Oracle Earnings Strong, But Does IT Care?

As courtroom dramas and industry rivalries drag on, what CIOs really want is innovative ideas that fuel business growth.

Fritz Nelson, Vice President, Editorial Director InformationWeek Business Technology Network

September 21, 2011

5 Min Read

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Here are the tired headlines of the day: Oracle reports strong earnings, hints at big new products for Oracle Open World; HP's stock still getting hammered; Oracle and Google CEOs do battle in court behind closed doors; HTC has a new Plum-colored Android phone. Court battles: Oracle vs SAP, HP, Google, Rimini Street; Apple vs Samsung. (iPhone 5! iPhone5! but when?)

Attention grabbers, to be sure, but for IT buyers and consumers, much of this becomes chatter, or a fun distraction during a busy day. It's difficult to draw a straight line from Microsoft raising its dividend (they just did) to buying decisions.

The top story on our site for the past few days: 20 Innovative IT Ideas To Steal.

Right now, Windows Phone 7's Marketing Problem is also getting IT attention. Regardless of all of the noise and attention that Apple and Google demand, the truth is that IT has had, for better or worse, plenty of experience with Microsoft. And no matter how far behind the company is in any given area, customers will always listen.

Don't get me wrong. The Oracle-SAP debates still rage on. Oracle announced that, once again, it crushed its numbers, meaning that customers are gobbling up Exadata, Oracle software and database technology like the after-party on Dr. Drew's Celebrity Rehab. But SAP also keeps humming right along too.

These big dramas still matter, but as these fierce competitors also battle each other in court, or in the press, IT decision makers shuffle along. Their jobs depend not on whose lawyers out-maneuver whom, but on what morsels these companies put before them, and how those morsels nourish business growth quickly and efficiently.

These headline-makers have it backwards. CIOs don't have time to worry about how these companies please shareholders; but investors should care about how these companies please customers. You would think that these things align, but I'm not so sure they do. I particularly enjoyed this quote, on Bloomberg.com on Tuesday following Oracle's earnings news:

"The hardware business is fueling the software business--that's the takeaway," Brent Thill, an analyst at UBS AG in San Francisco, said in an interview. "Without the hardware business, their infrastructure business would not be putting up the kind of numbers it is. They're seeding the market."

What?! Gobbledygook.

Early last week at the InformationWeek 500 Conference, our annual gathering of CIOs, a jam-packed ballroom watched and listened as HP's Chairman, Ray Lane, not only spelled out HP's vision, including the reason it is looking into spinning out its PC division, killing off its mobile hardware, and acquiring Autonomy. It was the clearest, cleanest, (and perhaps only) explanation most of us had heard from HP in the past month. But Lane revealed a few other interesting tidbits that stick with me still.

First, he bothered to come. Here's the chairman of HP's board, with plenty of other things to do, including the many other roles he has outside of HP, and yet he realized that HP had botched things with customers, and he came to clear it all up. The company's CEO Leo Apotheker was scheduled to be there, but pulled out at the last minute, though he managed to show up at an investor meeting the day after. In talking with CIOs throughout the conference, it was clear to me that Ray Lane's symbolic gesture wasn't lost.

But Lane wasn't just some silver-tongued suit on stage. He clearly knew HP's business exceedingly well, and could talk about everything from the company's strategy to its products. At one point, I teased Shane Robison, the chief strategy and technical officer of HP, that Lane might be gunning for his job. Lane also knows HP's customers--when I asked him what the single biggest CIO challenge was, he said: finding, keeping and managing talent. Bingo.

When we talked about our conference theme, "The Need for Speed," Lane talked about how customers need to make decisions quickly and move on, harkening back to his days at Oracle when customers would take months to decide between Oracle and SAP. On stage, Lane ventured that ultimately it didn't make much difference which one a customer chose.

Probably not a message shareholders wanted to hear, but one that resonates with customers.

One high profile CIO told a handful of us that we needed to hear about, and learn more from failure. So at the InformationWeek 500 conference, Pacific Northwest National Labs CIO Jerry Johnson got on stage to talk about his organization's "failure"--a major security breach that rocked government circles. Johnson was bombarded with questions, and practically accosted after his talk.

In an era where stock price and investor angst drives headlines, it's nice to hear that customer pain still matters. While big vendors accuse one another of stealing intellectual property, filing injunctions around the world, IT practitioners are openly sharing successes and failures, and encouraging each other to "steal" their ideas.

Fritz Nelson is the editorial director for InformationWeek and the Executive Producer of TechWebTV. Fritz writes about startups and established companies alike, but likes to exploit multiple forms of media into his writing.

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