What next for Oracle and Sun?

Oracle has yet to decide what to do with all of Sun's assets

Oracle announced today that it is to buy Sun Microsystems for around £5bn, but although analysts generally agree that Java and Solaris have a safe future, they are divided over what the acquisition could mean for Sun's other products.

In a webcast to announce the deal, Oracle chief executive Larry Ellison praised Solaris as "by far the best Unix technology available in the market", and said the Java platform was also key to the decision to purchase Sun.

"Oracle's Fusion middleware is based entirely on Sun's Java language and software," he explained.

"As a result of the acquisition Oracle can increase the investment in Java technology that is so critical to our continued success in middleware and the next generation of Fusion applications."

The surprise deal leaves Oracle with a significant number of open-source assets, especially in the middleware area – a situation that will be interesting to follow, according to Rob Hailstone, practice director for software infrastructure at analyst Butler Group.

"Oracle has not been visible in doing anything to promote the open-source acquisitions it has made [in the past]," he said.

"In order to exploit open-source middleware it may have to change its business model from a licence-based one to maintenance-based."

Hailstone added that several Sun middleware products overlap with technology Oracle acquired when it bought BEA last year. "This leaves the interesting question of how it's going to explain this away, or consolidate or run two separate development paths that make sense," he argued.

More positively, David Mitchell of analyst firm Ovum argued that Oracle would be able to fit Sun's services business "nicely into the Oracle product support line of the business", while the MySQL asset would give it an even more powerf ul position in the database market.

Mitchell also predicted a secure future for Sun's flagship Solaris operating system, and said Oracle could use its new-found reach through the hardware and software stacks to market a series of pre-built specialist appliances loaded with a combination of Solaris or Linux, and preconfigured with Oracle software.

"It's good news for Sun; Oracle has a good track record for making acquisitions and then sweating value out of them," he said. "But there's a lot of hard work to do behind the scenes."

Another bonus for Oracle will be the reach that the Java platform gives the firm in the embedded market, argued Mitchell.

Butler Group analyst Michael Azoff said the acquisition would be good for the future of Java, but argued that the deal may be more backward than forward looking.

"I'd have to say I view it in the context of the old world," he said. "The new world is all about cloud computing but this is definitely consolidation of the old world."

Others predicted a more rocky time ahead, for customers and employees. Tony Byrne, founder of analyst CMS Watch, argued that the culture clash between the two companies may be telling.

"I think you'll see a definite culture clash, as the easy-going Sun folks meld with the hard-nosed Oracle culture. Sun is the sort of place nice people go to work for, usually knowing full well what life is like at the Oracle HQ up the road," he wrote in a blog posting.

"If you're a Sun customer now, you can likely expect to be dealing with more aggressive salespeople and tougher contract negotiations. Steel yourself accordingly."