Oracle Calls HP Itanium Lawsuit a 'Publicity Stunt'

title=Fierce Competition for the Unix Market} 

Oracle also denied the existence of any contract obligating it to continue developing its enterprise software for Itanium. Such a contract would have been negotiated and documented, but none exists. Instead, HP is implying such a promise based on two sentences Oracle wrote in a press release announcing the end of the legal dispute around Hurd's hiring by Oracle.

The sentence read: "HP and Oracle Corp. today reaffirmed their long-term strategic partnership and the resolution of litigation regarding Mark V. Hurd's employment at Oracle. The agreement also reaffirms HP and Oracle's commitment to delivering the best products and solutions to their more than 140,000 shared customers."

"No sophisticated corporation would ever secure a supposedly life-or-death software support commitment with two fuzzy sentences in an agreement that primarily deals with an employment dispute-to do so would be not only utterly irresponsible, but a violation of every imaginable duty of care owed to shareholders," Oracle wrote in the document. "In fact, to make this all the more bizarre, in the context of the Hurd dispute HP actually asked for a commitment from Oracle to -support all ongoing versions of HP-UX with Oracle's relevant database, middleware and application products'-and Oracle unequivocally rejected the request because, among other things, it was so out of line in that context."

In the court document, Oracle noted that Intel continues to improve the performance of its Xeon server chips, and that the performance difference between those and the Itaniums is negligible. It was the high performance of Oracle's Exadata Database Machine running on Xeon chips that convinced Oracle CEO Larry Ellison earlier this year that the Xeons were as good as the Itaniums, and he told a "senior Intel executive" that Oracle was considering shifting its focus away from Itanium and entirely onto Xeon.

"The response was that Oracle's proposed change in plans was exactly the right thing to do and consistent with Intel's own plans," Oracle wrote. "Ellison concluded-correctly-that even though Intel had not announced a formal end-of-life for Itanium, probably because HP did not want Intel to do so, Itanium's end-of-life had to be no more than a few years away. Otherwise the Intel executives would have made at least some argument for continued Oracle support."

Intel executives-including CEO Paul Otellini-have said several times since Oracle's announcement that they have no plans to end Itanium develop, but instead are working from a roadmap that extends years out.

Many analysts and joint HP-Oracle customers also are siding with HP in the dispute, saying that Oracle's decision amounted to a power play designed to harm HP and prop up its own SPARC hardware. The competition for the lucrative Unix market continues to be fierce. IDC analysts in May said that Unix server revenues in the first quarter grew 12.5 percent-to $2.6 billion-over the same period last year, and that the top three Unix server vendors-HP, IBM and Oracle-all saw revenue increases. In a survey, Gabriel Consulting Group also said that most enterprise IT managers saw their Unix systems as crucial to their businesses, and almost half said they were planning to increase their use of Unix.

Analysts have argued that the real winner of HP-Oracle dispute will be IBM, which already is the top Unix systems vendor and can leverage the instability created by the conflict between rivals to siphon off HP and Oracle customers.