Oracle Back in Court, This Time vs. HPE
However, HP executives said that the damage to its high-end server business had been done. After Oracle announced it was pulling support of Itanium, HP's Business Critical Systems unit saw revenues in some ensuing quarters drop more at times more than 30 percent, and filed suit against the software vendor, saying they would seek as much as $4 billion. That number is now $3 billion—which includes not only business lost as a result of Oracle's decision but also future sales that were lost—as the trial gets under way in California Superior Court in San Jose. Opening arguments were held last week, and the trial is expected to take several weeks. "Oracle needs to be held accountable for its actions, which caused billions of dollars in damages to HP and significant uncertainty for our customers," HPE officials said in a statement. In its own statement to USA Today, Oracle called the amount in damages being sought by HPE "astonishing," noting the "abundant evidence that the RISC and Itanium market had already been in a widely recognized long decline." The non-x86 server market has seen a steady decline over the past several years as Intel has increased its dominance in the system chip space with its x86-based Xeon processors. According to IDC analysts, in the first quarter of this year, revenues in the worldwide x86 server space grew 2.6 percent over the same period in 2015, to $10.6 billion, even as the number of units shipped fell 2.9 percent.
The non-x86 server space—which includes RISC, Itanium and ARM systems, as well as mainframes—saw revenues fall 28.7 percent, to $1.8 billion. These servers represent 14.7 percent of all the system revenue in the first quarter, the analysts said.