Will Oracle Storage Become an Uncatchable Mouse?
Oracle's April 20 announcement that it is acquiring Sun Microsystems will have consequences more far-reaching than many people imagine. None of these impacts will be more pronounced than in the storage sector, where Oracle has a big potential for gain. At least one analyst believes that Oracle, in selling database software, has an inherent advantage that could lead directly into storage sales.Oracle's acquisition of Sun Microsystems goes a wee bit deeper than a simple M&A story about an enterprise software company adding a limping enterprise systems maker to its long list of conquests.
This deal, should it finalize this summer as planned, will directly impact a number of enterprise IT markets and a huge number of current users.
The markets that first come to mind are data center systems, database hardware and software, storage hardware and software, storage management software, server hardware and software, mobile networking software (through Java), smart cards, identity authentication, high-performance computing -- the list goes on and on.
The only IT sector that won't be affected all that much by this deal is networking, even though Oracle does get to pick up Sun's small switch-designing group.
In this story, however, we're focusing on how this will affect the data storage market, one that Sun has made no secret of cultivating since it acquired StorageTek for $4.1 billion in 2005.
Oracle Getting Some Cutting-Edge New Assets
How will Oracle's entry into the data storage business by owning Sun's X4500 Thumper (a powerful enterprise storage array), StorageTek's highly regarded tape and disk storage products, the fast Zettabyte File System for storage, and the Fishworks (the Fully Integrated Software and Hardware group, which designed and built the Amber Road storage appliance) change the scenery?
"While it remains to be seen whether or not Oracle intends to fully commit to the hardware business -- as it remains possible that they may spin those businesses off to other hardware players -- it would represent a changing of the storage landscape," Stephen O'Grady, storage analyst with Red Monk, told eWEEK.
"Sun would provide Oracle with assets both new and cutting edge [the Fishworks derived product line] as well as traditional [StorageTek]. This means that Oracle would have the ability to compete in the storage market on multiple layers."
However, analyst Joseph Martins of Data Mobility Group disagreed.
"I simply don't see Oracle changing the competitive scenery, certainly not in the way Cisco has," Martins told eWEEK.
"In fact, I expect this acquisition to put a strain on Oracle -- a distraction that storage competitors will undoubtedly exploit. I don't expect to see any real storage innovations come out of Oracle over the next couple of years. After that is anyone's guess."
Off the top, the deal looks reassuring for Sun's customers, because it gives the brand name badly needed financial backing. Is there any downside to having Oracle step in to take over these franchises?
"The primary potential downside of an Oracle acquisition for Sun customers is the impact it might have on portions of the portfolio," O'Grady said. "In the hardware space, these concerns would manifest themselves as questions over Oracle's commitment to this market and the products in general.
"The infusion of hardware and software assets that Oracle would achieve via a Sun acquisition have broad implications from pricing to product availability to strategic direction. It's impossible to say what direction Oracle will take with these assets, but whatever happens Oracle is more relevant to that market than ever."