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Sun, Oracle, and Open Source

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Quite a day. I wake up to see announcements about Oracle completing their BEA acquisition, Sun buys MySQL, and an announcement about new capabilities from MuleSource. Following my concept of “stuff hapening in threes is the universes way of telling me something”, I felt like these items were worth commenting on.

I know a number of people who are at BEA who are bit relieved that the entire acquisition process is over. There was quite the distraction hanging over the place with acquisition offer looming out there. And now you will see the exodus of people surge. Not many people that I know over there are excited about working for Oracle. But, from the Oracle perspective, this is a great buy. They removed a competitor in the app server market, get to cherry pick the Weblogic platform to integrate it into their own, and they finally get technology to make their Fusion product work. Hopefully there is no mis-understanding of the reality of this acquisition from the BEA user community…your BEA products will be going way…

Sun’s purchase of MySQL will be something interesting to watch. Sun isn’t know for their ability to acquire and not ruin technology. My understanding is that the Sun software business unit had a great year that they are wrapping up. But, Sun as a company still isn’t known for their ability to create value for customers with business solutions. I know some people there who have been able to do that in their small area’s of influence, but senior management still seems to be stuck in the hardware mentality that is part of the Sun DNA.

The bigger concern, is what does this acquisition do to all the SaaS and Web2.0 business that run on MySQL? While I haven’t been paying a whole lot of attention to Sun in the past few years, I have noticed them trying to surge ahead in the these two areas. It’s almost like a rebirth of their luminary “We are the Dot in dot com” marketing campaign of the internet bubble era. I have had some recent first hand experience with their Solaris Zones virtualization technology and find it highly lacking (not to mention a pain to use in a number of ways) from other solutions. Thus, I don’t hold a lot of hope out for them in the arena of virtualization. Hard to see much vision here…

MuleSources announcement of their 1.5 version with it’s governance feature and BAM like capabilities is interesting. While I haven’t had any direct experience with their offering, I find it interesting that they are not sitting on their hands and dealing with just integration but trying to add value to the larger enterprise. They show that they are not content to deal with just one small brick in the enterprise foundation. By taking on these two areas, they are now setting themselves up to be an annoyance to other larger players, most likely in the hope of widening their audience of possible suitors. (Too bad I didn’t’ get to know them better when they worked down the hall from me…)

Beyond the Software Consolidations

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Today I came across an interesting posting from Chris Schneider, CEO of MomentumSI, about Consolidations in the Software Industry. He makes some interesting observations about recent consolidations in the technology industry amongst the “next 40” (the largest 40 software/services companies after Microsoft). He also points out the next set of acquisition targets from that same set.

Predictions are always hard to make (and harder to look at years later). But out of Schneider’s next acquisitions, I have my own set of thoughts I wanted to share.

  • Sybase, Tibco, BMC and CA – I actually don’t see these companies being acquired. While there are some interesting technologies that they all own (BMC and CA have a diverse collection of tools…both old and new), at a cursory glance there is nothing immediately compelling within them to make them acquisition targets.
  • Cognos and Citrix – These could be acquisition targets from someone.
    • Citrix has application virtualization and acceleration technology that might be interesting to someone; as long as their other applications are of interest or could be easily disposed of.
    • Cognos is interesting to those who are looking to acquire customers in the BI space (maybe combining with Sybase?)
  • Red Hat and Adobe – I don’t see these two being acquired (or wanting to be)
    • Red Hat – If Red Hat were to be acquired, I fear that the open source world might start to swing in a completely different direction. I don’t see Red Hat letting that happen.
    • Adobe – They have an interesting mix of products that makes them much more unique than these other companies. Their combination of enterprise and end use solutions make them an interesting company to watch in the next few years.

Even more interesting than focusing on these acquisitions, is focusing on the companies that aren’t getting acquired. These are the companies that we don’t hear about that exist below the radar threshold. Small companies that are profitable, doing interesting if not exciting stuff in very focused or niche markets. I know of a number of companies like this that were boot strapped by their founders, grown to impressive revenue numbers, and still kept private and focused on providing value to their customers and their employees.

Some of these companies get acquired every now and then and pop up above the radar level. But the more interesting thing is how many stay down where they are. Perhaps this is part of the maturing of the High Tech industry that has been in process for a while. The development of High Tech business leaders that are in the business for something more than the quick buck or the big bang.