Implications For Oracle

Of course, the conventional wisdom is that the reason Oracle is dumping Itanium is to prop up its Sparc server business, whose sales continue to lag rivals'. There's even widespread speculation that Oracle might end software development for IBM hardware platforms. I've seen no such statements from Oracle, but nor have I seen denials. For now, IBM Power servers, Oracle/Sun Sparc servers, and clustered, scale-out deployments of commodity x86 servers are the obvious migration paths.

Conventional wisdom also has it that enterprise software choices always trump hardware decisions, but there may be some significant exceptions this time around. For one thing, there are finally signs that Oracle's next-generation Fusion Applications are being deployed after several years of delays. If companies find that moving to Fusion from JD Edwards, PeopleSoft, or Oracle e-Business -- all of which are on or approaching their final releases -- requires them to make huge adjustments or take on massive user training, it presents good reason to consider alternatives.

At last year's SAP Sapphire conference, co-CEO Bill McDermott said he was only too happy to see Oracle head into a Fusion upgrade cycle, because it will prompt those customers to shop SAP "if only to keep Oracle honest on price." That was before Oracle's decision to dump Itanium and the ill will it's generating in some quarters. SAP is sure to crank up the freedom-of-choice and who-do-you-trust slams against Oracle at this May's Sapphire.

With SAP in mind, the Itanium flap isn't just about Oracle applications. SAP has a significant base of customers, including Chevron and General Mills, that run its enterprise software and Oracle's database on Itanium. (I reached out to both companies, but Chevron declined to comment and General Mills had yet to respond at this writing.)

Joint SAP-Oracle customers won't have to change apps to stay on Itanium; they just need to change databases. IBM is only too happy to oblige with DB2.

Oracle's move away from Itanium could also play into SAP's hands in other ways. SAP is laying the groundwork for its customers to replace third-party databases with its own in-memory database, a long-term move that will build on the technology behind SAP's Hana appliance. For the short term, SAP is working on porting and certifying the ASE database of Sybase, which it acquired last year, to run SAP apps. ASE continues to support Itanium, and I expect certification to be announced at Sappire.

You might scoff at the prospect of Oracle-trained teams adopting rival databases. And there will have to be many compelling reasons to switch apps, the least of which (at least from a business perspective) would be support for a particular server platform.

But there's enough competition in the market today for creative vendors and customers to come up with many more ways for Itanium customers to move forward. If customers think they're being treated to rough-and-tumble tactics, they'll take a long, hard look at any and all alternatives.