The escalating feud between Hewlett-Packard and Oracle reached new heights the evening of September 7. Specifically, Oracle CEO Larry Ellison threatened to cancel Oracle’s business relationships with Hewlett-Packard, stating that HP’s board is making it “virtually impossible” for Oracle and HP to work together. If Oracle walks away from HP, it would be the second time since February 2010 that a major IT company halted HP relations. Here’s the update.
As you’ll recall, former HP CEO Mark Hurd joined Oracle as co-president on September 6. HP on September 7 filed suit in an attempt to block Hurd from joining Oracle. Now, Oracle CEO Larry Ellison has issued a tersely written statement:
“Oracle has long viewed HP as an important partner. By filing this vindictive lawsuit against Oracle and Mark Hurd, the HP board is acting with utter disregard for that partnership, our joint customers, and their own shareholders and employees. The HP Board is making it virtually impossible for Oracle and HP to continue to cooperate and work together in the IT marketplace.”
Is Ellison bluffing? Or is Ellison set to end Oracle’s 20-plus year business relationship with HP?
It’s Deja Vu All Over Again…
Before you answer that question, consider HP’s recent history with Cisco Systems. Tensions between HP and Cisco mounted throughout 2009 as the two companies increasingly competed in the server, storage and networking markets. By February 2010, Cisco Global Channel Chief Keith Goodwin announced the end of Cisco’s business partnership with HP.
Now, let’s shift back to the HP-Oracle feud. In a bit of ironic timing, HP Executive VP Ann Livermore is scheduled to speak at Oracle OpenWorld later this month. And HP is listed as a diamond sponsor for Oracle OpenWorld. The VAR Guy is checking in with both HP and Oracle to see if HP will continue to participate in the conference, which is one of the largest annual IT gatherings of the year.
Happy Ending?
Of course, the feud could simmer down as quickly as it started — assuming HP and Oracle somehow find some common ground amid the current standoff. But right now tensions are running quite high. And 100,000 joint HP and Oracle customers are watching to see if the Oracle-HP feud can be resolved.
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VAR Guy, if there is one thing I know, from studying Ellison – and as a startup founder who suffered greatly after acquisition by HP — it is that Larry is spot-on, and he not kidding around about this.
HP’s board – in addition to their prior series of mistakes in this matter – seems to have forgotten that in addition to being a competitor via the Sun acquisition, ORCL is also a hugely important customer and strategic ally.
Earth to HP (box)!
- steve bell | HP acquired
Steve: The VAR Guy thanks you for your additional insights. Some of the major media outlets, particularly BusinessWeek, say HP won’t be able to stop Hurd from working at Oracle…
-TVG
I have to agree with Steve Bell. HP really needs to evaluate whether this is a battle that it wants to engage in. Having both Oracle and Cisco may affect HP’s ability to certify solutions in the future.
Also I have to admit that Oracle with the SUN acquisition looks pretty strong. They also have negotiating power with the support of Oracle on HP systems. If Oracle wanted to leverage ZFS, I believe they have support power over Netapp. Oracle’s ability to certify and de-certify Oracle database on vendor platforms gives it a vast amount of industry control.
Devon, Steve: Seems like HP has painted itself into a corner by trying to do the right thing. First, HP tries to be a buttoned-up organization and parts ways with Hurd because of questionable expense reports… Then, HP tries to protect its intellectual property. The VAR Guy isn’t choosing sides, but it’s interesting to see which party the media will paint as the bad guy:
1. HP’s Board?
2. Mark Hurd?
3. Oracle and Larry Ellison?
The VAR Guy continues to watch the story closely…
-TVG
When I worked at HP we hired someone direct from a competitor. Can’t remember who specifically. He/She was under similar constraints. I asked someone in the know how HP could get away with this. Simple answer was that HP had secured a promise from this new hire that he/she would not disclose any confidential info from previous job. Seems HP may have to prove that Hurd will have to reveal HP’s Confidential info. Oracle, of course, can structure the job so it makes it very hard for HP to prove this. Outcome is that HP will have done to it as HP has done unto others.
I guess I was on to something with the netapp Oracle thing the other day. I found this article this morning.
http://www.cio.com/article/611063/Oracle_NetApp_Agree_to_Settle_Patent_Litigation?source=rss_news
What is interesting, is there is not a mention as to whether Oracle will still continue to use ZFS. I think compatibility and support of the database on Netapp may have been leveraged.
Just my conspiracy thought.
Devon: Please keep sending The VAR Guy your conspiracy theories and he’ll be sure to investigate each one. But please: Nothing that Oliver Stone has already covered…
-TVG