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US Gov't Lobbied EU To Approve Oracle-Sun Merger
littlekorea writes "Cables leaked by Wikileaks have revealed that the U.S. Government actively pressured the EU Competition Commissioner to approve Oracle's acquisition of Sun Microsystems. The cable reveals that the U.S. went to great lengths to discover how the competition commissioner felt about the 'pro-competitive' nature of open source software and whether this would represent a threat to the US$7.4 billion deal."
Why should the EU decide this on their own? It's better that the Worlds Remaining Superpower (tm) be there to ensure they make the right decision. And it's Oracle. What could possibly go wrong?
By the people, for the people!
Help I am stuck in a signature factory!
Weren't Oracle and Sun both U.S. companies? Why does the E.U. get a say whether one buys the other?
I think the astroturfers feigning concern about human beings with regard to these leaks are more concerned that their corporate puppeteers might look bad.
what would happen if they said no? At a guess the EU subsidiaries of each company could not merge but the US ones could. In practice this would mean that the EU subsidiaries would probably have to separate from the combined company, probably with rights to patents and copyright for their previous products in the EU. This would be a mess for everyone, the EU left with subsidiaries with rights that have no future development, and the USA base having rights outside the EU, being able to develop, but losing EU revenues.
Lobbying isn't that bad. USA officials had arrived to one conclusion, felt that the issue was very important to them and communicated that to EU officials. Regular co-operative communication between officials of two political bodies. If EU officials then arrived to a result which (considering all things, including any political capital gained or lost) was bad for us as EU citizens, then our own officials are to blame. Personally, I don't think that they did and there is nothing in TFA that implies otherwise.
In other words, the cables show that EU and USA officials of corresponding organizations actually communicate with each other when handling international issues. Nothing to see here.
This certainly is an improvement on the free market paradigm most large companies try to shove down your throat.
Not only does the government stay out of your way, it gets other governments to support you.
The land of the free...
I'm reminded of some dialog in Con Air:
Big Bad: "What exactly are we discussing here?"
The Dragon: "Hillbilly here don't want me to off the pigs"
Big Bad: "Nathan's [dragon] feelings about the police are understandable, and my own proclivities are well known. I'm interested in why you have an opinion at all?"
I'm curious about what national interest was served by continuing the merger or discouraging it's continued seperation?
A country debates with another country to preserve it's interests.
Has Wikileaks released anything really informative?
Here are their big leaks.
1. The military during war isn't always the most upstanding group of people and wrong people get killed, and the government doesn't like to tell you that. Duh ask any veteran they will tell you the same thing.
2. Diplomats and leaders are a bunch of selfish pompous hypocritical jerks. They are still human. And they are humans with extra power, so yea. If you didn't know that you must live in a land with unicorns and flowers.
All Wikipedia is an anti-cheerleader for the US and it's allies. Digging up all the dirt and none of the good stuf, granted countries usually keep the good stuff public, but the population doesn't always get it.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
There ought to be one. For the same reason as separation of state & church.
As an American citizen, and not a corporation (because corporations are citizens, according to the Supreme Court), or somebody earning the top 2% of income in this country, I have to say that this is god-damned infuriating. Anyone with half a brain knows that merger never should have happened, and that my government would so blatantly support the merger as to lobby another sovereign collection of nations (not even a single nation) to do the same is the absolute antithesis of what REAL free-market capitalism is all about:
Competition.
What we have in modern day America is not free market capitalism. It's an abomination where the corporate sphere of influence literally owns governmental initiatives, and our government has either sold their testicles, or never had them to begin with, and therefore lacks the courage to stand up and do anything about it.
I fear for the future.
"What is the EU going to do if they merge in the US, prevent the new merged company from doing any business in the EU?"
DOH! Yes; Precisely that.
Isolationism does not just mean saying 'Fuck You' to your neighbors; It also means they shrug and say 'Fuck You Too' right back.
"Oops, I always forget the purpose of competition is to divide people into winners and losers." - Hobbes
What is the EU going to do if they merge in the US, prevent the new merged company from doing any business in the EU?
Damn right! That's the EU's decision on how companies can do business on their soil. I sure as hell wouldn't accept an EU company dictating to the United States how they're going to do things, and the EU shouldn't either.
It is one thing to obey the laws of a country you do business in, but another have to company decisions be influenced by the whims of a country separate from where your company is headquartered and based.
That might make sense if Oracle wasn't an international company, but they are. It was up to Oracle whether or not to buy Sun, and if the EU wanted to deny that, well I've got two words for Oracle: Tough Shit.
Yes, that is exactly the threat that is implicitly being made - that of blocking the merged company from being able to do business within the EU.
To do so would be purely an internal EU matter. It would not violate any company's ability to do whatever they like in the US.
US companies would be insane to ignore it, because the EU is a larger market than the US.
I don't know why this is new to some people. Big money has ways to nudge people in the right direction. In any case I don't think that this was the "straw that broke the camel's back".
Some people read this sort of headline and think it's all down to the decision of one person or that somehow the US dictates what the EU does. It does not take a rocket scientist to understand that sometimes, some countries that have negotiating leverage actually use it. So what is the article trying to inform us about?
At the end of the day is this even worthy of an article? most of these so called leaks are worthless. You can guess as much by common sense. The only thing the leak actually gives us is a confirmation that the typical behind the scenes action we often assume is taking place is actually occurring.
This sort of thing is exactly what diplomats do. They lobby other countries to take actions perceived as favorable for their own country. There is no evidence here of threats, extortion, or arm twisting. Just diplomacy.
Nothing to see here, move along.
What America needs now is an old dude to assume the role of high church office so that America can officially become a religious state. They can then live off the proceeds offered by the superstitious tourists.
I mean when you have a great Empire that implodes on itself after having succumbed to military spending insanity, what's left to do when everything goes to shit?
The dangers of knowledge trigger emotional distress in human beings.
and its working LOL thats why 40% still use xp....
The US government has long been a tool designed to serve the needs of large corporations. This does nothing to change that.
We the people lost our country when the US government, along with Britian, decided to invade Iran and depose the lawfully elected leader of that country (Mohammad Mosaddegh) so that BP could come in and pillage their oil fields.
personally, I wish Apple had bought Sun. Sun had a reputation for somewhat overpriced but high quality hardware, with nothing in the consumer space at all. Apple's server hardware sucked. Sun's OS is an antique whereas OSX is up to date.
So they would have been a good fit, and at least Apple might have nurtured OpenOffice and MySQL, and as not quite as greedy and evil as Oracle.
The companies are based in the US, so the EU ultimately does not have that much say.
If you ignore ACs because they are anonymous - you're an idiot.
This sort of thing is exactly what diplomats do. They lobby other countries to take actions perceived as favorable for their own country. There is no evidence here of threats, extortion, or arm twisting. Just diplomacy.
Nothing to see here, move along.
We're not talking about a country here: this is a corporation. A very large corporation.
WTF is our Federal Government doing acting as a advocate for a corporation? Can't Oracle handle this on their own? They can't spend then money on EU lawyers and lobbyists and sway the Competition Commissioner?
Here I am broke as fucking hell and our Federal Government is acting like an errand boy for a very large corporation controlled by a billionaire at the taxpayer's expense.
Taxpayer's expense
See that Tea Party People!
Read the article. It says it was the Obama administration.
Lobbying is a type of corruption. It can be legal in USA, but is a type of corruption that is not legal everywhere.
-Woof woof woof!
Mars orbits the Sun too. Do the Martians get a say?
Well, Oracle is of course allowed to stop doing business in the EU if they do not like the rules there.
It might make some people (like you) and even some of their shareholders happy. But allow me to show you some numbers.
Oracle's fiscal 2011 income:
Total income: 35,622 million dollars
Americas (North and South): 18,352 million dollars
Europe, Middle East & Africa: 11,497 million dollars
Realistically most of the EMEA income is from the EU, just like most of the Americas income is from the US.
What you're suggesting is that they dump 32% of their revenue from day to day.
Some of that will be offset by laying off 22,394 employees in the EMEA, but that only makes up 20% of their total number of employees. Compare that to the 45,887 employees in the Americas.
The EMEA is a more profitable area for Oracle than the Americas from a pure income/employee point of view (514,000 vs 400,000 dollars)
But if we ignore the financial consequences, the competitive consequences of giving your main rivals 11 billion dollars a year and the sheer idiocy of believing that you shouldn't have to live up to the rules of the countries you operate in, then yeah - you have a really good idea there.
Go for it - I'm sure you'll have a lot of success at Oracle's next shareholders meeting.
I'm not suggesting that at all. I'm suggesting that if Oracle and Sun merged in the US and elsewhere in the world, I don't see how the EU can prevent it. Oracle and Sun can be separate entities within the EU, and merged within the US. If not, why not?
If you ignore ACs because they are anonymous - you're an idiot.
It's not as simple as that. Most of the development for eg MySQL is done in Europe, and the resulting product is sold all over the world. The reverse is true for some of their other products. Development costs would be the same if they lost the European market. Since some of the products are owned by European subsidiaries they have bought over the years, they might end up losing them completely. They provide 24/7 access to tech support by having offices in different time zones, so if someone wants help in doing an out of hours job on their system, they will most likely be speaking to someone in a different country.
Yea, and us old-hat Solaris Admins are left to mire in the bog that is now Oracle/Sun post-merger with many of our clients sick of their new [lack of] support so much so that we now have to port entire data centers over to RedHat and realize that all those years of Solaris experience on our resume will soon mean nothing... Thanks USA/Oracle!!!!
Larger market in what sense? You can keep deluding yourself into believing that the EU is a larger market, but in most cases it is not.
For example, only 15% of Oracles revenue comes from the EU (http://seekingalpha.com/article/173186-why-oracle-should-leave-europe-a-look-at-the-numbers), and Sun has more sales in the US than the EU (http://seekingalpha.com/article/173186-why-oracle-should-leave-europe-a-look-at-the-numbers).
I always wonder what is meant when news stories write that some government official "pressured" another government's official. This part that is edited out or never pursued is quite important to understand what really happened.
One government making a request of another is illegal in some places? Where exactly is this the case? What do non-consular diplomats DO all day in those countries?
It's funny that of the top three comments I see two almost robotically-identical opinions that there's nothing to see here, please move along.
Almost as if you're being paid to downplay this issue. The merger of two large companies is almost always accompanied by job losses in the industry. No, check that, I dare you to find ONE instance of a merger on this scale that didn't lead to widespread job destruction. It wasn't in the USA's best interest to let this merger go through -- it was in ORACLE'S best interests. So the lobbying between nations -- no that's not the problem if you are so wilfully ignorant and submissive that you allow the problem to be framed that way. No, it isn't.
The problem is that ORACLE had some contact high up in the US government who were willing to grease the wheels on this merger. I submit that if the economic impact of this merger were truly lined out, it would come up as a dead loss for the US' GDP. The same is true for such megamergers as the proposed AT&T/TMobile merger, or NBC/Comcast. Jobs will be destroyed. Customer choices will be reduced. Prices WILL NOT GO DOWN. And quality of product/service WILL. So obviously the real story here is the undue influence of large companies on the government.
There is so fucking much to see here it is almost blinding. Unless you're a willing tool of the corporatocracy.
One day I feel I'm ahead of the wheel / the next it's rolling over me / I can get back on / I can get back on
This is about the government trying to keep Sun from going bankrupt and thousands of people loosing their jobs. How is this a bad thing?
Having to work for a living is the root of all evil.
For that to work, you'd need to split both Oracle and Sun into separate companies in the EU (i.e. Oracle EU and Oracle Global) and in such a fashion that they aren't just shell corporations (and legislators tend to really antsy when you set up shell corporations to try to weasel your way out of things you don't want).
And if you do that, you'd inevitably end up in situations where Oracle World and Oracle EU are bidding on the same contracts, making them compete against each other. I'm pretty sure that'd be a worse situation.
Why do you think so? The government should protect the people/economy/etc. by preventing undesirable outcomes (monopolies, anti-competitive practices, etc.) and advocating desirable outcomes (job-growth, etc.). If they determine that the merger going through is not negative, they don't need to prevent it. If they determine that it's positive, they can advocate it. I don't see any conflict there.
You are a retarded and utterly moronic idiot.
Sun was bankrupt. If no one had purchased the company, a heck of a lot more jobs would have been lost (read: all of them).
8 straight (not "strait") quarters of GDP growth does not begin to compensate for 8 straight years of ZERO job growth.
One day I feel I'm ahead of the wheel / the next it's rolling over me / I can get back on / I can get back on
1) Not everyone who disagrees with you is a crook hired by evil corporations. You could write your posts without filling them without paranoid name calling.
2) Whether mergers result in immediate job creation or destruction is irrelevant. What matters is the long-term effect for the society/industry/economy/people.
So, when we strip your post of all the hostile attitude, childish name calling, etc. what we have is this: "I don't think that the long-term effect of the merger is positive so the government maybe shouldn't have let it pass and certainly shouldn't have lobbied for it! I bet that the USA officials worked for the Oracle shareholders, not for us as the people...". That's a valid opinion and you could build up from that. I might not agree with it but we could perhaps discuss the matter like adults.
The companies are based in the US, so the EU ultimately does not have that much say.
EU has the say - it can refuse to recognize Sun and Oracle as two separate entities if they're factually a single corporation in US (this does not in any way relate to EU jurisdiction - it doesn't have to limit itself to matters of fact that are only available on EU soil), and then refuse that entity the right to do business in EU so long as it is non-complying with the regulations.
The United States was founded by corporations. The declaration of independence was done because Britain wanted to eliminate (some) tax breaks for big corps. It's no wonder the corps chose a form of government that would champion their interests (and it has).
Doubtful. SGI was in worse shape for much longer and got through 2 bankruptcies before being bought ( cheaply ) by Rackable Systems which has since rebranded itself as SGI. They would have had to slash staff but they had plenty of valuable tech and still a few really big customers.
Pain is merely failure leaving the body
Dear U.S. Government,
Why didn't you bail out Sun if you were so very concerned about its future? Lobbying for Oracle to take over Sun was like paying for the meanest, most ruthless fox to guard one of your most useful hens because she was sick. Meanwhile, you gave handouts to every big financial or automotive company that caused horrible problems and whined when they got burned by their own mess.
Get fucked.