Thursday, November 12, 2009

Responding to the EU Objection to Oracle’s purchase of Sun

The past few days have been an exciting and interesting series of events. Recently the European Competition issued objections to the purchase of Sun by Oracle. Remember that this deal has already been approved by the US Competition Commission. So what’s the hold-up?

oraclesun

It appears that the EU feels that Oracle acquiring Sun will limit competition in the database marketplace. On the surface this seems like an valid observation based on market share alone. Consider that Oracle is the #1 database in enterprise environments and that MySQL is leading in smaller database environments. So that means that Oracle will be the #1 database vendor. Does it limit competition when you dominate the marketplace? Does it stop companies like IBM, Microsoft and others to develop and innovate in their own product stacks. The IOUG Board discussed our response and it was a consensus opinion that the acquisition of Sun and MySQL will not limit competition. Considering that we are the user group who focuses solely on Oracle database and middleware technology that we were well suited to respond in a meaningful way.

We feel that the delay is causing even more damage by adding a level of uncertainty to the company’s future and will impact profits and dollars. Considering that Oracle has purchased other databases in the past illustrates how well Oracle continues to support and innovate in these various DBs. Oracle purchased RDB years ago, and more recently TimesTen, Berkeley DB and Essbase, and each have been supported and extended. Oracle purchases products that help them in being leaders in both proprietary databases as well as open ones.

For me this is really a question about innovation and not competition. As we often say…”If you build a better mousetrap…”, and it is not different in this case. MySQL was created as an inexpensive alternative to the big databases. It was built by a private group named MySQL AB who felt that a small cheap and sometimes free database would be able to grab market in the competitive database field. Somehow they did capture marketshare from companies that felt they were untouchable. To go on and become the leader in many verticals especially on the web. So where is the next MySQL and how will step up and compete and how does this purchase stop it. Competition is driven by innovation, differentiation and market needs, and the IOUG feels that the EU objection is ungrounded.

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