How Will Customers View the Deal?

By Chris Preimesberger  |  Posted 2009-04-21 Print this article Print

Martins said he wasn't sure about how customers will view the deal.

"I'm simply not sure at this point," he said. "We may see a mass exodus [of Sun customers] over the next couple of years, unless Oracle presents a clear and compelling vision for its customers."

Martins also wondered about the value of StorageTek's tape business.

"Sun's tape [business] is now up in the air. I mean, really, what the heck is Oracle going to do with STK [SotrageTek] remnants in a market that's not dead, but slowly dying?" Martins said. "I'd like to see those assets sold off to a company that is willing and able to actually support it over the next several years, but who?"

Enterprise Strategy Group storage analyst Brian Babineau believes Oracle has two options to choose from regarding its new storage products/services cache.

"They can go vertically integrated; i.e.: only sell storage with a database and server, and specialize [the solutions] with an application," Babineau said. "Or they can maintain a horizontal business [i.e.: sell storage systems against EMC, NetApp, Dell, HP, and others] while building vertically integrated solutions.

"I'm betting that they do the latter, which would make this a very interesting market from a competitive standpoint. That being said, storage hardware doesn't have the same margin profile as software -- or integrated systems with software."

An 'Interesting' New Market About to Emerge

What makes this a more interesting market from a competitive standpoint, when Oracle enters the storage sales competition?

"Most of the storage vendors' sales people chase Oracle sales people around, because when a database is implemented, there is a high likelihood that new or  incremental storage capacity will be needed," Babineau said.

"If Oracle is now selling storage, this cat-and-mouse game could get flipped upside down, with the traditional storage vendors having to fight against a once easy-to-work-with 'partner.' "

If you chase a mouse long enough, you may not catch it, but are likely to find cheese, Babineau said. Thus, you get to eat your fair share.

"But, if you cannot catch the mouse, and it eats all the cheese, then you spend all your time running around -- and you starve," Babineau said.

Will Oracle become that uncatchable mouse? Lots of storage companies are wondering this right about now.

Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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