Raleigh, North Carolina-based Red Hat’s chief executive, Matthew Szulik, has written to the Financial Times in response to a recent interview with Ellison in which Ellison suggested the company would be interested in distributing and supporting Linux.
Is it possible that the dominant provider of databases feels pressure from its long-time partner, Red Hat, because of our recent purchase of an open source middleware company, JBoss? Szulik asked, although he also played down suggestions of a showdown between the two companies.
Oracle generates more interest income than Red Hat generates in annual revenues and Red Hat’s planned acquisition has little to do with future strategies to enter an already commoditized database market, he added.
While Szulik might be playing down a confrontation between the two companies, that description of the database market will likely have done little to improve Red Hat’s position in Oracle’s eyes, and it is undeniable that the two companies are now competitors when it comes to Java middleware.
Red Hat’s acquisition of JBoss begins Red Hat’s migration up the infrastructure-software stack and leads it into direct competition with Oracle and IBM, two important partners of Red Hat, noted Goldman Sachs recently as it reduced its investment rating on Red Hat.
Oracle, in particular, seems likely to align with a competing Linux distribution in an effort to deliver a bundled, integrated, open source infrastructure stack of its own, it added, even before the publication of the FT’s interview with Ellison, in which he admitted that the company had looked at acquiring Novell Inc.
Ellison also went on to explain that the open-source model would make the acquisition of Novell or Red Hat unlikely – We buy Novell, IBM says thanks very much, takes the source code and boom, there goes all our money down the drain on day one, he said – but while Novell has not responded directly to speculation about an acquisition, the company is clearly interested in making the most of any rift between Oracle and its rival.
I think they’re a friend of open source, and through their actions they’re earning their participation in the benefits of open source, said Novell’s chairman and chief executive, Jack Messman. We have a good relationship with them and I think that the Red Hat/JBoss deal will cause us to have an even closer relationship to them, he added.
That would certainly seem likely given Szulik’s letter to the FT, in which he welcomes Ellison’s suggestion that the company might enter the Linux business as more public contribution from the larger proprietary software industry before accusing that industry of failing to serve its customers.
I believe the technology industry has entered an era where the customer, an asset taken for granted by many technology companies during the past 30 years, has moved front and centre in the Internet, he wrote.
The absence of lock-in due to open source software has created a new competitive period where innovation and value added replaces the lack of alternative created by the proprietary walled gardens of software vendors, he added, before comparing the US software industry to the US automotive industry and open source vendors to Japanese car makers.
While not exactly a declaration of hostility, the letter is provocative given the change in relationship between Red Hat and Oracle noted by Goldman Sachs. Ellison had the first words with his statement that they’re not supporting the customers very well, now Szulik has responded.
Seems we have not heard the last of this.
