DOJ Gives Oracle Approval To Buy Sun

k33l0r writes "The BBC is reporting that the US Justice Department has approved Oracle's takeover of Sun Microsystems. The acquisition gives Oracle control over (or a leading role in), among other things, Java, MySQL, (Open)Solaris, ZFS, OpenOffice, and the NetBeans IDE. 'The European Commission has still to rule on the deal, a step that will be required before it can close. That body has indicated it will issue an initial opinion on Sept. 3, according to the Wall Street Journal. It may OK the deal at that time or launch a four-month probe of it. ... The Justice Department ruling came earlier than expected, a possible response to Sun's declining revenues and precarious business position in a steep recession, as the required reviews proceeded.' We first discussed the deal back when it was announced in April."

Comments

Oracle and Sun combine and rename themeless as...

[jellomizer]

Apollo.

As far as mergers go this is probably a good fit. Oracle and Sun always needed each other for the most part. However I feel both are a dyeing breed. The industry wether you like it or not is moving away from those two companies core competencies.
High End Servers which are highly scalable with high end software which is highly scalable, is no longer the way it is now. We are moving to more smaller systems and don't need such scalability features as we realize that cost benefit really isn't there, for most situations.

What about Java

[yorkrj]

The only thing I'm concerned about regarding this deal is how this will change Java. The way I see it, one of two things will happen: One, current Oracle staff will manage the Java platform development and bad things will happen (all sorts of bad things could happen). Two, Oracle will deem Java an unprofitable product and will spin off a free software foundation, the likes of Mozilla or Apache.

Re:What about Java

[javacowboy]

Oracle's middleware business basically runs on Java. Why would they abandon it?

Re:What about Java

[MouseR]

Disclaimer: I work for Oracle.

When Oracle buys a company, they keep that company's staff to keep on working on whatever product they acquire. They dont shove that down the hall to whatever commando team. Based on personal observations of 4 companies that were absorbed and whose location merged in my area.

Also, as far as Java is concerned, Oracle has the best interest in keeping Java alive and well, as well as further push it. It's got a sizeable investment in Java for server-side stuff and even some client-side applications.

And from my perspective, all I can say is that more is to come.

Re:What about Java

[David Gerard]

Larry Ellison hates, hates, hates Microsoft.

1. OpenOffice.org advertised on television.
2. Java pushed everywhere .NET is now, with auto-conversion tools.
3. Ellison loudly and publicly calls Microsoft FUDsters re: Linux/OOo software patents and tells them to "bring it on".

Re:What about Java

[Eirenarch]

Do you really believe Ellison hates Microsoft? I do not believe at this level of business feelings matter. We've seen multiple times companies that fight a fierce fight in court over one thing to be first friends and combine efforts in another field. Basically these companies try to do whatever is more profitable to them. If Ellison judges that it is more profitable to make OOo interopable with MS Office and Java interopable with .NET this is what he will do. I can asure you that he is above simple Slashdot-like hate for Microsoft. That being said he may decide that the profitable thing is exactly what you said but somehow I doubt it.

Re:What about Java

[Zero__Kelvin]

"Oracle relies too much on java to give it away. Expect it to be forked, and then closed, with the previous open version left flapping in the wind."

If they could close it, which they can't since open, then they will be the only one using it. Java is used all over the place in Open Source, so the fork will be meaningless and the open version will continue and possibly pick up some highly skilled Open Source developer(s) that would otherwise have invested their efforts elsewhere.

Re:What about Java

[awpoopy]

...When Oracle buys a company, they keep that company's staff to keep on working on whatever product they acquire. They dont shove that down the hall to whatever commando team....

Tell that to the Virtual Iron Team

Reason for merger oversight: Java licensing

[javacowboy]

For those wondering why the merger wasn't simply rubber stamped, it has to do with the licensing of Java:

http://www.jroller.com/scolebourne/entry/no_java_7_us_doj

From what I read, it wasn't a *huge* deal, but enough of a concern that the DoJ had to work with Oracle instead of simply approving the merger right away.

The EU probably has similar concerns.

Re:Not sure if this is more funny or scary

[E-Lad]

Unfortunately said Pentium 4s also would fail 10x more often.

I don't know if you've worked (ie, have had direct administrative experience) with any of the larger Sun hardware such as E2900 and above, or even the Ex500's from back in the day, but if you did you'd also know that these servers have a knack for uptime and resiliency that x86 servers, even to this day, have never had. There was a reason for those higher costs.

Re:Oracle and Sun combine and rename themeless as.

[betterunixthanunix]

By "we" you must be referring to whatever market you are in. From my perspective, the amount of data being processed has increased and scalability is more necessary now than ever before. Large companies are increasingly involved in data mining and other large scale statistical analysis, and the need for computer systems that can perform those calculations in a timely is continuing to grow.

Re:Oracle and Sun combine and rename themeless as.

[jellomizer]

Data Mining and Business Intelligence doesn't need huge powerhouses anymore. A low end server can easily handle the Millions of records Databases now. The Mid Range can handle Billions. What is left for Oracle and Sun are the Trillions of records DB. Which most sectors don't use. Also with advances in distributed computing we rarely need to go high end for the Trillions of records.

Try Java, MySQL, VirtualBox, Solaris, OpenOffice

[syousef]

I have a few concerns.

Oracle does not have a tradition of giving away much of it's software. Sun by contrast has a lot of open source or free as in beer software. I am worried that Oracle will either kill or start charging for Java, OpenOffice, Solaris, VirtualBox, MySQL and other products based on it's own business interests. It's only natural for it to do so. With this aquisition, Oracle is in a position of great power. It can kill or alter the course of all the products of both companies. Absolute power corrupts.

For example MySQL and PostgressSQL are the only 2 viable open source alternatives to an Oracle DB for many systems. (There are critical systems for which Oracle is absolutely needed, but the percentage that could be served well by an open source alternative is probably significant). It is definitely in Oracle's interest to kill or dillute MySQL.

Bad deal for both companies

[Spazmania]

It's a bad deal for both companies.

The acquisition of Sparc and Solaris further estranges Oracle from Microsoft... Most of Oracle's revenues come from windows-based products and the Solaris portfolio isn't likely to change that. Likewise, they now become a competitor in Java vs. Dot-net. It isn't smart to step up from mere competitor to antagonist without gaining a massive new strength, and that didn't happen here.

Then there's Java. Drains quite a bit of cash without making enough money and Oracle as a company has the wrong temperment to maintain and improve a programming language anyway. Start charging enough to make money on Java and Java dies. Nor does having Java particularly complement Oracle's product line.

And mysql is a mess too. Improving it drains sales from their flagship database product... but failing to improve it causes a fork which loses Oracle whatever value owning Mysql had for them. Bad mojo all around.

The Sun/IBM deal would have been much smarter. IBM has a huge market for the likes of Sparc and Solaris. Better yet, they have demonstrated the wherewithal to take code they own and insert it into Linux. There's lots of stuff in Solaris to like, IBM is already weighing heavily on the side of Linux-based products and services and a well supported Linux on Sparc could save Sparc from oblivion and maybe even return it to being a growing market.

Meanwhile, IBM's database product (db2) never escaped its tiny niche. MySQL would be a great complement to their portfolio, moving them squarely into the mainstream database business.

Lastly, IBM actually has a need for Java given the breadth of hardware and OS platforms they sell. Write once run everywhere would be a huge benefit to IBM. It strongly complements the rest of what they sell, even if they never make a nickle off of it directly. Sadly, IBM can't rely on Java when it's controlled by a company as boorish as Oracle. It has to remain a minor player in their portfolio.

Re:Bad deal for both companies

[davecb]

My leaky memory says that 40% of Oracle's income (profit?) comes from Oracle on SPARC, and another 20% from Oracle on other Unix.

If IBM had bought Sun and phased out SPARC like they did Sequent, then they'd probably own 50% of Oracle's market.

It's far better for Oracle to buy their own hardware supplier than depend on others: the Sequent was highly optimized for Oracle performance, and then disappeared in a little puff of greasy smoke when IBM bought it and shut it down in favor of Power. That's got to have been painful!

As other commentators have pointed out, Oracle is heavily invested in Java, and sees MySQL as a "channel" that brings them customers. You note that Oracle invested in improving the performance of the transactional engine that MySQL uses instead of shutting it down...

I suspect Sun was a perfect fit: it complemented the things Oracle needed, and didn't have any important products that compete directly. Win-win.

That in turn could be good for me, as I'm a capacity planner & performance guy, working mostly on large systems, like the ones Oracle and Sun customers use.

--dave

Re:Bad deal for both companies

[treat]

My leaky memory says that 40% of Oracle's income (profit?) comes from Oracle on SPARC, and another 20% from
Oracle on other Unix.

I did the migration of the last Oracle Sparc to Oracle Linux system at my previous employer a couple years ago. Before this migration, it had moved to Fujitsu from Sun several years previous. (Oracle on Linux just wasn't there yet, a high-performance 8-CPU Intel machine monopolizing a whole SAN for performance reasons was full of race conditions because driver developers never had seen a machine or storage that powerful).

Sun just couldn't compete. For Sparc stuff, we would have needed a $5 million machine to outperform the $500k Fujitsu. The diminishing returns from the supposedly scalable Sun systems meant we had to skip two entire product lines. Unfortunately we couldn't test the next level up, and our experience with the E10K (64 CPUs underperforming 12) was that Sun machines don't always scale like this.

When we went to Intel hardware, we would have needed a $250k Sun machine and $250k SAN storage to perform comparably to a $50k Intel machine including internal storage.

We gave Sun a really good chance to compete each time, everyone involved had a strong personal attachment to making it work and had not yet accepted that Sun had failed as a business. We allways talk about that initial revelation that if Sun couldn't compete for our setup, they probably couldn't compete anywhere unless this is just a temporary gap in the product offering.

The Sun machines were the least reliable compared to the Fujitsu and Intel solutions. Random were weekly events on the Sun machines (e.g. [456]500s, E10Ks), every few months on the Fujitsu Primepower 850 machines, and hasn't happened ONCE after two years on the Intel machines. And I'm comparing it to a MUCH larger population of Intel machines (we added dev, qa for each of app groups, sysadmins, DBAs, "yesterday's data" for support people, added another server for performance, and then duplicated the entire 5-server setup when we took over another business unit's almost identical application.

Although I could say in theory I miss being able to identify and replace failed hardware components easily, the reality is that the HP servers identify the part that caused a crash with a fault light most of the time. Sun needed a case to be opened with them to explain a complicated error. This changes the hardware fix from under 5 minutes - a datacenter tech can do it himself - to hours at minimum, and days if their support screws you around.

Being able to do the hardware replacement faster also means no second downtime to do the actual fix. And the confidence level from a clear fault light is huge versus a vendor's first line support that is known for lying when decoding an error message based on what looked "obvious", not based on the real complexities involved.

Re:Not sure if this is more funny or scary

[davecb]

Actually the advantage is a fast backplane, not the memory. You may remember they bought the rights to the Cray asynchronous (really packet-switch-like) backplane quite a number of years ago, and have been expanding on it since.

It's easy to build a fast chip if it never has to maintain cache-consistency with anything off-chip. If it has to stay sane, even with only 64*4*2 = 512 threads banging on the same memory range, it not only takes an expensive bus, but it's also memory-transaction-rate limited.

That's why you read about transactional memory in Linux Weekly News: we all need it, SPARC and Intel both.

--dave

What is their target market?

[Anonymous Brave Guy]

Exactly. The need for databases has not gone away, but the upper bound for what you can do with cheap, commodity hardware and the likes of Postgres or MySQL is now higher than most projects will ever need. Numerous popular web sites run on a handful of well-specified but basically off-the-shelf PCs. Almost any in-house business admin application can be run this way, too.

I'd go further than the parent post, though, because I suspect it's just as bad at the other end of the spectrum now. Unless you're working for something like a bank, a government social security department, or a massive commercial outfit like Amazon, you probably don't need the high-end capabilities of software like Oracle any more. However, if you really are playing in that league, it's probably cheaper to buy lots of commodity PC parts and build your own cloud than to use expensive, high-end server kit from the likes of Sun. Likewise, if you're Google or Amazon, you have the resources to develop bespoke software tools to match your needs anyway (and if you're not quite Google or Amazon yet, you can lease resources from those who are).

It's hard to see how either Oracle or Sun has much of a top-end target market left for its traditional products. It would be interesting if they went for an aggressive mid-range offering though, aiming at providing a complete hardware and software platform for mid-large businesses that are fed up with Microsoft but don't want to outsource everything to the cloud either. Post-merger, they'll have a credible office suite, more database expertise than anyone else, lots of supporting back-end/middleware tools, and a programming language and client-side software platform that were tailor-made for remote deployment.

If it turns out that the market likes the benefits of centralised admin and remote deployment, but wants to keep control in-house rather than trusting (and paying ongoing fees for) third party services, then an Oracle/Sun combo that invested its resources smartly over the next couple of years should be able to compete very strongly. They might even be able to build a credible long-term business model based on support, consulting and customisation, rather than relying on relatively few sales of expensive hardware and DB licences.

Thought for the day: if this goes through, I'll be glad I don't have shares in SAP.

Re:Try Java, MySQL, VirtualBox, Solaris, OpenOffic

[Jim Hall]

Oracle does not have a tradition of giving away much of it's software. Sun by contrast has a lot of open source or free as in beer software. I am worried that Oracle will either kill or start charging for Java, OpenOffice, Solaris, VirtualBox, MySQL and other products based on it's own business interests. It's only natural for it to do so. With this aquisition, Oracle is in a position of great power. It can kill or alter the course of all the products of both companies. Absolute power corrupts.

Note: I do not work for Oracle, but we are a big customer of theirs. I have watched this very carefully, attended briefings (by Sun and by third party analysts.)

I am not concerned that Oracle will kill Java, OpenOffice, VirtualBox, MySQL. (I'm a little concerned about them selling off [Open]Solaris, since I don't see Oracle as an operating systems company.) However, I do expect to see a "pro" version of Java, OpenOffice, VirtualOffice, MySQL where Oracle forks the code into a stable branch, and companies can buy into a support contract for it. This isn't materially different from how OpenOffice/StarOffice are related now, or how Red Hat runs their business.

For example MySQL and PostgressSQL are the only 2 viable open source alternatives to an Oracle DB for many systems. (There are critical systems for which Oracle is absolutely needed, but the percentage that could be served well by an open source alternative is probably significant). It is definitely in Oracle's interest to kill or dillute MySQL.

I disagree that Oracle wants to kill or dilute MySQL. Quite the opposite, really. Oracle desperately wants to compete with SQL Server at the lower-end databases. Small companies and many mid-size companies feel that Oracle is much too complicated for them to run with [typically] a limited IT staff. Oracle has a lot of buttons, knobs, switches to tune performance (not to mention get things running.) As a result, SQL Server often gets deployed here. And for most internal-office workloads for small or mid-size companies, SQL Server works very well. So Oracle doesn't make money here. Oracle knows that lots of people can (and do) easily deploy MySQL, this is an easy "win" for them.

My $0.02