Oracle and Sun – what will it mean for customers?

Looks like Ellison is going shopping again at bargain prices with Oracle‘s acquisition of Sun Microsystems. This could mean that Oracle is more in line with becoming a competitor to HP, even while touting a joint HP-Oracle Database Machine and Exadata Programmable Storage Server (only launched last year).

With Sun, Oracle will get more from the business relationships to sell into customers it already knows and expand into organizations where it may not have a current footprint. But how will that affect Sun customers? We think the pending acquisition will affect them in a big, big way. Through any M&A activities, it can be a big bonus for existing clients to renew contracts with value added services and bigger concessions. But there will be layoffs. Bernstein analyst Toni Sacconaghi estimates a loss of 5,500 to 10,000 jobs.

And, oy! What about the licensing? As seen with Hyperion, it was only a matter of time before its licensing practice and pricing was aligned with Oracle’s methodology.  Right now, Sun is extremely lenient (to the point of being lax) when it comes to audits.  The company seldom enforces compliance and Sun clients know it. As long as clients keep buying, Sun doesn’t audit.

Oracle, on the other hand, is very serious about its intellectual property and once Sun is part of Oracle, I would expect that there will be vendor audits for Sun customers.  Sun customers should be prepared!

We suggest current Sun customers do an internal audit, get help, and get things in order. Oracle takes compliance seriously. I’ve written a lot about Oracle and compliance issues — here are some previous posts that might be helpful in understanding Oracle’s mindset.

1-      Prepare for an Oracle Audit

2-      Compliance: The Foundation of Working with Oracle

3-     One-minute Oracle Licensing Tip: Modifications

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