More Speculation Oracle Is Planning A Future With Sun’s Hardware


If you listened to Oracle’s fourth-quarter conference call two weeks ago, you were likely struck by the company's emerging strategy that software and hardware do mix.

Larry Ellison laid out his argument that integration from top to bottom – across server, operating system, database, middleware, and application – is a better way to go.

The mercurial CEO pointed to the Exadata database machine for data warehouses as the company’s “first experiment.” Oracle unveiled the machine last fall and boasts that it is selling extremely well – though chest puffing is a common trait at the company even when it is not warranted.

The strategic implications for Oracle’s planned acquisition of Sun are profound. Integration from Sun’s servers to Oracle’s application stack represents a departure not only for Oracle but for the business software industry, which has generally touted individual products and left hardware decisions to customers given the increasing commoditization of computers.

If indeed Oracle is looking toward life with a hardware division – and not intending to sell it off - it will be interesting to see how competitors SAP and IBM respond.

On Monday, industry pundit Bruce Richardson said he is becoming more convinced that Oracle’s heart is in the deal.

Even though the Justice Department has issued a second request for information, “it still appears the deal will be completed by the end of August,” said Richardson, chief research officer at AMR Research.

With that date in mind, the buzz is that Oracle is eager to hire supply-chain talent to try to make servers and chips into a profitable business, he wrote in a blog post.

If this is true, and if Oracle’s integration strategy begins to capture the interest of some customers, watch out. The business software industry is about to make another 90-degree change of direction.