What happens with Oracle?

After a couple of recent discussions about Oracle, I tried to analyze the company's position and the processes in it. In short, it turns out that Oracle is experiencing serious difficulties, as it is filing lawsuits against competitors, without evidence.

First of all, this can be seen in the lawsuit that Oracle filed against IBM against misleading advertising of its Exadata database machines. Roughly speaking, Oracle stated that its software works 20 times faster, comparing some ideal configuration on a modern customer’s equipment with the average abstract configuration of IMB. Below are the details, but it's like comparing a Formula One car and an SUV, saying that an SUV is 20 times faster in the forest.


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The National Advertising Association (USA) has already rejected the lawsuit, but Oracle is going to appeal this decision.

Symptomatically change priorities for solutions in several areas:

• A company becomes less discriminating in its advertising claims, especially when its products become uncompetitive. In principle, it is logical: it is impossible to compete “as is”, we must take the opportunity to press a competitor in court and gain time, which will allow to get a little more profit.
• It creates, at first glance, attractive pricing plans, but customers complain that in fact they pay a lot more than stated in the plans. This is confirmed in discussions on the American forums. Who works with the company's products, please write in the comments, if it touched you.
• Marketers have become very active, with few facts, and many promises. This can speak either about big secret plans (which is doubtful) or about the difficulties of the company. Theoretically, a company in this situation may begin to make wrong decisions, tormenting including its customers, turning away from the main users and trying to attract new customers.

In my opinion, the main problem of Oracle is that its new hardware division works poorly, as indicated by its own Oracle vendors.

In addition, after buying Sun, Oracle got rid of Sun's financial director and put a loyal person on that place, which, it seems, does not concern end customers, but definitely will cause a resonance among investors.

A major miscalculation of Oracle is the deterioration of relations with HP, which allowed Oracle to really compete with IBM. In fact, after losing HP, Oracle will no longer be able to compete with IBM. Sun purchase did not help Oracle, but on the contrary, worsens its position. As a result, Oracle will have to fight alone with both HP and IBM, apart from the fact that EMC, Cisco and SAP are merging.

In order not to be unfounded, I give below a translation of a rather illustrative story, which served as a starting point for me in this search ( proof ).

Oracle withdraws its advertising claims regarding Exadata after an IBM complaint

The Boston IDG news bureau reports that the press release of the self-regulating industry organization National Advertising Association, which it released on Tuesday, says that Oracle is recalling its advertising claims that the performance of its Exadata database machines is many times higher than hardware performance of Power Systems machines manufactured by IBM.

IBM challenged Oracle’s claims in an advertising in the Wall Street Journal. According to the National Advertising Association, the text of the advertisement read that “Exadata machines being 20 times faster ... again replaced IBM”, and also that “a huge European retail chain moved its databases from IBM Power to Exadata ... which work 20 times faster".

In its appeal to the association, IBM challenged Oracle’s statement that [Oracle machines] were 20 times faster than Power Systems machines, noting that it was too general.

In its press release, the association noted that Oracle, however, described its advertising as an example of implementation, describing the experience of an individual customer. In addition, the vendor said that "an enlightened target audience" would understand this nuance.

The association ultimately took the side of IBM, deciding that “at least one reasonable interpretation of the disputed advertisement is that all Exadata systems or their overwhelming number are consistent, work in all or in many aspects 20 times faster than all IBM Power systems or their overwhelming majority. ” The press release also states that “the evidence presented did not substantiate this statement.”

Despite the fact that Oracle has agreed to stop this advertising, it also plans to challenge the decision of the association, which recognized the advertising "inappropriately generalized."

Oracle spokesperson was not available for immediate comment.

Jeff Cross, spokesman for IBM, said in an interview that the company was pleased with the association’s decision. “This comparison was hardly acceptable,” he added. Apples and uncle in Kiev. They compared the Exadata machine and Power Systems, which has been in production for 6 years. ”

Exadata machines were first introduced in 2008. Oracle software is combined with server hardware and Infiniband network adapters.

Cross also notes that the Exadata system uses the Oracle 11g database management system, while the customer on Power Systems used an earlier version - 10g.

In an argument between Oracle and IBM, one expert took a neutral stance.

“All parties are to blame for this kind of exaggeration,” said Kurt Monash, a database analyst at Monash Research. But a little more blame is still on Oracle. ”

“If your new system cannot significantly surpass someone’s old system even in a few queries [to the database], then you are doing something wrong,” he added. Use a newer or better “iron”; use newer or better software! Assign performance tuning to an authoritative specialist, and then you will achieve excellent performance indicators! ”

Over the past few months, this is the second decision made by the National Advertising Association in favor of IBM and against Oracle. In April, the association recommended Oracle to stop advertising, in which it indicated prices and announced performance, comparing its Oracle SPARC SuperCluster T4-4 computing system with the rival IBM platform.

According to the National Advertising Association, Oracle did not agree with all the arguments of the association, but refused to advertise.

In my opinion, if Oracle does not change the line of conduct, then everything will end very badly for it. Either the company will need a new major ally, or something that abruptly (for a year or two) will give priority over other market players in the development. Otherwise, even with perfect marketing, which, admittedly, is really very strong, the company will lose customers faster and faster.