Oracle Open World opens up on Sunday with a keynote at the Moscone Center in San Francisco. The annual convention will attract about forty thousand people to the Bay area and promises to be exciting and interesting on multiple levels.
This will be the first Open World post Oracle’s acquisition of computer pioneer Sun Microsystems. Last year Oracle introduced a version of its Exadata storage unit based on Sun architecture (and presumptive deal close) and with the company finally in the fold you can bet there will be more product announcements that mix hardware and system software.
I don’t know if there will be net new announcements, but Sun was the driver of the Java revolution and reduced instruction set computing among other things, so I think it’s way safe to say there will be interesting things coming out of that camp.
This is also the first year post limited release of Oracle’s Fusion architecture. Fusion, you may recall, is a platform intended to unify the many disparate applications that Oracle bought up a few years ago. It is also the platform for merging and rebuilding applications along a more or less consistent Oracle product direction. With another year of development and roll out of Fusion, there will be much more to discuss and announce next week.
There’s also cloud computing to consider. A little over a year ago Larry Ellison was caught on tape at the Churchill Club pooh-poohing cloud computing but that was before Oracle really had a dog, a pack actually, in the hunt. Now that Oracle is better positioned, and given that Oracle’s database and servers support so much of cloud computing, look for Oracle to claim credit for the sunrise — to paraphrase an old Bill Clinton line.
Then, too, you can expect the usual shenanigans from a whole host of characters and partners. Everyone in this business today is into coopetition so look for fun announcements from Dell, HP (we want our secrets back) and Salesforce.com for starters.
Speaking of Salesforce, back by popular demand (or whatever) Marc Benioff will again address a crowd at the Yerba Buena Theater just down the street from the conference. Last year’s inaugural talk was expected to be some kind of challenge to Oracle but turned out to be a very successful symbiotic and statesman-like address. Too bad too because we all waited outside in the rain for the doors to open expecting something more combustible. This year, I hope it’s a sunny day.
On the CRM front, Anthony Lye and company have been working hard all year (Sounds like Christmas and the North Pole, doesn’t it?) to advance the front office suite on multiple fronts. The CRM team has scheduled two hundred sessions for the conference just on CRM. Forget the database, Java and Sun, if you’re into CRM the conference will have you drinking from a fire hose.
Trying to register for sessions is a Byzantine process though, which uses an on-line system that looks like it was built by monkeys on crack. To keep my sanity I have decided not to register for anything but to simply show up. I have a hard copy schedule. I know this strategy might exclude me from a few popular sessions but I figure that’s what beers are for.
The real star of the show, for me, will be the city of San Francisco. It’s not a perfect place for sure, but there is a wonderful energy in the city any time and it’s triply true during Open World and Dreamforce. You walk around high on the possibilities uncovered in the sessions and accented by the environment — the hills, the cable cars, the fog, the restaurants and most importantly the indefatigably optimistic crowd of natives and visitors. Did I mention the California wines?
I digress. One week till Open World. I don’t know what will be announced because I won’t get briefed till later and then I’ll be in quarantine. So, I don’t know any more than you. But I can’t wait.
Approves Oracle’s acquisition of Sun
The bureaucrats in the EU finally stopped looking through the wrong end of the telescope long enough to approve Oracle’s purchase of Sun Microsystems. The deal had been held up for months while the EU tried to decide if the acquisition, which included MySQL, a database product bought by Sun in 2008, would have a deleterious effect on innovation in the database market. They finally decided it would not.
As a practical matter, innovation in the database market peaked many years (decades?) ago when the market began to consolidate around Oracle and the seven (or three, whatever) dwarfs. The market took care of trimming the number of databases and market demand did the rest, forcing Oracle and IBM (DB2) to develop more and better product features over time.
I am not so much of a free market enthusiast to think that everyone is a rational player (we humans are no such thing) and that the market always produces the best result — Voltaire’s Dr. Pangloss put a permanent hole in that hull. But I do believe, in this case at least, that Oracle and Sun have a clear understanding of the economic forces that are driving them into the first (?) hardware-software consolidation in the industry.
True enough, IBM is and has been a formidable supplier of gear, software and services. But absent any initiative to break up Big Blue, I can see no justification for holding up the Oracle-Sun merger. So now the merger proceeds and the bigger question will be how Hewlett-Packard responds.
Originally published on Monday
Ahh, what to make of this? Good? Bad? Creative destruction? All of the above? Probably. Of course, it is too early to offer more than a few prognostications but that is what’s so much fun about this.
First, Sun’s shareholders got a dime more per share than the IBM offer $9.50 vs. $9.40 whoo hoo! Seriously, a dime over millions of shares is a lot of money—think about a good weekend in Vegas.
More seriously, the deal complicates Oracle’s relationship with Dell and HP which Oracle has courted aggressively recently. Last September Larry Ellison introduced the Exadata—part storage array part computer built in cooperation with HP to provide orders of magnitude better support for terabyte and bigger databases. A good idea. But now where does the budding relationship with HP go?
On the other hand, I wish I had a proverbial nickel for every Oracle database that was sold on a Sun box over the last three decades. Sun’s customers are Oracle’s customers but the same can be said of HP.
Oracle made a concerted effort a few years ago to maintain its position as a lead dog in the software market. With it comes stature for sure but also the market position to drive pricing in an era that will continue a long trend toward greater affordability. Too many businesses and their business processes are absolutely dependent on IT hardware and software and that dependency drives an absolute need for cost containment. The best way to get cost containment is to vertically integrate and that is what Oracle is increasingly doing.
Vertical integration can happen in two ways. Oracle is following a more or less time-honored approach of owning all of the factors of production and presumably selling bundles of technology in the future. I think Adam Smith would approve. The other approach, interestingly enough, is to verticalize a la Salesforce.com. Hiding all of the stack, hardware and labor behind the cloud enables the same kind of economy of scale. The first approach is decidedly 20th century the latter tacks to the 21st. The newer approach aggressively commoditizes infrastructure. Oracle must see this and presumably it has determined it is better to drive the commoditization process than to be the victim of it.
Oracle’s acquisition of Sun is a necessary next step for the company if it expects to continue growing and to compete with rivals like IBM and HP each of which is pursuing a variant of the 20th century model. Will it be enough? Probably. In any event we still need—and will for a long time—companies that make the hardware on which the cloud computing infrastructure runs. I think of this news as interesting, not wholly unexpected and symptom of the economic forces every industry is subject to.
Today is Patriots’ Day in Massachusetts, no big deal in most other parts of the world but today we celebrate the battles of Lexington and Concord, which started the American Revolution. Those battles are famous for the “shot heard ‘round the world” and I suppose much the same could be said of Oracle’s acquisition of Sun. This could not have been planned but it offers an interesting historical note.