Oracle's Decade of Acquisition: Innovative or Just Well-Financed?

CEO Larry Ellison's "about face" on acquisition strategy, beginning with the hostile takeover of PeopleSoft in 2003, kicked off a decade of unprecedented software vendor consolidation, altering the marketplace for customers and vendors alike.

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All Done or Just Getting Started?

Oracle would love to close out the year by finally closing out the Sun Microsystems deal and ending the rancor in the European Union and among MySQL devotees. Ellison said at one point this fall that Sun was losing $100 million a month. (Oracle media relations declined to make an executive available for this story.)

Ovum's Wilson categorizes Oracle "more as aggressive and opportunistic than innovative." With Sun in its stable, though, Oracle will become an even stronger force and bigger presence in companies' IT departments. "If its Sun acquisition goes through and succeeds," he says, "it will have a complete, integrated hardware and software stack for the first time—so it's an 'innovation' for Oracle but not in the industry, as the single-stack used to be common, though relatively uncommon in the past several years."

What's also important to note, says Altimeter Group's Wang, is what Oracle has not done with its acquisition strategy during the past decade: bungled it. "They learned their lessons on what not to do in an acquisition," he says, pointing to CA and Geac as vendors that have not realized as much success.

If Oracle is still hungry to acquire in 2010, then there are always more companies and products to purchase. (See Forrester figure below.)

Forrester Research figure

Ellison & Co. have been called many things during this past decade, but in the minds of Ellison and his cohorts, Oracle's acquisition strategy has been all about being "innovative"—whether you agree with him or not. "When you innovate," he has said in the past, "you've got to be prepared for everyone telling you you're nuts."

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Copyright © 2009 IDG Communications, Inc.

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