EU Gives Larry the Go Ahead

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EU Gives Larry the Go Ahead

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Oracle's proposed acquisition of Sun Microsystems received the seal of approval from the European Commission this week following Oracle CEO Larry Elllison's diplomatic efforts in December. EC chair Neelie Kroes was singing a different tune in the Commission's press release, saying that she was not only satisfied that competition in the database market would be preserved, but that "Oracle's acquisition of Sun has the potential to revitalise important assets and create new and innovative products."  Sources expected the approval to come on Tuesday, but there's a surprising reason behind Neelie Kroes' delays.  A certain boat race might be Larry Ellison's motivation for getting the deal closed by February 8th. 

First, the commission assuaged any fears about the safety of Java.  They concluded that Oracle would be very limited in any attempt to deny competitors access to Java technology.  The function of the Java Community Process (JCP) ensures Java's openness.  In regards to the database market, the commission said that Oracle would still have stiff competition from IBM and Microsoft in the database market.   Although MySQL's revenues were low, the EC said that it initially felt that it needed to investigate the acquisition of the leading open source database and the extent to which it competed with Oracle.  Along those lines, the commission concluded that Oracle and MySQL do compete in certain parts of the market, but that they are not close competitors in other areas like the high-end database segment.

Even though the commission seems confident that Oracle will continue the evolution and innovation of MySQL, they believed that PostgreSQL could replace the competitive force of MySQL if Oracle took MySQL down a less-open road.  The EC also acknowledged that it is "legally possible" to produce MySQL forks that might provide competition as well.  The ten pledges to customers made by Oracle in December seemed like the turning point in EU sentiments.  The EU said that Oracle has made binding offers to third parties that already have a licence contract for MySQL.  However, the legal assurances behind some of the other pledges are tenuous.  Commission spokesman Jonathan Todd said that Oracle's pledges were not the primary motivations behind the approval.  "They [the pledges] are taken into account as one of several factors," he said.

The anti-trust battle may not be over for Oracle.  Russia recently opened their own investigation of the Oracle-Sun deal and China might be an issue as well.  In their own press relase, Oracle said that they don't expect any trouble from Chinese and Russian regulators.  Monty Widenius, a founder of MySQL and author of the "Save MySQL" petition (which has over 30,000 signatures now), has not commented on the final approval, but his sentiments were clearly defined in a previous blog post: "Should Oracle get MySQL unconditionally, then I can only say that as a European I am ashamed of our regulatory system.”

Maureen O'Gara of SYS-CON News says she knows the real reason why the approval didn't come through on Tueday, when it was expected:
"...when it didn’t happen Tuesday like it was reportedly supposed to we asked why not and were told – you’re gonna love this – that it was because antitrust czarina Neelie Kroes screwed up her confirmation hearing last week as Europe’s Digital Agenda commissar and didn’t want to upset her chances of getting the job by waving through an acquisition that is increasingly unpopular with the digital agenda constituency by underscoring the EC’s toothless response to it, or so they say."

Oracle says you won't want to miss their webcast on January 27th, where they, along with Sun, will outline their plans for the merger.  Ellison wants to have the deal closed and announced before February 8th.  That's when the America's Cup sailing race starts, and Ellison probably doesn't want any distractions while he's racing in his Oracle-sponsored boat.

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