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August 02, 2012

HP wins lawsuit ruling against Oracle

PartyhatsAfter more than a year of accusations, secret document dumps, and a glut of suits and countersuits, HP has a victory in its lawsuit against Oracle to save the Itanium servers. Hewlett-Packard didn't paint the suit in the Superior Court of Santa Clara County California as a battle for Itanium's future. But in winning the ruling from Judge James P. Kleinberg, HP will force Oracle to keep selling and porting its database for Itanium servers. Oracle believed that a clause in a lawsuit which settled hiring away Mark Hurd didn't force Oracle to stay in the HP market.

Oracle said it will appeal the ruling immediately. The next step of the lawsuit is to bring the matter in front of a jury to determine damages Oracle must pay HP. Hewlett-Packard estimated it would have lost $4 billion in HP-UX and Integrity business if Oracle had won. Much of it was calculated in support fees.

Legal and industry analysts, as well as members of the 3000 community, are not completely convinced this settles the future for Oracle on Itanium. The judge noted that Oracle and HP were once close partners. Kleinberg noted in his ruling that both companies made a lot of profit for many years working together. It all began to unravel in the spring of 2010, after the former HP CEO Hurd was cleared to take a systems leadership job with HP's rival Sun/Oracle.

Oracle must port its products to Itanium servers without charge, the judge ruled. Oracle said it decided to dump Itanium and HP-UX because it believes the chip is approaching its end of life. Oracle didn't say that about HP-UX. But the operating system only runs on Itanium servers by now, unless a company's got older, PA-RISC-based servers.

Alan Yeo of Screenjet, a provider of tools and services to modernize legacy interfaces on the 3000, believes HP isn't going to extend the HP-UX lifespan very much as a result of a court ruling. "HP don't want to be in the operating systems business anymore," he said yesterday. "That's not where they're going."

Some members of the 3000 community are saying that it's very new and untested law to force one company to do business with another. "Forcing parents to stay together for the sake of the kids normally isn't a good idea," Yeo added. "Neither, I suspect, is compelling companies to be business partners." He thinks an exit strategy for Oracle-Itanium users is in order.

On a Wall Street Journalreport about the outcome, several commenters noted that Oracle has other means to keep its database out of Itanium/HP-UX IT centers. "The court may order Oracle to provide software and support, but there is nothing against pooling high-schoolers in Itanium support centre," said Mike Kichton.

"The court may be able to force Oracle to support Itanium," said another commenter, "but they can't make them do it well."

Inside HP, confidence remains high about the prospects for Itanium -- and by extension, HP-UX. Even while HP insisted that Oracle was bound to its promises to support Itanium, HP began to promote Postgres SQL as an alternative. The doubt and battles over the future of the database which is the most often installed on HP-UX have cost HP millions of dollars already. In the quarterly report from this year's Q1, HP's CEO named the Oracle battle as a factor in a 27 percent decline in the Business Critical server business, the group selling servers that run tanium chips. BCS numbers continued to drop in Q2.

The judge's ruling will be of no help for the BCS Q3 sales, which ended the day before the court edict was announced. HP called the ruling "a tremendous win." 

Today’s proposed ruling is a tremendous win for HP and its customers. The Superior Court of the State of California, Santa Clara County, has confirmed the existence of a contract between HP and Oracle that requires Oracle to port its software products to HP’s Itanium-based servers. We expect Oracle to comply with its contractual obligation as ordered by the Court.

HP summarized the court's order in a brief statement on its Newsroom website.

09:12 AM in Migration, News Outta HP, Newsmakers | Permalink

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