Feeds

Analysts see no Oracle hardware-biz recovery on horizon

Sun sinks slowly in the west

Boost IT visibility and business value

The road ahead for Oracle's plucky band of hardware resellers in not certain say analysts.

The admonition comes in the wake of Oracle's latest numbers which show that software licensing and support revenues rose in its third quarter but hardware and systems support fell 16 per cent and and four per cent respectively.

Commenting on the numbers, Canalys boss Steve Brazier, said the extent to which Oracle had "shrunk" the Sun server biz since the acquisition is "quite astonishing" and the reason is that "they don't understand the channel".

"They [Oracle] put direct people from the software business in charge of hardware channels. Its clearly not working, the business is sinking quickly," he said.

Brazier added there was "no sign" of Oracle recognising and reversing this trend and claimed the boil first began festering on the day Oracle completed the acquisition of Sun when Larry Ellison said it was taking dealer accounts direct.

"It hasn't gone well since then. The rest of Oracle's business, the Right Now acquisition, is doing very well as a software company as it has always done but the hardware business is in crisis and will be difficult to turn around," he added.

Oracle has posted year-on-year declines in sales and revenues for seven of the eight quarters since it acquired Sun Microsystems, according to abacus stroker IDC.

Nathaniel Martinez, programme director for server research EMEA at IDC, told The Reg that resellers were being marginalised by Oracle and the direction of the company suggested it will "pull out of the hardware channel".

He said it may keep some larger systems sellers at the very high-end of the market but the "volume side is a dead end".

Mike Norris, chief executive at Computacenter, said the only reason Oracle would completely dismantle the hardware channel was if its pulled out of system space but some strategic thinking was required to fire up systems sales.

"To be successful in hardware Oracle needs to engage with the channel more effectively and sort out the direct issues," he said.

Oracle did not respond to calls for comment. ®

Boost IT visibility and business value

More from The Register

next story
Pay to play: The hidden cost of software defined everything
Enter credit card details if you want that system you bought to actually be useful
HP busts out new ProLiant Gen9 servers
Think those are cool? Wait till you get a load of our racks
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
Community chest: Storage firms need to pay open-source debts
Samba implementation? Time to get some devs on the job
Like condoms, data now comes in big and HUGE sizes
Linux Foundation lights a fire under storage devs with new conference
Silicon Valley jolted by magnitude 6.1 quake – its biggest in 25 years
Did the earth move for you at VMworld – oh, OK. It just did. A lot
prev story

Whitepapers

Gartner critical capabilities for enterprise endpoint backup
Learn why inSync received the highest overall rating from Druva and is the top choice for the mobile workforce.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.