Oracle buys what will happen to Sparc

Oracle is buying Sun for $7.4 billion a move which Oracle CEO Larry Ellision says, will give Oracle two key Sun software assets: Java and Solaris.  He says, “Java is one of the computer industry’s best-known brands and most widely deployed technologies, and it is the most important software Oracle has ever acquired.

Oracle Fusion Middleware, Oracle’s fastest growing business, is built on top of Sun’s Java language and software.

Oracle can now ensure continued innovation and investment in Java technology for the benefit of customers and the Java community.”

But what about all the other stuff: Oracle doesn’t need another Java application server; it doesn’t need MySQL and it certainly doesn’t need Sparc-based hardware, given that the whole world is moving wholesale to x86 commodity servers.

Oracle could use Sun servers to power its database applance, but it already has a relationship with HP for that.

Oracle is a software company now dabbling in hardware. Why? Maybe it wants to be like HP and IBM and build a cloud computing service for enterprise software.

$7.4 billion on Sun, doesn’t look good value, given that the hardware market is tough and margins are tight. Oracle spent over $8.0 billion on BEA in 2008 – now that made sense – buying the market leading web application server platform provider.

It would have been better for Oracle to spend the money on boosting Oracle Consulting.

It is possible that it will sell hardware as a loss leader – to ensure Oracle databases on Sun hadware are cheaper than Microsoft.SQL Server on x86 hardware. This is highly unlikely. Only time will tell what happens to Sun’s hardware division now that Ellison has control.

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A survey conducted by Citigroup amongst major institutional investors provided the following insight on todays markets:

The favored sector is Tech and this sector has held the top position over the last 12 months. Growth stocks are also a hot item of late, the market sees the economy in a more positive view for the second half of the year and this should bode well for growth stocks. An additional upside of 6% is expected from current market levels to the end of the year. The majority of this optimism is due to the market rally since March, investors believe the market has bottomed. Regardless of the expected drop (approximately 20%) in earnings this year, a common consensus is the rebound in 2010 will be in the double digits. I’m certain Oracle has this information in mind prior to its acquisition.

A grassroots opinion from a UK SaaS provider.

I would wholeheartedly agree with the optimism in the Tech sector, particularly in Software as a Service. As traditional markets are struggling, we're seeing month on month improvements, with businesses abandoning their old desktop software in droves. It would appear that despite the downturn, the businesses that are surviving are looking to benefit from the value and service that SaaS provides.

Liquid Accounts is delighted to be taking on the UK market and actually growing during the current climate.

Sun had no hope of survival by the late 1990s when McNeely Locked-in on selling "boxes" and stopped listening to the marketplace. Sun created huge value with Solaris and Java, but had no idea how to capture that value so it just kept doing what it always did. Eventually, the market didn't see the value in the boxes any more, and the value of Solaris and Java had been frittered away. A lesson for any company that it must adapt to market needs or it will be squashed. Read more at

Interesting times ahead to be sure. I wonder what IBM are going to do now, they must surely be feeling somewhat gutted by this pace of events.