Oracle Acquires Sun Microsystems: Software Synergies, Hardware Questions

I'm shocked. Oracle this morning announced plans to acquire Sun Microsystems for $7.4 billion. It's not a traditional managed services story. But the deal reorganizes the software landscape for managed service providers and VARs. And it also raises questions about what Oracle will do with all of that Sun hardware.

This deal is about value (Oracle acquiring Sun at a low multiple) and software synergies. The Sun Solaris/Oracle combo has been favored by thousands of businesses for more than  decade.

Of course, Solaris is a legacy name that's being eclipsed by Linux and Windows Server in many markets. But Sun's other software offerings -- Java, MySQL and lots of middleware -- fit nicely into the Oracle portfolio.

In some ways, the open source MySQL database was disrupting -- but not destroying -- Oracle's traditional database business. By acquiring Sun, Oracle has a much higher chance of dominating the present and future database markets -- whether customers want open source or closed source options.

There are also cloud computing and SaaS (software as a service) considerations. Cloud services (such as Amazon Web Services), co-location centers and Web hosting firms increasingly offer MySQL as a SaaS option in their environments.

Oracle: The New Hardware Giant

Still, I've got to wonder: What is Oracle going to do with all of that Sun hardware? Does Oracle really want to compete against IBM, Dell, Hewlett-Packard and Cisco Systems in the server and storage hardware businesses? That's the wild card.

Apparently, yes. In the official press release, Oracle and Sun wax poetic about Sun's SPARC and x64 systems. Personally, I wonder how successful Oracle will be in the hardware business. But I think Cisco's moves into servers made Larry Ellison start to wonder "why not us, too?"

MSPmentor is updated multiple times daily. Don’t miss a single post. Subscribe to our Enewsletter, RSS, Webcast and Twitter feeds.
TAGS: Financing
Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish