Mega-mergers bring benefits to IT departments

Fewer apps means easier management, says Frank Hayes

Remember when Oracle was a database vendor and Sun Microsystems sold workstations? Yes, you can still buy Oracle 11g or a Sun Ultra. But last week's big deals — Oracle's US$8.5 billion (NZ$10.9 billion) buyout of BEA Systems and Sun's US$1 billion deal for MySQL — remind us that the days when vendors used to fit into tidy niches are long gone.

They should remind us of something more fundamental, too.

On the surface, both deals just look like more IT industry consolidation. In Sun/MySQL, Sun gets the open-source database it's been hunting for since early 2005, plus some 10 million customers, 20% of whom already use Sun hardware. MySQL gets funding to grow. And potential MySQL customers get a big vendor to stand behind the product.

In Oracle/BEA, Oracle gets BEA's customers and revenue. BEA's customers get to be friends with all those PeopleSoft, Siebel and JD Edwards customers they'll share the corral with. BEA itself gets an end to its head-scratching search for an identity. (It's a transaction processing company! It's an application server company! It's a service-oriented architecture company!).

But there's something else going on here — something very good for corporate IT.

It wasn't that long ago when both Oracle and Sun made parts. Sure, they were best-of-breed parts, and you could use them in assembling one heck of a datacentre. But you needed lots of other parts too, from lots of other vendors. Putting them together was lots of work. And when things went wrong, there was lots of finger-pointing.

If, instead, you wanted the whole stack, you went to IBM. OK, or maybe Digital or HP or Unisys. But IBM dominated the datacentre, and it had since the days when "data processing" meant running cartloads of punch cards through collating and tabulating machines.

Those punch cards held customer data, and that data was at the centre of the company's information infrastructure.

Fast-forward through tape and drum and disk storage, through mainframes and clusters and server farms, through proprietary networks and intranets, through paper reports and terminals and PCs — and customer data is still at the centre of your company's information infrastructure. It's not just the centre of IT; it's the centre of your whole business.

Oracle figured that out a few years ago — that a database alone isn't enough. That's why Oracle has been acquiring all those enterprise applications vendors, building out from the customer data at the centre. BEA pushes things just a little further.

For Sun's part, it started with networking (remember "The Network is the Computer"?) and then added Java to build out in the application direction. With MySQL, Sun can finally reach all the way in to support customer data.

See what they're doing? Oracle and Sun now know that making parts isn't enough. Sure, they want to grow and expand their revenues and customer bases. But more than that, they want to cover everything between that critical customer data and the people who'll use it to do business.

They'll cover that stack differently from each other, and differently still from IBM, HP, Microsoft and other enterprise vendors. And each different approach means more choices available for us.

That's good to know. And this is good to remember: What IT does is still all about customer data. Not algorithms, not protocols, not dandy hardware or gee-whiz software. They're all important, but in the end, what the business depends on IT for is that customer data at the centre.

Oracle and Sun won't forget that. We shouldn't either.

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