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Oracle acquisition could end uncertainty for Sun Microsystems, NZ partners say

Oracle acquisition could end uncertainty for Sun Microsystems, NZ partners say

Sun Microsystems’ local distributor Express Data and partner Eagle Technology say Oracle’s acquisition could give Sun a more positive outlook after doubts about its future.

Oracle’s acquisition followed a bid by IBM that failed to come to fruition.

The deal, which was made public on April 21, places Oracle into the hardware market and makes Sun the latest company to be subsumed by the Silicon Valley giant.

Representatives from both Sun and Oracle New Zealand declined to comment on the acquisition from a local perspective, however Express Data general manager of sales and marketing Paul Plester says from his company’s point of view, a time of uncertainty and confusion over Sun’s ownership has ended.

“It will be good for Sun, its partners and its reseller channel in New Zealand, which has had a pretty good run with Sun over the past couple of years. They are looking for Sun and Oracle to show a clear commitment to the channel.”

Plester says Express Data is now keen to move forward and hopes to be distributing Sun in New Zealand for a long time to come.

Eagle CEO Gary Langford says his firm’s initial reaction to the move is “reasonably positive”. “We have a strong relationship with Sun, being very keen for them to have a strong owner.”

“There has been speculation around Sun and it’s good that’s put to bed. They’ve got a great technology platform and it would be a shame if that disappeared because of speculation.”

The acquisition is a chance for Eagle to strengthen its relationship with Oracle, says Langford.

“Eagle doesn’t have a lot of touch points with Oracle, we sell hardware platforms for databases and we work with them in our GIS [geographic information systems] area. We’re looking forward to developing that relationship.”

Analysts also see the move as positive, with Ovum’s senior vice president of IT research David Mitchell saying Oracle has a consistent track record of delivering on expectations, when it comes to mergers and acquisitions.

“The Oracle integration team has certainly had a lot of experience in managing the integration of newly-acquired companies into the Oracle fold, having managed well over 40 of these in the past four years,” Mitchell says in a recent release. “Once the acquisition has closed customers, and the market in general, should expect to see the main element of the integration completed within the first 90 days. This will see answers to the main questions around product portfolio, sales and marketing organisation, customer support, etc… becoming clearer. Oracle has a track record of doing just that and we should not expect anything different with this acquisition.”

IDC A/NZ AP datacentre and enterprise servers research manager Matthew Oostveen says in a statement the acquisition is a “smart move” for Oracle as a merger of the two companies does provide synergies in the marketplace.

But he also says the company will need to reassure the channel of its place moving forward and educate partners on the new business’ dynamics.

“Oracle potentially stands to gain more from Sun’s software assets than IBM would have. Instead of competing with MySQL, Oracle will be able to offer its customer base a popular, well-recognised entry-level database and an upgrade path to Oracle’s enterprise products as customers’ needs scale.”

He also says the advantage for Oracle will be the capability to structure enterprise deals so the profitability is spread across databases, storage, middleware, servers and applications.

“Consequently, Oracle has the potential to theoretically out-manoeuvre IBM and SAP in pricing.”

Oostveen claims the market may soon be seeing Oracle applications and middleware running on Oracle Solaris installed on an Oracle server feeding Oracle storage.

But he also says the challenge for Oracle, with its focus on commercial software, will be evaluating the future revenue potential of Sun’s software offerings after Sun began open sourcing many of its innovations.

Oostveen adds the future of Sun’s systems practice is still unknown and will depend on whether Oracle is willing to invest and compete in a new market.

“Will Oracle invest in a future roadmap for the non-x86 SunSPARC CPUs and will the migration of Sun’s install base to x86 servers continue?”


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