The Sun acquisition has not closed yet, so the company cannot disclose any specific plan. Without concrete information about that, what we have published so far, and what follows below, is pure speculation.
Nonetheless it’s worth spending some more time evaluating the strategy that Oracle may put in place and how it may impact the current players.
As already said many times, now the company is in the unique position to offer an entire computing stack, including servers, storage, the hypervisor, the operating system, the middleware, some of the most used business applications, thin clients, a VDI connection broker and an enterprise management software to coordinate all of the above.
Leveraged in the right way, and assuming Oracle may become a credible virtualization player, it represents a remarkable competitive advantage for some customers (while others can clearly see it as a painful way to lock themselves in).
VMware, Citrix, Microsoft and now Red Hat, have to deal with multiple vendors and support thousands of different hardware and software components (VMware just launched a certification program for software. Why did they have to do that?). And a lot can go wrong when your hypervisor is the glue that keeps together servers, storage, network, guest operating systems, enterprise management agents, guest middleware and guest applications.
Oracle is the only one, in the virtualization market, that could say, “We know exactly what happens at every level of the stack, because we provide all the components; we can guarantee the behavior and the performance of our virtual infrastructure because there are no 3rd parties involved.”
There’s another company that is in a similar position, but in a completely different market: Apple.
Apple develops its software and its systems, and is fully in control. Steve Jobs considers this one of Apple’s biggest assets:
We’re the only company that owns the whole widget — the hardware, the software, and the operating system. We can take full responsibility for the user experience. We can do things that the other guy can’t do.
It is a lock-in, the growing number of issues around the iPhone App Store approval process confirms this, but it’s a huge success.
Of course the consumer market and the enterprise market are different worlds, but Oracle may well pitch its virtualization offering in the same identical way.
If so, Oracle is going to compete with the just born Virtual Computing Environment (VCE) coalition, a nice acronym that also means VMware Cisco EMC, the three companies that founded it.
The value of VCE products, the self-contained virtual data centers called Vblocks, is not only in the hardware and software that make the units. It’s in the fact that VMware, Cisco and EMC design, produce, test and certify the units to serve a specific amount of virtual machines, for a specific amount of users, interacting with specific workloads, that perform in predictable ways.
In other words the VCE coalition saves the customer the huge investment of designing his own data center and the costs of designing it in the wrong way.
When the customer buys a Vblock, he is not just buying the hardware and the software. He is also buying the know-how that these three companies put in the machines. A know-how that he would have to produce by himself or buy somewhere else.
To validate this approach, VMware Cisco and EMC had to form a new entity and share investments, because none of them controls the full stack. Oracle does, and if the future of IT will be dominated by modular data centers, where a single vendor provides self-contained units that customers just stack up together, then Oracle now has the opportunity to become a leader in that future just as much as Cisco.
The difference between Cisco and Oracle is that the former has already clarified its interest in doing so and took several steps to change its current image of networking provider, while the latter… well, the latter still is the well known database giant. And no more than that.