Oracle Calls HP Itanium Lawsuit a 'Publicity Stunt'

By Jeffrey Burt  |  Posted 2011-06-30

Oracle Calls HP Itanium Lawsuit a 'Publicity Stunt'

Oracle executives are dismissing Hewlett-Packard's lawsuit over Oracle's decision to end support for Intel's Itanium technology, calling HP's move a "publicity stunt" designed to blame the software giant for HP's misguided embrace of a faltering processor platform.

In a 15-page court filing to answer HP's lawsuit, Oracle officials contradict the accusation that they have put customers at risk in hopes of bolstering their own SPARC hardware portfolio. Instead, they said, it is HP's desperate attempts to hold on to a dying Itanium platform that is the real threat to enterprises.

"HP untenably has put itself and thousands of customers out on the end of a very long limb because HP, almost alone now, clings to a decades-old microprocessor architecture-Intel's Itanium chip line-that has no future," Oracle wrote in the legal brief, filed in the Superior Court of California in Santa Clara. "Intel has wanted to discontinue Itanium production for years, and HP knows it.  The performance advantage over Intel's x86-based microprocessors that once justified Itanium is today effectively gone."

However, should Itanium go away, it would be a significant financial blow to HP, which has standardized its high-end Integrity and NonStop servers on the processor and generates money from its Itanium support agreements, Oracle said. HP by far is the largest consumer of Itanium chips.

"So rather than telling its customers the truth about Intel's plans for phasing out the Itanium platform, and helping those customers transition to Intel Xeon systems or other alternatives, HP perpetuates the myth that there is a long 10-year roadmap for Itanium development," Oracle wrote. "Now HP is suing Oracle for the temerity to tell customers the truth."

Oracle officials in March said they no longer would develop software for the Itanium platform, saying that in discussion Intel engineers had said the chip vendor would soon kill off the chip in favor of its x86-based Xeon portfolio. In making its decision, Oracle joined Microsoft and Red Hat, two other major software vendors that had ended Itanium support in their software.

Oracle's announcement drew the ire of both HP and Intel executives, and further splintered the deteriorating relationship with HP, once a strong partner. That relationship began to sour when Oracle bought Sun Microsystems last year for $7.4 billion, putting the software maker in direct competition with HP in the data center hardware space. It was further weakened by Oracle's hiring as president last year of Mark Hurd, the former HP CEO forced to resign under pressure, and then HP's hiring of Leo Apotheker as Hurd's replacement. Apotheker at one time was CEO of SAP, a key software competitor of Oracle.

Intel officials said they have an Intel development roadmap that stretches out through the rest of the decade, and HP officials accused Oracle of purposely risking the well-being of jointed Oracle-HP customers in hopes of boosting the SPARC hardware business inherited from Sun. HP is suing Oracle for breaching a contract to work together for the benefits of their joint customers. The two share about 140,000 customers, with many running Oracle databases on HP Itanium-based hardware.

In their response, Oracle officials derided HP for what they said is a "massive campaign to vilify Oracle for this announcement," and called the arguments in HP's lawsuit "utterly specious." Oracle noted that the company plans to support customers with Itanium systems "for years to come" while they migrate to other hardware platforms. "But Oracle is not going to pretend that Itanium has a future when it does not," officials said in the court document. "Insofar as Intel platforms are concerned, the time has come to focus on Xeon and future x86 chips.  That is Intel's direction, and that is the direction of all other major vendors-except HP.  And Oracle certainly is not going to deny customers the information it has about Itanium, which is crucially important for those customers to make future plans."

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. 

Rocket Fuel