It looks like Sun hardware will remain in the Oracle family, for the time being at least, as the company wants to try its hand at integrated hardware/software platforms like the IBMs, HPs and now Cisco Systems of the world.
Larry Ellison gave the word this week that the Sun hardware division will not be sold off following the $7.4 billion acquisition, stating quite flatly: "We are definitely not going to exit the hardware business." Ellison added that the company will continue to develop the SPARC processor as well. Apparently, Ellison sees the difference between two halves and one whole, signaling that a combined hardware/software platform will be of more value to enterprises than the straight hardware or software strategies of, say Microsoft or Dell. Even if the margins on hardware are relatively small compared to software, it will certainly save customers a lot of time and aggravation by delivering an entire platform rather than just one piece.
Of course, as Savio Rodrigues notes on InfoWorld, that's not necessarily great news for system integrators who have made a comfortable living by setting up Oracle databases on Sun platforms. Now that Oracle will be handling that itself, the action is likely to shift to making sure Linux plays nice on Intel or AMD machines.
But as Danny O'Brien points out in the Irish Times, Oracle's main problem is that both its hardware and software platforms have been losing ground to lower-cost competitors: commodity Intel/Windows machines for the SPARC/Solaris servers and Microsoft SQL and the various open source versions for Oracle databases. Oracle's best hope, then, is to leverage all of its recent acquisitions to cherry-pick broad-based solutions from not only Sun and BEA, but industry-specific ones from Skywire and mValent.
It's also important to remember that integrated platforms may get your foot in the door but it's actual products and services that really close the deal. Oracle recently launched the Beehive collaboration platform aimed at merging wiki-based collaboration with the microblogging craze spawned by Twitter, with Web-based support for Office documents thrown in as a means to tear away Exchange users. The bet is that enterprises will want to combine traditional e-mail with group workspaces and other collaboration tools on common databases and middleware. It may work, it may not, but at least it's the kind of thing Oracle will have to continue to focus on if it hopes to gain support for its larger datacenter platforms.
No matter how you look at it, though, the fact remains that a Sun/Oracle combination still spells "high-end technology." There's nothing wrong with that, of course, but it's also true that the vast majority of users need both innovation and low costs. If Oracle were to start devoting its energies to countering the inroads that commodity hardware and open software have made into the broad middle spectrum of the enterprise market, well then we'd have a real horse race on our hands.