Silicon Valley Crackup: Oracle & HP Killing 25-Year Alliance?

1) After HP forces out CEO Mark Hurd: "The HP board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago," [Ellison] famously told the New York Times.

2) After HP sued Hurd to prevent him from joining Oracle: "Oracle has long viewed HP as an important partner," said Oracle CEO Larry Ellison. "By filing this vindictive lawsuit against Oracle and Mark Hurd, the HP board is acting with utter disregard for that partnership, our joint customers, and their own shareholders and employees. The HP Board is making it virtually impossible for Oracle and HP to continue to cooperate and work together in the IT marketplace." (Sept. 7, 2010)

3) Reconciliation on the eve of Oracle Open World, Sept. 20: "HP and Oracle Corp. today reaffirmed their long-standing strategic partnership and the resolution of litigation regarding Mark V. Hurd's employment at Oracle," HP said in a statement. "While the terms of the settlement are confidential, Mr. Hurd will adhere to his obligations to protect HP's confidential information while fulfilling his responsibilities at Oracle. The agreement also reaffirms HP and Oracle's commitment to delivering the best products and solutions to their more than 140,000 shared customers."

The HP statement then quoted interim CEO Cathie Lesjak as saying the companies "are committed to working together to provide exceptional products and services," and quoted Ellison as saying they will "continue to build and expand a partnership that has already lasted for over 25 years."

4) Reconciliation wrecked when HP replaces Hurd with former SAP CEO Leo' Apotheker: Of all the executives in all the industries from all the companies, HP picks the one guy with whom Ellison would find it just about impossible to work: Leo Apotheker, who not only worked for Oracle's arch-enemy but was ultimately fired as CEO over declines in market share, profits, employee morale, and customer trust.

Of course, it's not the job of HP's board to placate Larry Ellison and Oracle with its choice of CEO. But it's also impossible to imagine that the HP board, particularly with its simultaneous addition of venture capitalist and one-time Ellison lieutenant Ray Lane, would not have understood the repercussions with Ellison that their hiring of Apotheker would have.

And those repercussions—at least the initial ones—were juicy. Here it is from the Wall Street Journal: "I'm speechless," [Ellison] wrote in an email to the Wall Street Journal. "HP had several good internal candidates…but instead they pick a guy who was recently fired because he did such a bad job of running SAP." An H-P spokeswoman said Ellison's comments don't "deserve the dignity of a response" [end of excerpt].

5) Meanwhile, SAP's reaction was quite different: Since the enemy of my enemy is my friend, Oracle rival SAP believed HP's appointment of Apotheker was a stroke of genius. Here's a comment I received from SAP co-CEO Bill McDermott: "This is great news for HP and for SAP. SAP and HP are outstanding partners, HP is a great SAP customer, and this move only sets the stage for an even deeper relationship between our two companies. Leo understands our business model and how to fully advantage this partnership to help our joint customers be best-run businesses. I personally congratulate Leo on this tremendous appointment."

6) Ellison says with Apotheker as CEO, SAP engaged in "industrial espionage and intellectual property theft": In early October, with the damages portion of the trial between Oracle and SAP only one month away, Ellison stepped up his pointed attacks on Apotheker's leadership and integrity. As I wrote at the time,"Larry Ellison is cranking up the heat on Oracle's now-tenuous strategic partnership with HP by trashing newly named Hewlett-Packard CEO Leo Apotheker as not only a dismal failure as CEO of SAP but also as the leader of SAP during the time it committed 'industrial espionage and intellectual property theft' of Oracle software."

7) Ellison taunts HP's board over Apotheker's potential testimony: "I don't think Ray Lane wants to risk Leo Apotheker testifying under oath as to why he allowed the theft of Oracle's property to continue for 8 months after he was made sole CEO of SAP. I hope I'm wrong, but my guess is that new HP's Chairman, Mr. Lane, will keep HP's new CEO, Mr. Apotheker, far, far away from the Courthouse until this trial is over."

RECOMMENDED READING: Global CIO: Is Larry Ellison Going Soft On HP And IBM? Global CIO: Oracle Seeks New Whipping Boy As SAP Thrives Global CIO: Is Larry Ellison Hurting Oracle By Hammering Competitors? Global CIO: HP Claims Server Supremacy And Tells IBM: Migrate THIS! Global CIO: Larry Ellison Vows To 'Go After' HP; Is Alliance Dead? Global CIO: Will The Oracle-HP Alliance Survive The Oracle-SAP Trial? Global CIO: In Larry Ellison's Legal Battle With SAP, HP Is Collateral Damage Global CIO: Are HP And SAP Perfect Match Or Train Wreck? Global CIO: Larry Ellison's Heightened Attacks On HP Doom Alliance Global CIO: Larry Ellison Puts HP In Crosshairs Via Slap At New CEO Global CIO: Resurrecting Mark Hurd: Larry Ellison's War With IBM Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

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