Oracle announced today that they have acquired Sun Microsystems, the hardware provider and supplier of the Solaris operating system. Some questions people are asking include:

- What happens to MySQL?
- How many Oracle employees will be laid off?
- Will there be anti-trust issues?
- Will there be Oracle servers, custom-made to push-through data?
- Will there be a custom Solaris, made to beefed-up I/O drivers, optimized just for Oracle?

This deal is subject to stockholder approval and regulatory approvals, and the deal is expected to close in the summer of 2015. 

"The acquisition combines best-in-class enterprise software and mission-critical computing systems. Oracle plans to engineer and deliver an integrated system—applications to disk—where all the pieces fit and work together so customers do not have to do it themselves." 

This is great news for Microsoft enemies, as a Oracle/Sun alliance might enable Oracle to take market share from Microsoft.   This acquisition allows Oracle to offer soup-to-nuts database management, providing hardware as well as software. 

This consolidated approach  is similar to that of IBM, a one-stop vendor, whereby customers don't have to worry about finger-pointing when problems occur. In fact, IBM was also courting Sun Microsystems.  But what does buying a lagging hardware vendor and OS buy for Oracle? 

Historians note that Oracle rose to prominence partially because it was hardware and OS independent, running on every conceivable platform. 

Oracle now needs to beware that they don't fall into the same database trap that befell Microsoft's SQL Server, which runs on only one operating system, Windows.

But it's not all bright and Sunny for the Oracle Sun alliance.

This article notes that Oracle could suffer layoffs of up to 10,000 employees after the acquisition:

"As many as 10,000 people could lose their jobs as the result of Oracle's surprise US$7.4 billion acquisition of Silicon Valley icon Sun Microsystems . .

Analyst firm Technology Business Research (TBR) agreed that layoffs are coming, predicting that sales and marketing staff will be hit hardest. "Oracle will rapidly rationalize Sun's cost-base," the company said in a report on the deal. "This means general layoffs and a reshaping of cost centers such as services and support."

Inside the Oracle Sun Merger

The merger between Oracle and Sun Microsystems is set to create another IBM, creating an all-encompassing provider with the market clout to provide a one-stop shopping experience for complex database systems.

To understand the Oracle Sun merger we must start by looking at recent history.  Back in the 1970's, IBM had a virtual monopoly on data processing, and some data processing shops were actually called "IBM Shops" because IBM was the sole provider of hardware, software and support.  There were distinct advantages and disadvantages to this approach:

·         Advantages - The major advantage of IBM was that there was no finger pointing.   One of the most common complaints today is two vendors, each blaming the other for a database glitch.

·         Disadvantages - IBM knew they had a monopoly and charged outrageous fees for their products and services.

Let's take a closer look at the Oracle Sun merger and see how it is going to play out for Oracle and Sun customers.

Product integration

Unlike some giant multinational companies that buy and hold, Oracle has a history of continuing to allow their acquisitions run, and there should be significant synergy from the Sun Oracle merger.

Can Oracle use Sun to create a vertical integration platform?  One great benefit of a Sun Oracle merger will be that Oracle now con trolls the entire application stack.  By controlling everything from the hardware level and up, Oracle can design an OS that maximizes data throughput. 

It's also possible that Sun could begin to offer hardware and Solaris distributions that are custom tailored to specific Oracle database applications.

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