Dear Larry: It was a treat to see and hear your thoughts on a range of subjects from your after-dinner Q&A at the Churchill Club last week: competing with IBM, the idea of Oracle evolving into a systems company, the "uncertainty card," your competitor/partner relationships with major tech companies, and your passionate commitment to Sun and to fulfilling the enormous potential you see in it.
It was also intriguing to hear you describe your views on competition, whether in the business or in world-class sailboat racing: "Life is a series of acts of discovery. We're all interested in our limits, and what we can accomplish in life, and in discovering our own limits." Your comments gave people a better sense of why you've chosen via the Sun acquisition to pursue a path that most others would never have even seen, let alone taken.
What seemed to be missing from your wide-ranging comments, though, was a sense of the role that Oracle customers play in your ongoing thinking and planning and actions. Don't get me wrong—it was, as I said, a unique opportunity to hear you describe your battles against IBM even as IBM installs more Oracle software than any company in the world; and to hear you say that Andy Grove is a brilliant guy but also fundamentally wrong; and to hear you say that you have a "great relationship" with HP CEO Mark Hurd and great respect for Oracle's relationship with HP even as it, along with IBM and Dell, are trying to ravage Sun's customer base.
It just seemed a bit odd—actually, maybe more than a bit—to see these sweeping and penetrating and candid comments from one of the world's top executives with so little mention of the role that customers are playing in your thinking. At a time when every business in every industry is going to extreme lengths to engage customers more directly and more intimately because customers today have more choices and more information and more-unique requirements, it would have been particularly valuable for you to talk less about Netezza and Teradata and IBM and SAP and Dell and HP and more about the customers that have invested tens of millions of dollars—in some cases, many tens of millions—with Oracle, and why they've done that, and how they have grown and prospered with Oracle as a strategic partner.
For example: you spoke at length about how your company has beaten IBM at software (a contention, by the way, that is not universally shared among some objective sources such as Gartner), and how you yearn to compete against it on a level playing field so that you can prove that you can beat it at hardware, but you said next to nothing about specifically how and why this will bring greater value to Oracle customers. In fact, you went out of your way to highlight at one point that IBM installs more Oracle software than any other company—if IBM's such an obviously inferior competitor, why do they sit at the top of the stack for installing your products?
That almost makes it sound like you believe the competition is all about technological features instead of about customer value, or that your interest in competition ends when the customer takes delivery of the product. Indeed, a bit later in your talk, you again cited IBM Global Services —the company that installs more Oracle software than does any other company in the world—and you criticized its approach as being driven by consultant services instead of by engineering. To me, that raises two vital questions:
1) If customers have been suffering for so long under this inferior model, why didn't you buy a company with extensive hardware assets two or three or four years ago?
2) If IBM Global Services's approach, based on consultant services, is flawed, then how has it become the #1 integrator of Oracle products in the world? And if it was an approach of which you didn't approve, why haven't you and Oracle found a different type of partner whose approach more closely resembles the engineering-level approach you intend to take with Sun?
I'm sure you have great answers for those questions but in the absence of any customer context, it's hard to know what those answers might be. In fact, the one point in the first part of your talk where customers did come up was in relation to IBM's assertion that it has taken 250 customers from Sun. Here's what you said about that: