Practical Analysis: Do Oracle Exadata Gains Warrant The Risk?

There's nothing like the unvarnished comments of customers living through a merger between two of their vendors to put posturing in perspective. Back in February, we surveyed 381 business technology professionals about the Oracle-Sun merger and what they expected from the combined company. At that time, we found an audience that was mostly skeptical about the merged company. The recurring theme: Wait and see.

Now half a year later, the momentum of Oracle's Exadata database machine has led to a yelping match between Oracle brass and its competitors. The fervor reached a high enough pitch that we reran our survey and the updated results are telling.

The survey data reveal an audience who's a tad more skeptical than it was six months ago, with the most noticeable difference being those who say they have no interest in buying major applications in appliance form. Back in February, just 7% said they had no interest; now 18% tell us they have no interest. In this question the options ranged from "we'll only buy software this way" to the most popular "we'll evaluate the appliance option just like every other option" to "we won't buy software this way," the last being the biggest mover.

The comments give us a pretty good idea about what's going on here. Technology and performance aren't the issue. IT pros respect the engineering prowess of both the Oracle and Sun teams. They get that with some work, one plus one can add up to more than two with the combination of Sun hardware and Oracle software, but they also know the sum won't be all that much more than two. So in order to get that 5% to 15% performance improvement (any more is a miracle, and miracles don't happen in IT), IT pros will have to deal with the Oracle sales team and after sales support. And this is where the problem lies.

Most survey comments that relate to sales portray the Oracle team as arrogant and the Sun team as inept. But far worse, every single comment from Sun customers pertaining to service said that service on their Sun products had gotten demonstrably worse since the merger. That's a disaster for Oracle's appliance strategy. If the perception is that an organization offering a 15% performance advantage either can't or won't sufficiently service the product, who in their right mind would buy one? The benefit isn't sufficient to make up for what could be a career-ending risk.

There's no doubt that IT organizations value having just one "throat to choke," but if you're already doing some choking now and aren't seeing satisfactory results, why would you risk a purchase as strategic as something like an Exadata machine? At least if you integrate the software and hardware yourself, you can try to play the two vendors against each other. With an appliance, it's a marriage, and you'd better like everything about the bride.

On the face of it, that Oracle makes a big deal out of performance is a telling mistake. Just like we no longer buy cars based on horsepower alone, IT purchases have long since ceased to be about performance. Factors like value and risk are at least as important, and for existing Sun customers, the risks are just getting bigger.

Art Wittmann is director of InformationWeek Analytics, a portfolio of decision-support tools and analyst reports. You can write to him at [email protected].

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