In a move that could transform the IT industry, Oracle on Wednesday announced it has finalized its $7.4 billion acquisition of Sun Microsystems. Oracle held an all-day event to offer more details on its plans, which include delivering open and integrated systems where all pieces fit and work together out of the box.
Oracle’s initial plans are to invest in Sun’s hardware business, which includes adding 2,000 new sales and engineering professionals. The other side of the labor coin is that Oracle will lay off less than 2,000 of Sun’s 27,596 employees over the next few months. Long-term layoff plans have not bee revealed.
Oracle will focus on UltraSPARC Solaris-based servers, along with storage and networking products and clustered offerings around Intel and AMD x64 solutions. Oracle also plans to continue supporting existing Sun product lines.
“Given their 20-plus-year history and numerous shared customers, surely Oracle ‘gets’ Sun’s technologies and company culture in ways that other vendors cannot. Right? Maybe and maybe not,” said Charles King, principal analyst at Pund-IT. “On the plus side, the pair’s long, close association should aid their integration and help drive new and future synergies and product development. In other words, the pairing looks good technologically.”
A Challenging Marriage
Despite the plus side, King said truly merging Oracle and Sun will have its share of challenges. For starters, there are sharp differences between the software and hardware businesses. Oracle has never demonstrated much understanding of the hardware business, King said, and a successful merger will depend on experienced people who not only have that understanding but who can also navigate the personnel issues on the Sun side.
There’s also the challenge of Sun customers thinking UltraSPARC is on a short road to nowhere. In the short term, King said, falling faith in Sun hardware would impact
Oracle’s bottom line — not to…
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