Author Archives: Didier

Oracle buys Sun

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via Between the Lines

As everybody already knows, Oracle is buying Sun for about $7.4 billion, including Sun’s debt ($9.50 a share in cash). Some interesting thoughts from Larry Dignan, Editor in Chief of ZDNet.

  • [Oracle] added that the acquisition of Java “is the most important software Oracle has ever acquired.”
  • Oracle also becomes a full-fledged hardware player.
  • Oracle and Sun have been long-time partners. […] “More Oracle databases run on the Solaris Sparc than any other system,” said Ellison, noting Linux was second. “We’ll engineer the Oracle database and Solaris operating system together. With Sun we can make all components of the IT stack integrated and work well.”
  • Oracle with Sun appears to be the Apple of the enterprise. Indeed, Oracle President Charles Phillips noted that the company is looking to offer everything from apps to the disk.
  • Oracle’s stack of IT stuff now includes:
    • Java;
    • Solaris;
    • Enterprise applications ranging from CRM to ERP to business intelligence;
    • The database (Oracle and MySQL);
    • The middleware;
    • The storage hardware;
    • Cloud computing services;
    • And servers.
  • Art of War approach:
    • Oracle gets to annoy IBM—and own Java—over a few pennies a share more than Big Blue was willing to pay.
    • Oracle gets to kill MySQL. There’s no way Ellison will let that open source database mess with the margins of his database. MySQL at best will wither from neglect. In any case, MySQL is MyToast.
    • Sun has a big installed base. All the better to upsell applications into.
  • Sun was relatively cheap compared to Oracle’s other acquisitions. The price was above the Hyperion buyout but below PeopleSoft and Siebel.
  • Oracle saves Sun management from what could have been a complete debacle following the IBM takeover talks. The Sun board had been split on the IBM deal. Today, it’s all roses.

The official Oracle press release can be found here.

It is clear that this deal will change the IT landscape quite massively. And the consolidation is definitely not finished…

Cross-posted on the Innoveo Blog.

What next for HP?

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via Judith Hurwitz

Judith has joined the yearly HP industry analyst summit organized by HP. This summit is dealing with everything at HP, excepted the PCs and printers. Based on the discussions there, Judith is giving her view on the possible future of HP. Very interesting analysis!

I think that HP is at a crossroads. Today it is the largest technology company. This is a wonderful opportunity because size gives customers comfort. […] On the other hand, it provides a challenge. When you are this big, you have to act big and bold. You have to set a leadership agenda that the market and the customers take note of. […]

  1. Be Top Dog in Selected Markets. HP’s overall strategy remains consistent: it’s objective is to be either number 1 or 2 in each product category it participates in. While HP has made some strides in achieving this lofty goal, it is still a work in process. […]
  2. EDS is larger than HP’s printer business. With EDS as part of the portfolio, the amount of revenue from printers and ink has started to diminish. In fact, HP executives proudly announced that EDS is as large as HP’s printer revenue. […]
  3. Procurve chases Cisco in network management. While HP has been in the networking business for decades, it has been a well kept secret. Because of HP’s tight partnership with Cisco, HP has been wary of appearing to compete. However, it appears that HP is now willing to take on Cisco in the networking switching arena. […]
  4. The software business is (still) important. HP has long had a love/hate relationship with software. HP has selected management and automation to focus its software business. […]
  5. HP does the cloud. […] Clearly, the cloud strategy is a work in progress. But HP is thinking about the right issues as it makes its way into this important emerging area. HP’s intent is to leverage its software assets to create a common framework for its cloud strategy. HP anticipates that it can leverage EDS’s expertise to gain a cloud framework that it can leverage with customers.
  6. HP expands Software as a Service. When HP acquired Mercury it also picked up a growing SaaS business. The company is planning to continue to focus on this arena both in the enterprise market and the SMB market. SaaS offerings will continue to focus both on the testing and the remote monitoring markets. […]

HP is very focused on being a provider of IT services, hardware, and software. It has no desire to be a business management or a business consulting organization. While HP is most comfortable in the hardware arena, it is making important strides in this part of the business. […]

The software business, on the other hand, is still at a transition point. While HP has done extremely well with its performance management and testing business, it has had a hard time creating an overall software portfolio. Opsware is clearly being used to provide the foundation for cloud computing but it will take some more time and cycles for this platform emerges as a power. […]

In my view, there will be more aquisitions to come for HP. I suspect that most will be in software and will have to fill the gaps in data management and security. […]

Disclosure: we are at Innoveo member of the Development and Solutions Partner Program (DSPP) and a worldwide Financial Services Industry Partner.

Cross-posted on the Innoveo Solutions blog

Crazy compensation committees and CEO’s

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via Jeff Bussgang

I am just flying into a rage when I hear all these bonus and golden-parachute stories!

All these stories with these crazy CEOs that are doing a very bad job for their companies, which need to be helped by the government and are receiving billions to save their business. And, at the same time, are delivering bonus for themselves and their managers. This is just intolerable! Do not forget, these guys are not alone, there are “great” remuneration committees that are voting these golden-parachutes and crazy bonus. Why not talking also about them?

How can employees accept this kind of behavior? They are not acceptable.

We shouldn’t wonder why CEOs have such bad reputations today, when some are acting in this way, and just impacting all the other CEOs in a very negative way…

Very nice post from Jeff expressing this point of view more in detail:

Perhaps the most successful venture capitalist in history, Sequoia’s Mike Mortiz (backer of Google, Yahoo, Paypal, to name a few reasonable wins), said in a recent interview that one of the ways he decides whether to invest in an entrepreneur is how much they plan on paying themselves. Moritz views high salaries with immense suspicion. If the founder takes a modest salary (in start-up land, that’s typically $100-200k per year – well below even President Obama’s $500k cap), he knows they believe in the future value of their business. […]

Remember, entrepreneurs aren’t saints or selfless do-gooders. They typically work 80-100 hours per week for two reasons. First, they are PASSIONATE about their venture for the sake of the business and its impact on the world more than the money (“Ask me about my business and you can’t shut me up,” confessed my friend Scott Savitz, CEO/founder of Shoebuy.com, the other day). […]

They want to prove to their investors and employees that the risk they took in investing in them and joining their cause will pay off. Why don’t Fortune 500 CEOs feel the same way? Why is it that they don’t view their role in life to prove to the shareholder that buys their stock in the public market that they took a worthy risk and they’ll be darned sure it pays off? Instead, they think it’s culturally acceptable to take outsized pay packages and perks that no educated, rational shareholder would ever approve if given the chance. […]

The behavior is in such stark contrast to what’s going on in the small business, job-creating end of the economy, it’s absurd. The public is understandably outraged. I am too. That’s why I’d fire all the compensation committee heads and turn the reigns over the start-up CEOs. […]

Saint Barth – Part XXII

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Although we are back from paradise/Saint Barth, and fully jetlagged, I would like to continue for a while to publish some posts, in order to finish this “Saint Barth 2009 series”.

The last two days in St Barth were quite windy and consequently, we have decided to have a walk on the “wild” coast of St Barth. Completely different landscapes there, you should understand rapidly the reason of the name “wild” ;-)

Our first walk was around the Grand Fond Bay.

 

For some pictures, it looks a bit like … Ireland ;-)

A video will also follow!