IBM said its Migration Factory program continues to pay big dividends as the computer giant reported a record number of new customers last quarter from competitors HP and Oracle.
A quarterly record 286 customers migrated to IBM (NYSE: IBM) Power Systems from competitors in the third quarter, including 172 from Oracle/Sun and 95 from HP, the company said. IBM also said it set a record for the first three quarters of 2010 with almost 800 migrations, over 200 more than all of 2009.
All told, IBM said it's won over more than 1,500 competitive "displacements" to IBM Power from Oracle/Sun and more than 1,000 from HP since it began the Migration Factory program in 2006.
The news comes at a time when longtime alliance between HP and Oracle (NASDAQ: ORCL) has taken hits on several fronts, dating back to Oracle's decision last year to get into the systems business with the acquisition of HP rival Sun Microsystems.
More recently, Oracle CEO Larry Ellison pointedly criticized HP for firing its CEO Mark Hurd over charges that included improper expense accounting and then hired Hurd as a co-President of Oracle.
Relations between the two firms have been further strained as an offshoot of Oracle's high profile trade secrets case with SAP (NYSE: SAP) after Oracle subpoenaed former SAP co-CEO Leo Apotheker to be a witness. Apotheker was hired by HP to replace Hurd as CEO but HP has so far refused to make him available to testify, noting he already gave a lengthy video deposition back in 2008.
Analyst Charles King said it's not unusual for big IT firms to compete hard and publicly squabble, but the Oracle and HP drama has reached a new level with potentially dire consequences for both firms.
"IT companies are all ambitious, but the level of rancor and lengths to which Oracle has criticized HP in the SAP litigation and how long it's gone on is very unusual," King, principal analyst with Pund-IT, told InternetNews.com.
"If I'm an enterprise with sizeable investments in HP and Oracle, and there are a lot of those companies out there, you have to start wondering how these guys are going to work together after the dust settles," added King. "Will I get the same level of assistance and cooperation I've come to expect, or will all this bad blood spill over?"
An Oracle spokesperson said the company had no comment on IBM's claims.
HP pointed to the success of its own migration programs.
"HP has several migration programs across the globe, all using a single HP Migration Center that leverages best practices, resources and technologies to speed customer migration," Lorraine Bartlett, vice president of worldwide marketing and strategy for business critical systems at HP, said in an email to InternetNews.com
"Our IBM POWER alternative program is clearly working -- the proof is in the IDC numbers which shows HP wins big over IBM," she added. "Bottom line success in the competitive migration game is total server revenue and the latest IDC YoY server tracker results are fairly stunning. HP picked up an impressive 8.3 points of share relative to IBM (HP up 3.9 percent to 32.5; IBM down 4.4 to 29.8 percent)."
IBM started the Migration Factory program in 2006.
King pointed out that all three companies, HP, IBM and Oracle, regularly gain customers at one another's expense.
"There's a lot of back and forth; IBM gains customers and loses others," said King. "But what's interesting about the Migration Factory is that it gives IBM a soapbox to talk about its customer wins and where they are making gains. It's an effective megaphone for them."
Technicians in Endicott, N.Y., dismantle used Sun servers returned to IBM as part of its Migration Factory Program.