After losing to HP in a breach-of-contract lawsuit at the beginning of last month, Oracle this week announced that it would comply with the court ruling. The software giant will keep developing its database and applications to run on HP's Itanium servers. But that's not the end of the story.
For those who haven't been keeping up with the case, Oracle and Hewlett-Packard signed a contract in late September of 2010 that explicitly stated the two companies would continue to support each other's products as they had in the past. Following this, some time in 2011, Oracle said that it would stop supporting HP's Itanium-based servers. This apparently took HP by surprise, and the hardware maker sued for breach of contract. The judge in the case agreed, and ordered Oracle to keep supporting the HP/UX servers featuring Intel's Itanium chip.
Oracle was not happy about this; in an objection to the judge's ruling, the database maker complained about the “unprecedented obligation” to produce product for “the dying Itanium technology.” The company plans to appeal, but in the meantime it has agreed to comply with the court's decision.
Therefore, at least at this time, those who use HP/UX servers running with Itanium chips can relax; Oracle has promised that its Oracle Database 12c, which should be out early next year, will run on your system. In a statement, the database builder cites the judge's ruling “that Oracle has a contract to continue porting its software to Itanium computers for as long as HP sells Itanium computers. Therefore, Oracle will continue building the latest versions of its database and other software covered by the judge's ruling to HP Itanium computers."
Recent investors in HP systems should be cheered by this news. You can look for new versions of Oracle software to come out for your setup on about the same schedule as the company releases software for IBM's Power systems.
It's worth remembering at this point that not only is Oracle appealing the decision that it must continue supporting HP's servers, but that the legal case itself isn't quite over. This was only the first part, to determine whether Oracle must continue supporting the servers. As Doug Henschen explains in an article for Information Week, “The second part of the legal case will be a jury trial to determine whether Oracle actually breached a contract and, if so, what damages it must pay HP. A trial date has yet to be set.”
If the court decides that Oracle did indeed breach its contract with HP, damages could be fairly significant. When Oracle announced it would stop making database software for HP's Itanium-based servers, the hardware company saw double-digit declines in its sales of those systems. HP wants $4 billion in damages, based in part on the loss of projected Itanium revenue through the end of the decade. The actual award, if HP wins, will likely amount to rather less than this, however.
In some sense, Oracle's withdrawal of support shouldn't have been completely unexpected. After a good run between 2001 and 2007 that saw something close to 200,000 Itanium-based systems sold by all vendors, sales of these machines took a nosedive starting in 2008. HP sells more X86-based servers than Itanium-based servers now. Even so, Oracle's original withdrawal of support clearly hit HP where they live; the companies count more than 140,000 customers in common, with an uncertain number on Itanium-based servers.
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