMWare, and EMC? That is indeed something interesting to ponder.
10. Oracle could look for a services acquisition next. One of the key differences between Oracle and its two key rivals IBM and HP is in the services space. If Oracle is going to be focused on solutions, we might expect to see Oracle look to acquire a services company. Could Oracle be eyeing something like CSC?
I think I probably posed more questions than answers. But, indeed, these are early days. There is no doubt that this will shake up the technology market and will lead to increasing consolidation. In the long run, I think this will be good for customers. Customers do want to stop buying piece parts. Customers do want to buy a more integrated set of offerings. However, I don’t think that any customer wants to go back to the days where a solution approach meant lock-in. It will be important for customers to make sure that what these big players provide is the type of flexibility they have gotten used to in the last decade without so much pain.
Judith Hurwitz's Cloud-Centric Weblog 
Care to elaborate on your thoughts in item 4….I feel a mainframe coming on….
I think that Oracle is saying that customers don’t want to buy piece parts — they want to buy integrated systems. This is what customers have been buying for decades with the mainframe. I actually think that if you take the architecture of the mainframe and add industry standards at the core you have a viable solution to the integration and scalability customers need.
Judith:
Great thoughts. Interesting to think of what this means to the other hardware vendors yes, but what about what it means to the former other ‘software only (if you discount the game station) vendor Microsoft.
Also what does this say about Cisco which is trying to get into the server business? Is Cisco a part of this landscape, and did they blow their best chance to get into this business.
Is it really possible for Oracle to continue to support MySQL?
I have to say, I believe that this is in fact a game changing move, and brilliant on the part of Oracle.
It is indeed game changing. A lot of its future impact will be how Oracle goes about balancing many factors from how it deals with being in the hardware business to what it does with open source offerings like MySQL. The one thing we can say for sure is that things will change dramatically.
Good analysis Judith,
I’ve been penning my thoughts from a slightly different angle at http://tinyurl.com/oracle-and-sun
Peter
Very interesting perspective. Thanks for adding some great insights (as always!) Judith
What happens to the already confusing Oracle SOA Product Roadmap? AquaLogic is still being integrated and combined with Oracle SOA Suite, now add CAPS and Glassfish to the mix. And Glassfish is opensource– yikes! Great opportunity for consultants to stitch this all together!
Someone will be very busy trying to untangle the massive amount of software assets that Oracle picks up from Sun
I agree with Skip and others. Let’s not forget Cisco’s play too. I think they’re all ultimately shooting for the IBM integrated model now. It’s about revenue growth and account ownership.
But Oracle (and even Cisco) will be struggling for the first few years as they find themselves as computing hardware vendors… their sales forces & service arms will overlap, and they’ll offend many traditional partners.
Judith,
Glad to see that the pingback (above) worked – you never can tell with blogs!
I have also compiled a more considered piece on Oracle and Sun today, drawing on the thoughts of people in the blogosphere and on various on-line forums. This can be found at:
http://peterthomas.wordpress.com/2009/04/21/combinatorics/
Peter
Excerpts from my recent email comments to a reporter about the acquisition, specifically regarding Sun’s hardware assets:
I simply don’t see Oracle changing the competitive landscape (certainly not in the way Cisco has). In fact, I expect this acquisition to put a strain on Oracle – a distraction that storage competitors will undoubtedly exploit. And, I don’t expect to see ANY real storage innovations come out of Oracle over the next couple of years.
We may see a mass exodus of Sun customers over the next couple of years unless Oracle presents a clear and compelling vision for its customers. Note: the recent announcement was not it.
Sun’s tape is now up in the air….I mean really, what the heck is Oracle going to do with STK remnants in a market that’s not dead but slowly dying? Did I just say that aloud? I’d like to see the tape assets sold off to a company that is willing and able to actually support them over the next several years, but who?
I just don’t believe Oracle has what it takes to play in storage hardware. Bringing Peoplesoft into the fold was one thing, Sun hardware is a completely different animal….apples and oranges. And I suspect it’ll be a while before Oracle clearly articulates its storage ambitions…that ought to fuel customer feelings of uncertainty.
Joseph,
Maybe Oracle don’t want the hardware pieces and will look to sell / spin these off.
Peter
Hi Peter,
Yes, I’ve read several articles written from that point of view. So far, at least, that does not seem to be a view shared by Oracle. Time will tell.
Amazing Article , I thought it was exceptional
I look forward to more interesting postings like this one. Does Your Blog have a newsletter I can subscribe to for new posts?
We’re working on our new website and we will have a newsletter that will alert you to new blog posts. You can also subscribe via the RSS feed. I am glad you enjoyed the blog post. Thanks!