The Linux Beacon--Oracle Bags Yahoo as Unbreakable Linux Customer

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Volume 4, Number 11 -- March 27, 2007

Oracle Bags Yahoo as Unbreakable Linux Customer

Published: March 27, 2007

by Timothy Prickett Morgan

Last week, software maker Oracle--which you can no longer just call database maker, considering its number two positions in application software and middleware--announced its financial results for its fiscal third quarter ended February 28. Oracle's sales were up 27 percent to $4.4 billion in the quarter, and net income was up 35 percent to just over $1 billion. But the big news as far as the Linux market is concerned was that Oracle has bypassed BEA Systems as the second-largest supplier of middleware software and that it has displaced Red Hat as the Linux supplier to Yahoo.

Larry Ellison, Oracle's founder and chairman, talked about the middleware market position ahead of the Linux news for effect, basically throwing down the gauntlet to the suppliers of commercial support for the Linux operating system. "It took us a long time to catch and pass BEA, but we did it. We did it with a combination of innovation and acquisition, and years and years of determination and endurance," said Ellison. "I am very proud of what the middleware team has achieved."

And then, without skipping a beat, Ellison started talking about Linux.

"We're in the early days of our Linux support business, but we're off to a very solid start," Ellison explained. "Our Linux support service is up and running well. Dell, HP, and CDW are on board to resell Oracle Enterprise Linux." [He actually mixed up the name of Oracle's product, which is Unbreakable Linux, and Red Hat's, which is Enterprise Linux]. "We're already signed a number of support contracts, some for over a half million dollars. And Oracle has replaced Red Hat at Yahoo and numerous other customer sites as their Linux support supplier. That is extremely important, and this is just the beginning. We're not going to build this Linux business over night, but we will build it. We have the largest and best support organization in the world, and we are determined to offer our Linux customers the best support in the world."

There is very little money in Linux support, and Oracle knows this. But if it can eat into Red Hat's Linux support business--particularly by using Red Hat's own Linux distribution against it, as the open source licensing model allows--then it can put pressure on Red Hat's plans to be a middleware and database and application provider. That, ladies and gentleman, is what Oracle's Unbreakable Linux is all about.

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Editor: Timothy Prickett Morgan

Contributing Editors: Dan Burger, Joe Hertvik, Kevin Vandever,
Shannon O'Donnell, Victor Rozek, Hesh Wiener, Alex Woodie

Publisher and Advertising Director: Jenny Thomas

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Oracle Bags Yahoo as Unbreakable Linux Customer . . . Financial Services Industry Spent the Most on Servers in 2006, Says Gartner . . . Rackable Builds Data Centers in Shipping Containers, Too . . . HSBC Follows Wal-Mart in Microsoft-Novell Deal . . . Black Market for ID Theft Has Strong U.S. Ties, Symantec Finds . . . Fortran Creator, John Backus, Dies at 82 . . .

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