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Global CIO: As Regulators Jam Oracle, IBM And HP Snatch Sun Customers

While Oracle sits in legal limbo, IBM and HP are blitzing Sun's customers in a prime example of the superb buyers' market that exists for CIOs today.
Just a thought: Exabyte is an example of Ellison's concept of "software-optimized hardware," which he has said would become a huge benefit of Oracle's acquisition of Sun. In partnering with HP exclusively for the Exabyte machine, Oracle has had to work on an extremely intimate basis with HP engineers and developers. Will such intense collaboration be able to continue after the Sun deal is consummated and Oracle's sales team finds itself in frequent and intense competition with the HP sales team for server and storage business?

How about with HP's EDS services business: Will it be able to offer and support Oracle products when they are clearly the best solution for customers? Again, I'm just asking.

On the other hand, IBM has long been accustomed to slogging it out to the death with Oracle in databases, middleware, and other fronts. IBM's message to Sun's current customer base about "Don't settle for an uncertain future" is, like HP's, backed with a dazzling array of offerings that only the two largest IT companies in the world could provide. And IBM begins its offer with a swift kick at what is now a very vulnerable area for Oracle:

"The undefined future of Sun's hardware plus Oracle's lack of experience in running a hardware business puts your infrastructure at great risk for forced migration and increased cost," IBM says. "But don't worry, IBM has migrated 5,000 customers worldwide in the last 4 years from competitive platforms, and we offer a clear, cost-effective roadmap for Sun customers like you. Let us prove it. Join the Movement."

IBM then offers "two great reasons to migrate now," featuring deep technical rationale with the "IBM Systems Migration Assurance" and financial/merchandising incentives with "The Sun-Set Special." That Sun-Set Special says, "Migrate from Sun servers to IBM by December 31, 2009 and you can earn up to 8,000 Power and zRewards points per core. Those points can be redeemed for selected services and software products from IBM and our partners."

But if it's true that one man's ceiling is another man's floor, then Oracle's tribulations in regulatory hell could well be a tremendous boon for CIOs. Because in these rough economic times, when CIOs are loath to spend but IT vendors are desperate for sales, the programs that IBM and HP have laid out could well become the baseline by which those and other companies will agree to deal with all customers, not just Sun's.

And that could be extremely vital for CIOs who must find creative ways to begin to reverse the 80/20 ratio (80% of IT budget sucked up by internal requirements, leaving only 20% for innovation) in order to be able to fund growth-oriented projects that will be indispensable when the economy turns around.

As JPMorgan Chase CIO Guy Chiarello, one of the world's top CIOs, recently described the opportunity to InformationWeek's Mary Hayes: "For Chiarello, these are good times to get work done, even with the "tremendous pressure" on his IT budget. Chiarello doesn't know how long the vendor price competition of this economy will last, but the company's positioned "to make it last forever, because I won't pay a dollar more [than I paid] for the last thing I bought." "

GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

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