Ellison: Oracle To Keep Sun Hardware

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Ellison made the comments in a question and answer session with Reuters news service, a transcription of which was posted on the Oracle Web site and also e-mailed to Sun employees.

Oracle late last month said it planned to acquire Sun in a $7.4 billion deal announced shortly after an earlier bid by IBM to acquire Sun fell through.

Ellison said that Oracle definitely will not exit the hardware business, and that Oracle, as with successful hardware companies such as Apple and Cisco Systems, can succeed because it designs software and hardware to work together.

He cited Oracle's Exadata database appliance as an example. "Oracle's Exadata database machine runs data warehousing applications much faster -- at least 10 times faster than Oracle software running on conventional hardware," he said. "All the hardware and software pieces, database to disk, are included. You just plug it in and go -- no systems integration required."

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Ellison also cited Apple as a company that successfully designs its own chips as a reason for Oracle to increase investment in the SPARC processor line once Sun is acquired. He also said that SPARC processers are more energy efficient than those from Intel, while delivering the same performance on a per-socket basis.

While using SPARC processors can cut energy costs, Ellison said, the primary reason to keep the architecture is to build computers with the best available performance, reliability and security, and in the process increase competitiveness against IBM.

"We want to work with Fujitsu to design advanced features into the SPARC microprocessor aimed at improving Oracle database performance," he said. "In my opinion, this will enable SPARC Solaris open-system mainframes and servers to challenge IBM's dominance in the data center. Sun was very successful for a very long time selling computer systems based on the SPARC chip and the Solaris operating system. Now, with the added power of integrated Oracle software, we think they can be again."

Ellison disputed assertions that Oracle has no hardware experience, noting that hundreds of Oracle's engineers came from systems companies such as Hewlett-Packard and IBM. "Even I started my Silicon Valley career working for a hardware company that worked with Fujitsu to design and build the first IBM-compatible mainframe," he said.

At any rate, Sun itself manufactures almost none of its own hardware, preferring instead to outsource manufacturing to companies such as Flextronics and Fujitsu, he said.

Oracle also plans to keep and invest in Sun's disk storage and tape backup business, Ellison said. "We believe the best user experience is when all the pieces in the system are engineered to work together," he said. "Disk storage and tape backup are critical components in high-performance, high-reliability, high-security database systems. So, we plan to design and deliver those pieces too."

Ellison also squashed speculation that Oracle will move its Exadata database appliance, currently built in conjunction with HP, to the SPARC Solaris platform.

"We have an excellent relationship with HP that we expect to continue," he said. "The Exadata database machine delivers record-setting database performance at a lower cost than conventional hardware. Customers love the machine."