Methinks that sometime soon, the good folks over at IBM will be kicking themselves. Hard.
When I heard that IBM was trying to acquire Sun, it seemed like a no-brainer. Even if a little part of their motivation was to spite Microsoft, IBM has long been a driving force behind Java's successes. In recent years, they've spearheaded the very successful Eclipse project, acquired Rational, continued to invest in Websphere... So, to have Sun and IBM under the same banner just seemed to be the perfect union between very different but nonetheless compatible companies.
Well, it wasn't meant to be. After IBM dropped negotiations, Sun Microsystems was left at the altar, wondering what had happened.
Caught you on the rebound
The bouquets from the cancelled IBM/Sun wedding hadn't even faded when Oracle entered the scene and, for a paltry 10 cents more a share ($9.50 vs $9.40, or 1.06% difference), swept up a darling of the industry that had been reeling since the "dot com" bubble burst in the early 2000's.
This unexpected acquisition is a great example of how a company can leverage its strengths (e.g. solid product, reputation, cash reserves) to build up a foundation for further success. In this case, given the level of trust that people (customers and potential customers) already have in their DBMS, I can easily imagine Oracle developing and packaging Oracle-branded turnkey hardware+software DBMS solutions à la Google Search Appliance.
Whether you're talking about a rack-mounted cluster of servers or a single box, they will be able to deliver and support integrated solutions featuring Sun hardware, Solaris and the latest version of Oracle. Just brand it all as an Oracle product, set up a clear (subscription-based?) fee structure and start printing money. If they do it right, Oracle may well have hit a home run with this acquisition.
Et tu, Java?
As for the Java angle, well, Oracle is already closely integrated with Java (see: Java stored procedures in Oracle), so on the technical side they'll be working in known territory. What remains to be seen is whether they will be able to increase Java's market share and what they will do with fledgling initiatives such as JavaFX.
I'm also particularly curious to see how IBM will react on the Java front. I can' t imagine them moving to a scorched earth policy and trying to sabotage the progress that Java has made in recent years, but even if they just lose some of their zealousness, it could damage the Java market overall. I personally believe that without IBM's support over the years, Java would never have had the level of success it has enjoyed. Oh well, we'll find out soon enough.
Congratulations, Oracle. Now go forth, be fruitful and multiply.
As always, thank you for reading and I invite your comments on this topic.
When I heard that IBM was trying to acquire Sun, it seemed like a no-brainer. Even if a little part of their motivation was to spite Microsoft, IBM has long been a driving force behind Java's successes. In recent years, they've spearheaded the very successful Eclipse project, acquired Rational, continued to invest in Websphere... So, to have Sun and IBM under the same banner just seemed to be the perfect union between very different but nonetheless compatible companies.
Well, it wasn't meant to be. After IBM dropped negotiations, Sun Microsystems was left at the altar, wondering what had happened.
Caught you on the rebound
The bouquets from the cancelled IBM/Sun wedding hadn't even faded when Oracle entered the scene and, for a paltry 10 cents more a share ($9.50 vs $9.40, or 1.06% difference), swept up a darling of the industry that had been reeling since the "dot com" bubble burst in the early 2000's.
This unexpected acquisition is a great example of how a company can leverage its strengths (e.g. solid product, reputation, cash reserves) to build up a foundation for further success. In this case, given the level of trust that people (customers and potential customers) already have in their DBMS, I can easily imagine Oracle developing and packaging Oracle-branded turnkey hardware+software DBMS solutions à la Google Search Appliance.
Whether you're talking about a rack-mounted cluster of servers or a single box, they will be able to deliver and support integrated solutions featuring Sun hardware, Solaris and the latest version of Oracle. Just brand it all as an Oracle product, set up a clear (subscription-based?) fee structure and start printing money. If they do it right, Oracle may well have hit a home run with this acquisition.
Et tu, Java?
As for the Java angle, well, Oracle is already closely integrated with Java (see: Java stored procedures in Oracle), so on the technical side they'll be working in known territory. What remains to be seen is whether they will be able to increase Java's market share and what they will do with fledgling initiatives such as JavaFX.
I'm also particularly curious to see how IBM will react on the Java front. I can' t imagine them moving to a scorched earth policy and trying to sabotage the progress that Java has made in recent years, but even if they just lose some of their zealousness, it could damage the Java market overall. I personally believe that without IBM's support over the years, Java would never have had the level of success it has enjoyed. Oh well, we'll find out soon enough.
Congratulations, Oracle. Now go forth, be fruitful and multiply.
As always, thank you for reading and I invite your comments on this topic.
I may be wrong, but I think Sun didn't agree to IBM more because of what IBM as a company today is than because of the price it had offered. IBM has been getting into the services industry more and more, patenting about the right way to outsource even, and had sold off its ThinkPad part of the hardware industry too. Sun could've got the impression -- not incorrectly -- that IBM is bored/incapable of handling the product and hardware sides of Sun.
Thanks for your thoughts. It certainly is an interesting situation.
I think it's important to keep in mind that it was IBM, not Sun that broke off negotiations (albeit after Sun said that they would no longer abide by the exclusive negotiating agreement.)
It seems to me, however, that IBM wouldn't even consider purchasing Sun if they didn't want to get their hands onto Sun's hardware operations. You can't escape the fact that Sun is a hardware company (and also a software company). To buy Sun for everything but the hardware would be like buying a car for the cup-holders, tires and stereo. It doesn't make much sense.
In this New York Times article, the reasons why IBM pulled out are described in more detail. Obviously the per-share price wasn't the only factor (executive payments were a concern, supposedly) and as is often the case, these things can get a little personal (one source references an abundance of testosterone). High level executives are often driven more by personal than corporate ambition. As you can imagine, getting world-class competitive egos to hammer out a deal can be pretty fractious.
In the end, by most accounts, Oracle has strengthened their position on the software side and have now moved into the wild world of enterprise server hardware. It will be interesting to see how it all settles.
Thanks for the NY Times link. This is all very interesting and this is only the beginning. :)
No problem, and I totally agree. It has been (and surely will continue to be) an interesting situation. I can't help but be both uneasy and hopeful all at the same time. Will Oracle's reign lead to a renaissance or the beginning of the decline of Java? I can't wait to see how it plays out...