Oracle gets Telco!

If it's one thing that surprised me the most from Wednesday's Oracle-Sun strategy session held at Oracle's headquarters in Redwood City, it was hearing Oracle President Charles Phillips mention "NEBS" in his opening remarks. And show a slide featuring Sun's NEBS ATCA blade servers surrounded by NEP logos (Sun's OEM customers). And proudly acknowledge Sun's market leading presence in the central offices of large telecoms. Holy Toledo. Oracle gets Telco!


Sun's success in telco was a fact often lost on Sun executives. The OEM business was even less understood within the company. Oracle's management seems to have quickly identified this hidden jewel within Sun's portfolio and plans to capitalize on it.


Oracle was also crystal clear about what they will NOT do. Forget about low-end x86 servers with Windows on it or variants of Linux. For that matter, forget about low-end anything. Buy your low-end gear from somebody else. Solaris is not about being the best workstation or desktop OS. It's built for high-end markets, where five 9's reliability, radical scalability and screaming fast performance are table stakes. There was no mention of continuing an Oracle-Sun branded Star Office desktop productivity suite but rather a cloud-based pay-as-go or subscription service. Imagine that.


Oracle's strategy is a radical departure from the Sun of old. One of Sun's greatest failings, in my opinion, was management's inability or unwillingness to cut poor performing products from its portfolio. In other words, an inability to decide what NOT to do. Products that were not profitable often carried forward from year to year with declining investment - doomed to suffer death by a thousand cuts. In so doing, resources were never fully available for those products that truly stood a chance to succeed. Make no mistake, Sun has developed many incredible technologies. The challenge at Sun was never around innovation but in making the difficult choices that come with having so many interesting options to pursue.

Oracle won't have that problem. They are brutally financially driven. Their presentations made that clear. There was no ambiguity, no open decisions, no blank stares from the audience. Larry Ellison's vision of delivering an integrated, optimized and tested stack from server to app offers the telco world a game-changing solution. A new model for product lifecycle management that could significantly lower OA&M costs over time while delivering cheaper, better, faster service for their customers. Oracle has the resources to invest in Sun technologies that offer incredible cost reductions in the wireless infrastructure world (e.g., virtualization with LDOMs, packet processing software with Netra Data Plane Suite, multithreading with SPARC CMT) particularly suited for deployments in emerging markets (see earlier blog post on 4G). Oracle's stated plan to spend $4.3B in R&D in FY11 made it clear that they will do so.

None of this will be easy. Getting multiple engineering teams to work together seamlessly is always a challenge. But now at least they'll be under one roof. As Larry put it, "the proof is in the pudding." I can't wait to see how that pudding tastes.