Ballmer, IBM Surprised By Oracle-Sun Deal 324
Geon Lasli writes "Reporters caught up with Microsoft CEO Steve Ballmer in Moscow to get his take on Oracle's deal to buy Sun Microsystems for US$7.4 billion. Ballmer was at a loss for words: 'I need to think about it. I am very surprised.'
According to a source, IBM hadn't given up on purchasing Sun and was blindsided by Oracle's move. I guess IBM must be regretting playing tough 2 weeks ago. Unknown to outsiders, Sun had probably found the Oracle lifeboat before they decided to pull the plug on the deal."
IBM plays hardball? (Score:5, Insightful)
Surprise! (Score:2, Insightful)
I hope that the news about the losses of jobs in Sun will not be confirmed and that Oracle get the transition right.
On the other hand, big blue are knocking with their heads in the wall because if they didn't have given up on Sun's buyout they probably will have a great share in the server's market and the application servers, another thing is that they will have to review their strategy towards JAVA cause now it's like they are fuelling Oracle more and more.
Let's wait and see the next months will be interesting but as a JAVA developer i hope that Oracle get it right in the end.
Re:I still can't believe it... (Score:3, Insightful)
What monopoly in the DB market? Oracle has Oracle and MySQL (from SUN). But DB2/AIX (and Linux/Windows/other) is a good contender. CA still has Ingress and Datacom. OK, that's a bit player. And there is always the love of my life: PostgreSQL. Oh, and MS SQL Server for those who don't really need a mission critical RDMS.
Re:counter offer? (Score:5, Insightful)
If they feel the company is worth more than Oracle are paying, they could make a counter offer. Indeed, Sun's board may have announced the agreement in the very hope this happens.
Equally, in those circumstances Oracle could increase their offer. Unless IBM are very keen on the acquisition, it's unlikely they'll want to enter a bidding war.
Not to say they won't have a final stab, especially if Sun is worth more to them now they know the alternative is for Oracle to own Java.
Re:Total Package from Oracle and Why MS Didn't Bit (Score:5, Insightful)
They didn't bid because Microsoft and Sun would be in antitrust hell forever.
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Re:No, more like setup man.. (Score:3, Insightful)
It will probably be just like every other merger of companies that should fit well together... it won't.
Oracle has been buying up a lot of companies recently. The general consensus [cio.com] seems to be that they've had a good merger and acquisition strategy and that they have pulled them all off well.
I'd rather it was IBM... (Score:3, Insightful)
JRockit, the old BEA product that was (is?) the best server-side JVM is difficult if not impossible to download individually now that Oracle owns BEA. Are we going to have the same issues trying to download the sun JVMs? Is the newly open-sourced JVM going to become closed source again?
How about the impact to the various Java committees, etc? Will hostility towards Oracle negatively impact them? Oracle obviously has it's own goals for Java and J2EE (to make things easier for them), but how will these goals conflict with the goals of the other community members?
I think that while it might have been a good purchase for Oracle that it will probably be a negative move as seen by the Java community...
Several months ago? (Score:5, Insightful)
Months ago? Lots of analysts? Hmmm. I think maybe it's easier to "foresee" this type of stuff in hindsight.
Not to toot my own horn, but I predicted Oracle would buy Sun [infoworld.com] before the deal was announced -- but I didn't do it months ago. I didn't hear anyone else talking about it months ago, either. And when I made the prediction, the consensus here on Slashdot [slashdot.org] seemed to be that it was a terrible idea. So if you can point to some references from months ago I'd love to see them. I don't think anybody was really even thinking much about Oracle/Sun before the talks with IBM made the news -- I know I wasn't -- especially considering that Sun had consistently maintained that it was doing fine and didn't need any help from anybody.
So it doesn't completely surprise me that Ballmer didn't see this coming -- though maybe he's not as shocked as he's pretending to be. By acting surprised, he makes it sound like he wouldn't have made this deal himself, which makes it sound like he might not think the deal is a good idea, which is a totally self-serving position for Microsoft to take.
It does seem a little strange that IBM is acting surprised, though. By all accounts they had exclusive rights to negotiate with Sun for a set period of time, and they let that period elapse. What did they expect? Maybe they didn't believe Sun would be able to leave the table and arrive at a firm deal with a different suitor so quickly, but that seems a little foolish on their part, if it's true.
Re:I still can't believe it... (Score:4, Insightful)
I said to my wife-to-be (yes, true, I have a fiancee; I'm an atypical nerd that has managed to develop a few social skills)
Maybe you or your colleagues are just young. Every developer I know has a wife, girlfriend, or family.
Re:I still can't believe it... (Score:5, Insightful)
I didn't see it coming, but I'm a bit dissapointed with myself for that.
In hindsight, it's the obvious choice.
Who is Oracle's biggest Competitor? IBM.
What is Oracle lacking when it goes head to head with IBM? Hardware.
When a customer says "we're going with IBM because they can deliver a whole solution" Oracle can now say "So can we!".
agreed except for (Score:5, Insightful)
This statement:
Perhaps you didn't mean to compare DB2 to MySQL, but saying MySQL would serve the same place in the product lineup is deeply silly, at best.
Re:counter offer? (Score:4, Insightful)
Chances are the board owns between them a controlling share of the company, making joe blow stockholder's opinion rather valueless.
Re:It speaks volumes that they were caught out... (Score:5, Insightful)
Old and slow Ballmer.... old and slow...
Oh please. Yeah, there were people who predicted this. There were also people who predicted that Sun would go to Apple, Lenovo, or Acer. It wouldn't surprise me if somebody predicted that SourceForge would buy it for the sole purpose of upgrading Slashdot's hardware!
There are so many BS predictions out there, it's darned easy to miss the ones that actually make sense. Everybody I know was caught flatfooted by this. There are lots of good reasons to think that Oracle couldn't or wouldn't buy Sun: their partnership with HP, the difficulty of borrowing money right now (IBM was going to use its cash reserves, which isn't an option for Oracle), and the difficulty Oracle will have maintaining good relationships with the hardware companies it depends on — which are now its competitors.
Hindsight is always 100% accurate. So what?
Re:Is this good? (Score:5, Insightful)
You can't really buy what Redhat has worked to gain over the years.
Yeah you can. It's a publicly traded company. You don't even need their permission to buy it.
And it would only cost you $3.3 billion - the $1 billion in cash and short term investments you'd acquire when you did. But $2.3 billion for a company with only a half billion in annual revenues, 76 million in annual net income (with no income growth despite dramatic revenue growth) doesn't seem worth it.
It's not that you can't buy RedHat. You don't want to.
You can't buy Linux, but you sure as hell can buy RedHat and the developers won't be jumping ship. Especially in this economic climate where raising money for a RedHat fork that can compete with the RedHat brand isn't likely.
And you sure as hell can sell RedHat as a lot of insiders have been doing lately. If you can sell something, you can buy it.
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Re:Is this good? (Score:5, Insightful)
If you choose not to decide, you still have made a choice.
Re:Is this good? (Score:4, Insightful)
First, I like Linux. Right now around me I have one Windows desktop, and an equal mix of Solaris and Linux development servers running Debian and CentOS and even DSL on an old laptop.
You obviously don't understand how stupid some of the things are that people say about Linux around here though. For example, when IBM was in talks to buy Sun, some person replied that RedHat should buy Sun. RedHat and Novel combined couldn't afford to buy half of Sun.
I suspect that Oracle is going to allow Solaris to be EQUALLY supported
When you're customers are choosing Solaris over Linux, you don't allow Solaris to be supported, it's not your choice. If you want to stay in business and make money, you do what your customers want.
They believe that Linux is the way to break MS's monopoly since it has such traction.
And that's the wrong way to do it and it's been failing.
First, Linux didn't have traction. Unix had traction but MS has been eating into that market.
Linux went after the low hanging fruit, the Unix market since it was more compatible with Unix than MS.
Meanwhile MS has been eating into the server market.
The right way to do it would have been to use Linux as a way to stabilize or grow the Unix share in the marketplace against MS and carve out a bigger piece for itself in that space. Instead, they decided to attack the Unix space and spread the same type of FUD that MS does.
So in the end, Linux is gaining share against Unix, but it's growing share in a constantly shrinking slice of the pie.
Re:Is this good? (Score:4, Insightful)
the developers won't be jumping ship
Most high-power Linux developers have tended to put their money where their mouth is in previous similar situations. Despite the environment, I doubt they'd have trouble finding new jobs.
RedHat fork that can compete with the RedHat brand isn't likely.
The value of the Redhat brand is largely tied to its independence and long term reliability and predictability on strategic issues. Most possible buyers of Redhat do not have the same track record of free software dedication (a company like Oracle would be dead in days if they had to compete with their own version of CentOS for their various products; they certainly don't seem to endear themselves to their customers).
For most buyers of the company the brand would basically cease to exist, so any fork would have little to compete against, apart from the various other vendors, of which Ubuntu would probably be the major gainer.
Re:Uh, no (Score:3, Insightful)
Oh, right. They spent all that time and effort up to and including actually making an offer without any "deeper examination". They had all the time necessary to examine the fit and they chose to make an offer.
Oh, you mean "further consideration" after Sun rejected their offer?
In this "futher consideration" they weren't interested anything other than coming up reasons why their failed offer didn't make sense, in hindsight, after being refused. It only means they are tyring to save face. Or sour grapes.
Citing regulatory scrutiny as the driving factor behind not persuing Sun seems a bit sketchy, IMO.
No Need to Regret Not Buying Sun (Score:5, Insightful)
Allow me to explain.
The bulk of Sun's revenue comes from SPARC-based servers. Sun simply cannot afford to develop further SPARC processors -- including the so-called chip-multiprocessor ones like Niagara. Why? Sun lost the workstation market on the desktop to Intel. The last SPARC-based workstation used the UltraSPARC III, and sales of this workstation were discontinued after 2007. Look at Sun's web site. The sales of SPARC-based workstations are finished.
Without the economies of scale from selling hundreds of thousands of SPARC chips in hundreds of thousands of workstations, Sun cannot afford to develop the SPARC processor any more.
Without SPARC processors, most Sun's servers would disappear, and so would the bulk of its revenue. Sun could continue selling Fujitsu-designed SPARC systems, but Sun's profit margins on those are small.
Basically, Oracle will terminate the hardware business at Sun. In other words, Oracle paid $7.4 billion only for the software business of Sun. $7.4 billion is too much for such a miniscule part of Sun. Software brings little revenue (or profits) to Sun.
Re:I hate to be the grammar Nazi here... (Score:3, Insightful)
You got the vocabulary, so I guess it could be first language. Which would really be a shame. :)
Not my native tongue either. He made interesting points, nothing to be ashamed.
You have shown your incapacity to focus on the essential: the content, rather than the spelling. I feel like it is more serious than few typos personally.