Once More unto the Breach

Oracle Linux: Novell or Red Hat? (Hopefully neither!)

Updated 18-Apr-2006, 13:30: Added the postscript on the Boston Globe quote. 

This morning saw reports in the Financial Times that "Oracle considers venturing into Linux".  This was picked up by CNet (via Reuters) which set up the discussion about Oracle's desire to deliver a entire stack of technology to customers, and then drew attention to the quote that Oracle has even "considered buying Novell."  And thus are rumour mills fed.  Let's actually look at the discussion in a business context:

In an interview with the Financial Times, Mr Ellison said that Oracle wanted to sell a full “stack” of software that, ... included both operating system and applications. “I’d like to have a complete stack,” he said. “We’re missing an operating system. You could argue that it makes a lot of sense for us to look at distributing and supporting Linux.”

Not an unreasonable opinion.  Go all the way back to Geoff Moore and Crossing the Chasm (1991).  You want to present a "whole product" solution to your customer, i.e. your core revenue driver and all the complements you can reasonably provide that your customer perceives as the complete solution to their problem.  If to sell an Oracle "solution" today means Oracle licenses and Oracle vertical specific applications, AND an expensive operating system on expensive hardware, AND an expensive application server, then reducing the overall cost to the customer while driving the core revenue generators would seem to be A Good Idea. 

As part of a recent study of the open source software market, Mr Ellison said that Oracle had considered buying Novell, which after Red Hat is the biggest distributor of Linux. “We look at everything, play this thing out,” he added.

This statement should not surprise anyone that has worked in a large enterprise with a view of the executive offices.  Companies explore ideas on paper constantly in their corporate/business development offices.  Lot's of "what if" scenarios are played out, and numbers crunched without anyone ever committing to doing something.  Companies even pay good money to the McKinsey's of the world for this sort of analysis even if they have their own inhouse "business consulting team". I'm sure Oracle has also run the numbers on Red Hat and SuSE (before the Novell acquisition) and developing their own distribution at various times in the past, and will do so again.   

“Now that Red Hat . . . competes with us in middleware, we have to re-look at the relationship – so does IBM,” he said.

This last quote is the troublesome one (or maybe it's a misquote without context).  Oracle is the enterprise relational database company.  It's been expanding its brand with vertical specific Oracle applications.  It needs middleware (i.e. an app server), like it needs an operating system on which to run, but it isn't a middleware company. 

Go back to the original business goal expressed in the article, that Ellison wants to provide a complete stack or solution to his customer.  Good idea, but he has better ways to spend shareholder dollars to solve customer problems than acquiring the stack outright, and then living with the cultural consequences and long term engineering expenses of becoming an "operating system company" and an "app server company" as well as their primary focus as the enterprise database company.  Spending good money to get into other rapidly commoditizing businesses, rather than serving your customers needs by supporting companies like Red Hat with its JBoss acquisition that already know how to make money in a different margin business seems a waste.

As I suggested Friday, Oracle should be hammering down Red Hat's door to expand the relationship with all the money they saved by not acquiring JBoss, or in this case (hopefully) Novell.

P.S. You have to love news editors.  I was interviewed by Hiawatha Bray from the Boston Globe yesterday.  The quote as it appeared:

But Stephen Walli, vice president of Optaros Inc., an open source consulting firm in Cambridge, said buying Novell or Red Hat would be a mistake for Oracle.

''They would have to carry all that cost on their balance sheet," Walli said. ''I think it would be a really bad idea."

This is why I blog the whole idea.  While accurate, the quote could mean it was a mistake for Oracle's business to carry the engineering expense compared to the value to their solution to their customers (which was meant), OR that Novell or Red Hat are dogs that one wouldn't want on one's balance sheet (which wasn't meant).  Maybe I'm being overly sensitive. 

 

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Mono, Microsoft, and Mischief

Update (17-Sep-2005, 19:00 PDT): Well the party did indeed happen, t-shirts and all!  I'm sorry I wasn't in L.A. for it.  Todd Bishop from the Seattle Post Intelligencer was covering the PDC and talked with Miguel.  He talks about mono in an article and on his blog.  Hopefully Miguel posts pictures soon.

Apparently Microsoft is again denying Miguel de Icaza a Mono BoF at this year's PDC. This is such a missed opportunity for Microsoft.  Microsoft needs Mono.  They published the CLR and C# language specifications as international standards through ECMA and ISO, but it still looks like a proprietary controlled technology to the customer base.  Standards are a message in the marketplace that encourage multiple implementations.  As long as there is only one commercial implementation, there is no standard, and the customers know it regardless of the number of trees killed to produce specifications.  Encourage Mono and then deliver the better integrated experience for writing web services on .NET.  Of course that would require the ability to ship software in a timely fashion. 

Microsoft is the company that re-branded the ".NET Server" to "Windows Server 2003", and ".NET" to "Windows .NET" to ensure they really drove home the idea that it's all about Windows.  At this point in their existence, they already own that word in customers' minds, and unfortunately customers know that really means their "desktop".  There was the opportunity to own a new word — ".NET" — and even associate it with the idea of servers, but that's gone now.  It's "Windows .NET".  IBM learned a long time ago to own new words.  They have a history of owning new words and moving along with their customers.  There was "mainframe" and "PC" and even "Selectric" at one glorious time.  Digital Equipment Corporation on the other hand ended up only owning one word.  Too bad. 

If I was Novell, I would start a nasty viral ad campaign for the PDC.  Instead of gathering in a hallway like stubborn refugees, get a meeting room in a neighbouring hotel, or take over a bar like a Dick's Last Resort.  Pass out invitation cards and put out notices in the lobbies of all the local hotels for the PDC, and on the message boards at the conference.  Set-up the screen and one of those nifty portable projectors, plug in the laptop, and let Miguel do what Miguel does so well.  Buy the beer and the food.  Hand everyone a copy of the latest SuSE distribution, and whatever Mono tools can be put together.  Hand out t-shirts to the first 100 people through the door and make them GREAT t-shirts.  (I'm thinking a brick wall background with the Mono monkey logo "spray painted" on the wall in a loud fluorescent blue or green.  No words.  No other logos.  We already know what the Novell logo looks like and it would spoil the effect.)  Encourage everyone to wear them to the PDC the next day.  Remind Microsoft that you're customers — and that it's your money.  Make the Mono BoF the best little party of the PDC.  It certainly couldn't cost as much as a booth in the vendor hall. 

Of course that's just what I'd do.