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Sun Microsystems To Cut 3,000 Jobs As Oracle Deal Drags On
afgun writes with news that Sun will be shedding 3,000 jobs, roughly 10% of their workforce, as they continue to lose money while waiting for EC regulators to approve their acquisition by Oracle. "Oracle Chief Executive Officer Larry Ellison said Sept. 22 that Sun is losing about $100 million a month as the transaction is delayed by the EU probe." James Staten, an analyst with Forrester, said, "The longer a cloud of uncertainty hangs over Sun, that drives customers into delays of purchases or into the hands of competitors. This is a very trying time for Sun and Oracle as they wait for an answer." A spokesman for EU Competition Comissioner Neelie Kroes said today that she "expressed her disappointment that Oracle failed to produce, despite repeated requests, either hard evidence that there were no competition problems or a proposal for a remedy to the competition concerns identified by the commission," and that "a rapid solution lies in Oracle's hands."
So all the fuss is over mysql? which is free? How can there be a monoply on something free
Apple will be able to cherry pick the top engineers from Sun and continue its relentless assault on every other version of Unix (and suck unix-alikes like Linux). GO APPLE!
Why does Europe get to hold up a purchase of an American company by an American company? Or is that not the case?
Why is it not about Java also? MySQL is big but Java is bigger.
To prevent a large monopoly from forming around a certain product, service or market? Seems like a good enough reason to me. Monopolies only benefit themselves (the companies that create them) and not consumers. In the EU, at least the government still cares about protecting the consumer. In the US, the companies run the show and the politicians.
The unfortunate situation in this case is that the probe is using a "guilty until proven innocent" approach of things, thus causing 3K people losing their jobs. Where is the actual, sufficiently reasonable evidence that this merger will result in a monopoly? What other industries will get affected by it? IBM? MS? Large DB software writers? Server manufacturers? MySQL? Who are these potential consumers that must be protected by this evil merge of doom?
This shredding of 3K employees, probably translate to 3K households being affected, in an already affected job market. These are also white collar or almost-white collar workers who, as consumers to other services, will have to cut their spending. And that trickles down to blue collar jobs (in particular in the service sector), possibly affecting several other thousand households (not to mention the impact on the local economies where the bulk of the job shredding take place.) In market economy whether is in either side of the Atlantic, the less that white collar employees spend in their local economies, the more that it affects those that are under a lower income bracket.
So much for protecting the consumer. I agree that monopolies must be stamped out, but this is ridiculous.
Did the US regulators have similar concerns? If not, why not? If they're genuine concerns - they sound like it - why is it just the EU that's following them up?
There generally seems to be a certain amount of frustration that the EU is holding up companies of US origin, although actually they have significant financial impact (and offices and presumably regional headquarters and subsidiary companies) in Europe too. Presumably Oracle and Sun *themselves* could have predicted these hurdles if they'd done their homework - is it really that outlandish to expect that merging two leading (albeit in different markets!) database companies would be a worry for the regulators?
I was wondering this too. What I've seen so far of Neelie Kroes in the last couple of years, she's been very fair, and quick to act if she could. It's only when companies are dragging their feet and fail to reply to the raised concerns that get raised. And she might have given some big fines to US companies, the biggest and most fines have still been applied against EU companies.
And given that Oracle is acquiring MySQL with this merger, I think the EU certainly has a point, the only other sizeable players remaining are PosGreSQL and Microsoft. Basically you end up with a market that looks similar to the OS market with Linux and OSX as competitors to Windows, and for the OS market I think Windows has been ruled a (near) monopoly on both sides of the Atlantic. I think the EU is well within its rights if it wants to prevent the situation that the current OS market is in.
RogerWilco the Adventurous Janitor
Larry doesn't mind; the EU delay gives him a scapegoat for the layoffs.
Those of you fixated on MySQL: Sun sells hardware, software licenses and contract support to enterprises that use SQL Server, DB2, SAP and other direct competitors of Oracle, meaning the some DB2 users (for instance) will find themselves relying on Oracle for support of certified DB2 platforms... MySQL may be the least of whatever "competition problems" the EU has in mind
Lurking at the bottom of the gravity well, getting old
Not quite. In the U.S. the primary concern of anti-trust review for mergers and acquisitions is if it benefits or harms the consumer. In the EU, the primary concern is if the merger adversely impacts competition in the market. The failed acquisition of Honeywell by GE was blocked by the EU after being approved by the U.S. The U.S. review stated that bundling of avionics and engines, with some oversight of aircraft leasing by GE would reduce costs for aircraft and, as such, would not harm the consumer. The EU ruled that the merger would provide GE an unfair advantage against European jet engine manufacturers and blocked it.
What do these companies do with all of these employees? They had 30K and can cut 3K at the drop of a hat? Adobe has about 7K, Google 20K, Apple 32K, Microsoft 91K and IBM nearly 400K!! What do all of these people do? By way of comparison, Harvard has 13K and GM had about 245K. How many TPS reports do 10K employees generate?
What the EU has been driving at is the assimilation of MySQL by Oracle.
Even as a Postgres user I'm willing to admit that MySQL is used in a much larger number of databases.
So the issue isn't that there is an alternative, it's that a significant number of people are using MySQL in production environments.
And believe it or not the EU considers that there is a serious amount of momentum for the end user if they are already using MySQL.
The concern they have is that MySQL would be abandoned by Oracle. Leaving a large number of people with concerns about what they are going to do for support.
If Oracle would spin MySQL or seperate MySQL from the deal, this thing would be over in a couple of days.
Currently what Oracle and Sun are saying is, if you don't let us have MySQL we are going to start laying people off and it's your fault.
. So now they are playing a game of chicken.
The only problem is that the EU usually takes into account these type of tactics and realizes that no matter what happens a large number of people are going to lose their jobs.
Here in the US congress would be crying about the job loss we were creating by not letting the deal go through.
I'm becoming a little more impressed with the EU's dealing with these types of issues. They seem to be a lot more business savvy compared to the counterparts in the US.
Exactly right. Chances are Ellison is loving this since he can blame the carnage on the EU, he gets SUN to take all the charges for the layoffs, and he gets rid of people he would have fired the day after the merger closed anyway. Only interesting question is if Schwartz and SUN decided who got canned or if Ellison and Oracle are deciding. Chance are SUN at least consulted with Oracle on who got the ax.
@de_machina
I don't suppose it has anything to do with Oracle owning Peoplesoft, which competes directly with SAP (a European company)?
Where I work we could lose 1/2 our staff and nothing would be lost. And by their standards, we are "staff lean".
So rather than satisfy the queries of the EU, Oracle would rather whine and blame the EU for the razor gang they have every intention of letting loose on the Sun employees anyway.
"Monopolies only benefit themselves (the companies that create them) and not consumers"
Well, we can debate if the fruit of monopolies has benefited consumers:
Xerox:
Ethernet
Press->Interpress leading to Postcript at Adobe
Laser Printers
Graphical User Interface
AT&T:
C and C++
UNIX
Laser
Transistor
IBM:
FORTRAN
DES
Fractal Science
Magnetic Disks
DRAM
Erm, she is called Neelie Kroes.
Nancy is Neelie's hotter evil twin sister.
If you work for Opel in Germany (or sit on Magna's board) I don't think you'll be believing it is possible for someone like her to have an evil twin...
"Little does he know, but there is no 'I' in 'Idiot'!"
Namedropping will not make them corporate standard. The companies that I've worked within and their affiliates almost always use MySQL or Oracle, except a few Access and SQLite exceptions.
I am the lawn!
Anecdote dropping won't make MySQL or Oracle the corporate standard either. They are popular in some places, and certain types of apps, but far from 'standard'.
I see more developers in enterprises building applications that run against Microsoft SQL Server than OracleDB.
The fact of the matter is there aren't large-scale open source CRM, HR, accounting, and other products that are suitable for meeting large enterprises needs.
Almost always Enterprises buy in closed source apps. Typically the apps use SAPDB, IBM DB2, MS SQL, or Oracle.
Very few enterprise apps, in fact support open source DBMs.
However, I can think of some examples off hand: OpenNMS, which is a network infrastructure monitoring app designed specifically for enterprises, is widely used, and even won SourceForge community choice award in 2008, for the category of Enterprise Applications.
And guess what, it supports only PostgreSQL.
Oh yeah... and Firebird SQL won in the category of Enterprise Apps in 2009.
Strange that MySQL wasn't even nominated (eh?)
I am not suggesting MySQL is not popular. Only that "MySQL + Oracle" is not 100% of the market, and it's not even close to 100%.
Ask any head hunter how easy it is to poach people from Sun - NOT.
I know people that work both at Sun and at Apple and I can quite confidently say that there would be some cultural mismatches.
There are a lot of talented people still at Sun because they enjoy being at Sun, despite the rocky ride that has been the last n years and despite the numerous approaches from head hunters. People I've spoken to have said they'd want more than a 15% increase in salary if required to jump ship because the value of the Sun culture and workplace environment.
Can you spend 2 months telecommuting from interstate because you want to spend time with your mother before she dies? How do you put a value on that? Some bay area companies (hint: VMWare) do not allow any telecommuting.