Sun Tzu would have expected some kung-fu action out of Oracle by now! Consider this question, what do you think would happen if China suddenly switched to the Euro as the basis for settling all it's international debt? That one move would essentially turn the lights out on the US economy. If Bush and Taiwan piss off the mainland Chinese, they won't go to war with us, they'll take out our economy. Oracle has a similar advantage over IBM right now... But let's examine the outcome before we carpet bomb Armonk.
I have a lot of respect for the BMOC at KSQL as any fellow pilot is a brother. While I don't know the guy, most of the people I do know connected with him say he sort of a dick. However, his execution, engineering acumen, business savvy and sense of personal style can't be denied. Larry Ellison is a guy who gets things done. I have also met Safra Catz at various Bay Area political and charitable functions. She is also smart and competent, (and she's pretty hot, a good hire on all fronts) but I am distressed at Oracle's lack of action or direction in the Operating Systems space. Strategically – Oracle could change the face of the industry with a couple of brave acquisitions and take a chunk out the competition in one well timed move. It's high time to shake things up, because while the Financial Times article where Larry discussed getting into the Linux business was good for some yucks it's time to see the bullshit walk and the money talk.
Database software works better when you have a tightly tuned operating system. IBM is sticking it to Oracle with DB2 and a successful (yet vulnerable) Linux strategy. IBM makes it easy to choose DB2 on Linux reaping the rewards of folks who are simply worn out dealing with Windows (security issues, an OS that seems like a buggy tar pit) and see Linux as a viable platform with perceived performance and cost advantages. Microsoft is chasing IBM and Oracle with their modestly successful Microsoft SQL Server product, software that directly benefits from control of the OS and many speculate that MS has a number of stack specific versions of its OS products ready to hatch. Heck, even puny MYSQL just by virtue of it's existence is forcing Oracle (and IBM) to grant some pretty hefty price concessions to customers who use it simply as a way to bargain down their database spending. Either way – this is an expensive marketing battle in a mature market that apparently is being fought with no long term goal. Sure, you steal a couple of market share points here and there, but it's a never ending struggle. Let's see a Siebel / Peoplesoft style consolidation play on the Linux space and by virtue of that offer IBM a little payback for that wonderful DB2 billboard on Highway 101 at the Oracle exit.
I speak to a lot of senior IT deployment managers - It is this analysts observation that most enterprise customers would welcome a supported distribution by Oracle, whereas they would not welcome yet another OS offering from IBM (perhaps Linux/2). Interestingly, Oracle is already a shareholder / founder of Linux distribution company Miracle Linux, part of the Asianux kiretsu so there had already been some testing of the waters. It's also worth noting that the majority of IBM enterprise customers (more than 80%) running Linux on the mainframe are using Novell (SuSE) Linux and (almost) every one of these is also a big DB2 customer. Some marquee names, Deutche Bank, Korean Airlines, many Wall Street financial houses, these are companies that Oracle should be selling to but have traditionally been blue (IBM) shops. Cracking true-blue accounts is the bane of any sales executive surfing in IBM's wake. Oracle can crack these accounts with a killer OS strategy.
What should the strategy be? Here is my recommendation. Oracle should gain controlling interest of both Red Hat and Novell. Don't argue over which one to buy, buy them both, consolidate them, fire some people (I am happy to provide that list for a small fee), hire some other people (that list you get for free) but the net fallout is this. First, you have consolidated the business Linux space under one brand with the chops to get the job done and inspire confidence in the enterprise customer. Oracle is capable of putting at least as much muscle behind Linux support and services as Microsoft can muster for Windows. Oracle is also a much better brand that can do much more with the assets of both these companies than they would ever be able to do independently.
Shortly after the purchase Oracle discontinues support for DB2 on Oracle platforms, but will offer free migration tools and discounted support and license deals to shops that make the switch. Make it hard for people to use DB2, and take Red Hat out of the picture and you force IBM customers to run back to Microsoft as a place to run DB2 (which will never happen) or make a simple DB concession for the privilege of continuing to run a great operating system supported by a trusted provider. Novell brings a lot of great technology to the table, some of the best is directly targeted at Active Directory and other areas where Microsoft is strong. Oracle not only gains one of the better Linux platform development teams but they also pick up a bunch of supporting technologies that while Novell has been completely inept in capitalizing on you can almost guarantee that Oracle will know what to do.
Lastly, with the right marketing you now have Oracle customers demanding that IBM support Oracles OS on their mainframe products... Next step is closing the books on Sun – more on Jonathan's nightmare scenario after I get a steak, some wine – and hang out in Second Life for a while!
