Sunday, May 26, 2024

EMC, Cisco, and SAP HANA — And Oracle Collateral Damage

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The recently announced partnership between EMC, Cisco, and SAP for big data real time analytics package HANA looks to be one of the most powerful big data analytics moves this year. Recently I sat down with executives from these three companies to talk about why they had formed an alliance and what it meant for existing and potential SAP customers.

What is also clear is that some of the collateral damage from Oracle buying Sun includes vastly stronger partnerships between Oracle’s traditional competitors and some of their one-time partners – stronger partnership -than would likely have existed had Oracle not made this move.

This collateral damage to Oracle is actually good for IT buyers because it assures competition as Oracle moves to lock them in to Oracle only solutions.

Let’s look at this interesting partnership and what is driving it.

EMC: Partners ’R Us

Before Oracle bought Sun, EMC had already stepped out with the establishment of both a relatively unique acquisition process and the first technology virtual corporation VCE.

Their acquisitions of RSA and VMware, unlike other traditional acquisitions, didn’t blow up the acquired companies but appeared to enhance their value – unusual in a market that traditional did integration mergers which destroyed the value of the companies that had been purchased.

As more and more companies went down the traditional path of becoming ever more complex and horizontal, EMC doubled down, forming VCE between Cisco, VMware, Intel and themselves to create a competitive alternative without destroying the tight focus these companies had on their relative market.

In effect, in a world where best of breed hadn’t worked, EMC found a way to make it work.

More recently EMC put together VSPEX a unique offering that created a powerful partnership with distributors like Ingram Micro and placed their testing labs on top so the result would be competitive with a direct offering. As a result, rather than bouncing off the mid-market, EMC had the favored solution.

And now EMC has formed an alliance with Cisco and SAP to create a unique HANA appliance that reduces substantially the complexity, cost, and implementation issues surrounding this powerful technology.

SAP/CISCO/EMC Big Data and the Private Cloud

While SAP’s big data real time analytics package HANA is at the core of this partnership, it anticipates big private cloud projects as well. While SAP is often thought of as a CRM/SFA vendor they have expanded into a full suite provider and their powerful HANA engine is being used far more broadly.

One of the cases we discussed was the adoption of this platform by a large supplier of pacemakers. They use this to monitor the performance of a massive number of pacemakers to make sure problems are identified before they become catastrophic; product repairs save lives. Older systems were simply too slow, putting patents at risk, with HANA the firm was better able to stay ahead of the problems and address many more issues before they became life threatening.

The full Medtronic Customer Testimonial can be found here.

Sun/Oracle Collateral Damage

You can see in the tone of the comments surrounding this partnership that these companies are now focusing their collective efforts to displace Oracle accounts. It’s analogous to connecting the company and its founder to legendary James Bond villains and drawing the connection between Larry’s purchase of the Hawaiian Island and the island bases (I’m thinking Dr. No) that these villains often seemed to occupy.

This is more than just rhetoric, though. Oracle’s purchase of Sun has polarized the large IT companies and virtually all of them are now in agreement on one thing: that Oracle accounts are unusually vulnerable and attractive. They aren’t spending a lot of time on each other but IBM, HP, SAP, EMC, Cisco among others are coming at Oracle in new and creative ways and their combined resources are impressive.

This is the cost of acquiring Sun that I don’t think Oracle fully realized and it adds significantly to the cost of this purchase and serves as a cautionary tale for other vertical companies that decide to go horizontal.

Wrapping Up

Post Sun merger the large scale IT market appears to be reforming into one that is sharply divided between Oracle and the firms that want to put Oracle out of business.

This acquisition appears to have strengthened competitors like SAP through more powerful partnerships like this recent HANA instance, switched partners like EMC and HP to competitors, and put long time competitor IBM into of field of firms which are seemingly similarly focused on destroying Oracle.

This not only emphasizes the collateral damage and opportunity cost of the Oracle/Sun merger and makes it look exceedingly foolish in hindsight, but creates better alternatives for Oracle products in competitors who are ever more willing to deal. This last means if you want off of Oracle, there has never been a better time nor more choices or focused vendors to help you out.

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