Oracle + Sun is big for the industry, but should we care?

JasonC

The amount of news and opinion coming out about this acquisition is just overwhelming, but there seem to be some themes emerging.

> It's bad for enterprise customers
Best line I've read in all the commentary came from Dennis Howlett here: http://blogs.zdnet.com/Howlett/?p=857. In response to Oracle's suggestion that this is a good thing, now customers can get all their IT needs from one vendor (software, hardware, etc) and have just one throat to choke, he says..."having a single throat to choke might sound like a good idea, but not when your testicles are in the 22% maintenance vise".

Fair (and hilarious) point. This could be a vendor lock in of the worst kind from a vendor spending billions on acquisitions, raking in billions in maintenance, but delivering precious little innovation from the proceeds.

> SAP is in play?
There seems to be some consensus that this puts IBM at risk as Oracle now offers alternatives to IBM from top to bottom. IBM has tried to play it neutral when it comes to ERP/CRM, but at this point Oracle has snapped up most of the large vendors that were avid supporters of IBM's platforms (PeopleSoft, J.D. Edwards, Siebel, etc). And Mr Howlett's point notwithstanding, some customers may be compelled by Oracle's single source argument. So I'm hearing SAP mentioned as an acquisition IBM might make in response.

That's a little hard to fathom as IBM's offer for Sun was just barely below Oracle's. An SAP acquisition would be so big an undertaking that it seems less risky and lest costly to just up the bid for Sun. That's ignoring for a moment that Larry Ellison and company have never lost an M&A bidding war.

An interesting point of view comes from Josh Greenbaum who suggests that IBM and Oracle actually could become much closer and more cooperative as a result of this...

He writes..."IBM and Oracle have too much at stake to suddenly dust it up over a little hardware competition. Nor does this mean that SAP must now become part of IBM. What is does mean is that SAP needs to reorder its thinking about one of its biggest allies — IBM — and begin to look at alternative partners to balance off a growing IBM/Oracle axis of competition. Steve Ballmer, you’re wanted on the phone…"

Read the rest of Josh's piece here: http://ematters.wordpress.com/2009/04/22/oracles-sun-deal-and-the-ibm-factor-things-may-not-be-what-they-appear-as-in-no-wedding-bells-for-sap-and-ibm/

And just to throw out another scenario, HP and IBM are now fierce rivals since HP picked up EDS (a big rival to IBM's consulting business). SAP has since then insulted IBM for doing shoddy implementations of its product (as if that's the only reason SAP projects go ridiculously over budget) and certified EDS as an implementation partner. If IBM and Oracle start to get real cozy, would HP put in a bid for SAP?

There are some other implications for open source, java, and the hardware market, but I think those mean less to us in the Dynamics world...

Thoughts?


Jason Carter
http://www.partnercompete.com