Oracle may drop sun deal?

[phil.s...@gmail.com]

The EU is very skilled at wealth destruction:

http://www.dailyfinance.com/2009/11/04/e-u-requirements-may-force-oracle-to-drop-sun-deal/

[Jess Holle]

I'd argue that the EU authorities in question are anti-competitive.

Killing off Sun as they're doing only serves to increase the dominance of IBM and Microsoft in the broader picture.

Does anyone seriously see Sun+Oracle as a monopoly in any area?

--
Jess Holle

[Robert Casto]

The EU is just trying to stick it to the US. Oracle/Sun is a great combination to compete against Microsoft and IBM. There must be some other reason the EU is dragging its heels.

--
Robert Casto
www.robertcasto.com

[Casper Bang]

While Mårten Mickos did write the EU to try to convince them, a few
things have not been covered by the Posse or in this forum:

MySQL co-founder Michael Widenius wrote to express his concern:
http://monty-says.blogspot.com/2009/10/press-release-concerning-oraclesun.html

The same did GNU high priest Richard Stallman:
http://www.computerworlduk.com/toolbox/open-source/open-source-business/news/index.cfm?newsid=17238

The EU is not at all satisfied with the info delivered by Oracle thus
far*:
http://www.ft.com/cms/s/0/653e8e88-c8ba-11de-8f9d-00144feabdc0.html

*Having seen all the vague marketing material and empty promises by
Oracle, I can't say I'm surprised.

/Casper

On Nov 4, 3:32 pm, "phil.swen...@gmail.com" <phil.swen...@gmail.com>
wrote:

> The EU is very skilled at wealth destruction:
>

> http://www.dailyfinance.com/2009/11/04/e-u-requirements-may-force-ora...

[Fabrizio Giudici]

Casper Bang wrote:
> While Mårten Mickos did write the EU to try to convince them, a few
> things have not been covered by the Posse or in this forum:
>
>

While there might be legitimate concerns, letting Sun go bankrupt
doesn't sound as a good idea, neither for MySQL nor for all the other
technologies. Unfortunately, bureaucrats at EU just read some manual and
apply procedures brainlessly, so...

--
Fabrizio Giudici - Java Architect, Project Manager
Tidalwave s.a.s. - "We make Java work. Everywhere."
weblogs.java.net/blog/fabriziogiudici - www.tidalwave.it/people
Fabrizio...@tidalwave.it

[Casper Bang]

Have you read the article I linked to? "...commission officials
confirmed that, in spite of repeated requests, Oracle had neither
provided them with evidence that the deal would not cause competition
problems, nor discussed possible remedies."

And after seeing the extremely thin material Oracle released to their
customers, I have to admit that the scenario described above seems
very likely:
http://www.unixmen.com/news-today/366-no-mysql-no-java-in-oracle-developing-plans-

/Casper

On 4 Nov., 16:07, Fabrizio Giudici <fabrizio.giud...@tidalwave.it>
wrote:

> Fabrizio.Giud...@tidalwave.it

[Fabrizio Giudici]

Casper Bang wrote:
> Have you read the article I linked to? "...commission officials
> confirmed that, in spite of repeated requests, Oracle had neither
> provided them with evidence that the deal would not cause competition
> problems, nor discussed possible remedies."
>

I've read tons of articles. If you look at the one posted in the first
message of this thread, you'll see that the first conflict between US
and EU antitrust authorities dates back to 2001 (a merge approved by US,
not by EU). After that episode, the two authorities tried to cooperate.
In this case, it sounds as they didn't. For instance, some newspaper
could illustrate us why concerns are only in EU and not in US, I'd be
pretty curious. And nobody can't even blame G.W. Bush for that.

--
Fabrizio Giudici - Java Architect, Project Manager
Tidalwave s.a.s. - "We make Java work. Everywhere."
weblogs.java.net/blog/fabriziogiudici - www.tidalwave.it/people

Fabrizio...@tidalwave.it

[Casper Bang]

> For instance, some newspaper
> could illustrate us why concerns are only in EU and not in US, I'd be
> pretty curious. And nobody can't even blame G.W. Bush for that.

Things work very differently between the EU and the US. As an example,
in the US you are allowed to bash and humiliate a competitor. A
typical political add contain no real objective information, but
revolves solely around personal attacks on opponents, their past and
various irrelevant affiliations. The same goes for products.
It may be there's a pissing contest going on as Reinier puts it, but
technically it really isn't a regulatory's job to lookout for the
financial health of an involved company. Bottom line: When large
companies swallow each-other, it impacts the competitive situation.
This is what the commission is responsible for investigating - this is
where I believe there are profound differences between the US and EU.

/Casper

[Jess Holle]

When regulators obstruct deals causing one of the competitors to be irrevocably crippled that also impacts the competitive situation.

From a competition standpoint we essentially have 2 options:

1. Marketplace minus Sun in any effective form
2. Marketplace with Sun+Oracle merged
   

One might argue that there are other options, but I think by the time the EU gets done messing around those will not be real possibilities -- and that Sun will have been crippled to the point that any other purchaser of Sun would be a fire-sale purchaser and not salvage Sun in an effective form.

Of these 2 options, I believe #2 is greatly preferable to #1 from a market health and competitive landscape standpoint.  Simply knocking off one of the competitors is quite anti-competitive in its own right -- and that's just what the EU is effectively doing here.

--
Jess Holle

[Sean Comerford]

It seems ironic to me that the major hangup here seems to be stopping Oracle from killing MySQL.

If Sun isn't bought at (especially if this deals fall through) the company will eventually go bankrupt and MySQL will essentially be dead in the water anyway.

And what other company out there large enough to buy Sun does NOT have a competiting DB product? MySQL would just as much the ugly step brother of DB2 at IBM.

As a former Sun employee who still likes the company, I feel bad for the remaining employees. They've been in limbo for so long and it never seems to end.

[Bjorn Monnens]

Does anybody know what happens with the price if Oracle has to drop mysql? If you pay 7.4 billion and a part of the revenue comes from a product you have to drop, shouldn't somebody be paying the money you lose?

On Nov 4, 2009 5:33 PM, "Sean Comerford" <sean.c.c...@gmail.com> wrote:

It seems ironic to me that the major hangup here seems to be stopping Oracle from killing MySQL.

If Sun isn't bought at (especially if this deals fall through) the company will eventually go bankrupt and MySQL will essentially be dead in the water anyway.

And what other company out there large enough to buy Sun does NOT have a competiting DB product? MySQL would just as much the ugly step brother of DB2 at IBM.

As a former Sun employee who still likes the company, I feel bad for the remaining employees. They've been in limbo for so long and it never seems to end.

On Wed, Nov 4, 2009 at 11:09 AM, Jess Holle <je...@ptc.com> wrote: > > When regulators obstruct de...

[Fabrizio Giudici]

Bjorn Monnens wrote:
>
> Does anybody know what happens with the price if Oracle has to drop
> mysql? If you pay 7.4 billion and a part of the revenue comes from a
> product you have to drop, shouldn't somebody be paying the money you
> lose?
>

I'm not expert here, but I presume Oracle would just sell mysql to
something else (or force Sun to sell it before finalizing the buy) and
get the money from the operation.

In the meantime, I back the points, that I've already expressed, by Jess
and Sean. I'd add that MySQL is not the only FLOSS and reputable
database on the market. There's Postgresql too, and thus even if (I
repeat if) the EU concerns about MySQL's fate were correct, this
wouldn't automatically imply a catastrophic things for FLOSS databases.

[Jess Holle]

Others have expressed elsewhere that the EU has a sentimental (and non-objective) attachment to MySQL -- and the MySQL brand as opposed to perfectly good forks thereof.

MySQL has European origins -- PostgreSQL has origins in the US.  I think unfortunately it may be that simple for the folk making these decisions.

--
Jess Holle

[Casper Bang]

Nah, that sounds more like a conspiracy story than anything else (a
lot of those going around regarding the Sun-Oracle merger). PostgreSQL
is a much smaller player than MySQL, by a wide margin:
http://www.mysql.com/why-mysql/marketshare/

/Casper

[Eric Newcomer]

I'm more convinced by the theories that it's SAP the EU is concerned about. 

Eric

On Nov 4, 2009 3:16 PM, "Casper Bang" <caspe...@gmail.com> wrote:


Nah, that sounds more like a conspiracy story than anything else (a
lot of those going around regarding the Sun-Oracle merger). PostgreSQL
is a much smaller player than MySQL, by a wide margin:
http://www.mysql.com/why-mysql/marketshare/

/Casper

On Nov 4, 7:17 pm, Jess Holle <je...@ptc.com> wrote: > Others have expressed elsewhere that the EU ...

[Steven Herod]

I concur with the suggestion about SAP.

It's probably Europe's crown jewel when it comes to software, and it's
directly competing with Oracle. (And I would theorise, in the long
run, going to get its arse kicked in two ways (Oracle taking the high
end with an hardware to services story and cloud solutions taking the
lower/middle market).)

On Nov 5, 9:11 am, Eric Newcomer <enewco...@gmail.com> wrote:
> I'm more convinced by the theories that it's SAP the EU is concerned about.
>
> Eric
>

[Reinier Zwitserloot]

Wow, lots of confusion flying around this thread.

First of all, if the sun+oracle deal drops through, MySQL is obviously
not 'dead in the water'. Companies that die don't just go away. They
file bankruptcy and try to restart after selling off lots of pieces,
or if they don't make it, a curator comes in and sells every piece.
The keyword, here, is *sell*. Assets get sold. This always happens,
unless an asset is so worthless nobody is willing to pay anything for
it, in which case one could argue that the term 'asset' doesn't even
apply.

MySQL will simply be bought by some entity. What entity? Well, that's
open for debate, but for companies of this size, the curator is
usually court-appointed with orders to also consider things like
competitive health, so presumably a bid by somebody OTHER than
Microsoft or Oracle, even if its lower, will win to keep the DB market
more competitive.

Secondly, from some more research I've done on the case, it seems like
a clear case of bluff to me, and I seriously question Oracle's
management in this whole deal. The EU is NOT as stubborn as I thought
they were back when I wrote my 'pissing content' post. They have
decided that simply copying any US-based judgement results in losing
trillions of dollars (thanks, Standard&Poors and Moodies, for the
credit crisis), so instead they're not going to trust US-backed
reports and do their own checking. To do so, they asked a bunch of
info of Oracle, and Oracle decided to pay lip service to these
reasonable demands and instead play a game of political bluff poker:
Stalling, threatening to blow up EU<->US relations, and playing a game
of scorched earth by threatening the very thing this thread started
with: Sun collapsing entirely, hurting the competitive edge even more.

The EU has wisely decided that now is a great time to stop being a
wimp, and putting their foot down. The EU used to just give in, but
has now apparently decided that if they make reasonable demands, then
a US company is just going to have to comply with those demands
instead of playing silly games. *PRESUMING* I analysed both the EU
request and Oracle's response to it correctly, can anyone, European or
American, really fault the EU for doing it, _especially_ considering
that their surrender in the past to such games has led to them losing
over a trillion bucks by holding the risk elements of all those
pyramid scams that are at the root of the economic crisis? I presume
it's not my bias as a european that makes me think the EU is doing the
right thing, here.


In other words, I feel this is 100% oracle's fault in originally
thinking they could just bluff their way past this issue and now being
too stubborn to just give in and work with the EU to resolve some
fairly minor points.

As far as sentiments: I'm sure the sentimental value of the MySQL
brand played a minor role in the EU deciding to NOT just rubber-stamp
this acquisition, but instead do their own checking, but we're waaay
beyond that now. This is a mix of no longer giving in to silly
political games, and protecting major EU-based corporations that will
be affected by this merger and any shakeups in the db industry. SAP is
merely the most visible in a long string of such corporations.

I doubt this is about protectionism of just SAP, though. The EU
countries don't like each other too much for that kind of blind
patriotism.


On Nov 4, 6:21 pm, Fabrizio Giudici <fabrizio.giud...@tidalwave.it>
wrote:

> Fabrizio.Giud...@tidalwave.it

[Fabrizio Giudici]

Reinier Zwitserloot wrote:
> request and Oracle's response to it correctly, can anyone, European or
> American, really fault the EU for doing it, _especially_ considering
> that their surrender in the past to such games has led to them losing
> over a trillion bucks by holding the risk elements of all those
> pyramid scams that are at the root of the economic crisis? I presume
> it's not my bias as a european that makes me think the EU is doing the
> right thing, here.
>

These are two completely different stories. The financial storms were
(partly) due to deregulation in financial markets, which doesn't have
anything to do with a company merge (AFAIK they are dealt with by
different political boards), and the "put the blame on the US" thing
makes no sense, as nobody forced UE banks to do the same thing,
especilally if we pretend to have an independent brain - they
deliberately chose to do that because of easy, immediate earnings
(especially for managers). BTW, it was neither a policy at EU level,
since every country did by itself, and in some countries banks were less
exposed than others.

Back to the topic, of course Oracle has got faults. Larry Ellison's
attitude seems to be very confrontational, if you mind of the America's
Cup thing that has been turned from a sail competition to a lawyer
affair. This is worrying. Nevertheless, the EU position sounds still
stupid to me, also considering what you said in your incipit. If Sun
fails, pieces will be sold at bargain price, and it's likely that Oracle
will get the pieces they're strategically interested to (for me, Solaris
and the hardware). The market will loose a lot of wealth in terms of
competition and technology, not counting layoffs that will happen in
Europe too. It sounds as the EU has more to lost by a hard confrontation.

--
Fabrizio Giudici - Java Architect, Project Manager
Tidalwave s.a.s. - "We make Java work. Everywhere."
weblogs.java.net/blog/fabriziogiudici - www.tidalwave.it/people

Fabrizio...@tidalwave.it

[Reinier Zwitserloot]

The crisis and a merger aren't the same thing at all, but they share
one thing:

(financial) analysis done by a US company being good enough for the EU
to just rubberstamp it, or not.

Those triple-A rated mortgage vehicles that mostly US-based
corporations sold to all sorts of EU entities, without the EU caring
because that rating came from a trusted US company (Moodies or S&P) -
those were all worthless. Moodies and S&P screwed up. The risk on
those as far larger than a triple A ratings warrants, and as a result,
1 entire country has gone bankrupt (Iceland, who just joined the EU),
big banks in the EU have gone bankrupt, and lots of municipalities are
now in big trouble because they invested in triple-As, which are
pretty much not supposed to become worthless.

I, and some other europeans, were basically up in arms that the EU
could just rubberstamp the US financial reports that these triple-A
ratings were legit. This wasn't something the EU had to centrally vet
or okay before individual EU corporations could buy them, so it's
somewhat of an apples-and-oranges comparison, but nevertheless, EU
politicians have been struggling with the crisis which they entirely
correctly blame the DOJ and SEC for. They were supposed to keep
Moodies and S&P in check, as well as AIG and friends, which they
completely failed to do, and the EU blindly trusting Moodies and S&P
on their triple A ratings put on worthless paper is why the EU is
dealing with all this bankruptcy. Sure, it's just as much the fault of
the EU corporations that didn't do any of their own checking of those
ratings, but that's besides the point: The EU has concluded that the
DOJ and SEC can't be trusted to make good judgements. EU corporations
can't either, but that's not relevant. This is where my story picks
up:

EU wants to do their own investigation, Oracle isn't complying to
reasonable demands in service of that investigation, EU decides this
is not the time to be the bigger man and give up, and puts their foot
down, taking the position that reasonable demands means Oracle should
comply instead of threatening to blow up this deal. My conclusion is
that this is oracle's fault far more than the EU's.

You're entirely right in that this is going to lead to scorched earth,
but if the EU gives in *again*, US companies are going to keep
thinking that they can just waltz over the EU by playing petty
political games. They've already proven time and time again that
they'll do it. And why not? Corporations are responsible only to the
shareholders. The EU just finally learned to stop being naive. At any
rate, the EU is morally in the right here. If the scorched earth
scenario does happen, It's Larry Ellison's belligerent attitude that
caused it, and the EU's insistence on receiving the documentation it
asked for can't be blamed. Again, all this is valid only if I
correctly analysed the EU's demands and Oracle's response, which is
all very complex and lots of it isn't even public, so that's a very
big if.


On Nov 5, 10:02 am, Fabrizio Giudici <fabrizio.giud...@tidalwave.it>
wrote:

> Fabrizio.Giud...@tidalwave.it

[Reinier Zwitserloot]

The EU may have more to lose on this specific deal, but in the long
run, making clear to all corporations, european and otherwise, that
reasonable demands must be complied with instead of whined about,
gains them far more than they'd lose now. I'm glad someone is taking a
long-term view, for once.

On Nov 5, 10:02 am, Fabrizio Giudici <fabrizio.giud...@tidalwave.it>
wrote:

> Fabrizio.Giud...@tidalwave.it

[sigvaldi]

On Nov 5, 9:52 am, Reinier Zwitserloot <reini...@gmail.com> wrote:
> The crisis and a merger aren't the same thing at all, but they share
> one thing:
>
> (financial) analysis done by a US company being good enough for the EU
> to just rubberstamp it, or not.
>
> Those triple-A rated mortgage vehicles that mostly US-based
> corporations sold to all sorts of EU entities, without the EU caring
> because that rating came from a trusted US company (Moodies or S&P) -
> those were all worthless. Moodies and S&P screwed up. The risk on
> those as far larger than a triple A ratings warrants, and as a result,
> 1 entire country has gone bankrupt (Iceland, who just joined the EU),

Iceland is not bankrupt (came close, though) and it is still far from
having joined the EU (an application has been sent, that´s all)

[Sean Comerford]

There's no confusion: Sun was a slowly sinking ship 4 years ago when I left after 5+ years at the company.

And the ship is only sinking faster as the merger hangs in limbo - more customers go to IBM, HP, etc to and more smart, hard working employees are axed or leave to avoid the uncertainty.

Have you seen the Sunr earnings reports recently? Do you think the company is really effectively focusing on MySQL or anything else at this point?

Yes, any good technology Sun has would eventually be acquired by someone else even if the Oracle deal falls through.

But how long will that take? The Oracle deal was announced months ago and even if the EU approved the deal today, it would still be at least several months before the deal officially went through and Sun was assimilated fully into Oracle. If the Oracle deal falls through, you're back to square with a dying company trying desperately to stay afloat instead of focusing on moving forward.

In my opinion (based partially on having been there), the bottom line is Sun and alot of what it does is more or less dead in the water, waiting for a company that is actually profitable (i.e. has cash to spend) to take over and make the tough decisions about what to focus on and what to drop.

[Casper Bang]

However, back then it was highly unpopular to say that out loud
(unless your name was Paul Graham or John C. Dworak). One wonders if
this wouldn't have happened even sooner, had Microsoft not
(unwillingly) pumped billions of $ into Sun early in the decade. Sun
appears ridiciously bad (and late) at picking their battles and seeing
them through. It's sometimes said that these problems stem from the
fact that Sun is run by engineers, however these can't be particularly
visionary ones then. Tough, but that's how the smalltalk goes around
the water cooler.

/Casper

On Nov 5, 4:46 pm, Sean Comerford <sean.c.comerf...@gmail.com> wrote:
> There's no confusion: Sun was a slowly sinking ship 4 years ago when I left
> after 5+ years at the company.
>
> And the ship is only sinking faster as the merger hangs in limbo - more
> customers go to IBM, HP, etc to and more smart, hard working employees are
> axed or leave to avoid the uncertainty.
>
> Have you seen the Sunr earnings reports recently? Do you think the company
> is really effectively focusing on MySQL or anything else at this point?
>
> Yes, any good technology Sun has would eventually be acquired by someone
> else even if the Oracle deal falls through.
>
> But how long will that take? The Oracle deal was announced months ago and
> even if the EU approved the deal today, it would still be at least several
> months before the deal officially went through and Sun was assimilated fully
> into Oracle. If the Oracle deal falls through, you're back to square with a
> dying company trying desperately to stay afloat instead of focusing on
> moving forward.
>
> In my opinion (based partially on having been there), the bottom line is Sun
> and alot of what it does is more or less dead in the water, waiting for a
> company that is actually profitable (i.e. has cash to spend) to take over
> and make the tough decisions about what to focus on and what to drop.
>

[Reinier Zwitserloot]

True, and true, but explaining the nuances was a side-track and the
post was long enough as is :P