EU gets it — finally

Posted: January 21, 2010 in Current Affairs, Economics, Technology
Tags: , , , ,

Approves Oracle’s acquisition of Sun

The bureaucrats in the EU finally stopped looking through the wrong end of the telescope long enough to approve Oracle’s purchase of Sun Microsystems. The deal had been held up for months while the EU tried to decide if the acquisition, which included MySQL, a database product bought by Sun in 2008, would have a deleterious effect on innovation in the database market.  They finally decided it would not.

As a practical matter, innovation in the database market peaked many years (decades?) ago when the market began to consolidate around Oracle and the seven (or three, whatever) dwarfs.  The market took care of trimming the number of databases and market demand did the rest, forcing Oracle and IBM (DB2) to develop more and better product features over time.

I am not so much of a free market enthusiast to think that everyone is a rational player (we humans are no such thing) and that the market always produces the best result — Voltaire’s Dr. Pangloss put a permanent hole in that hull.  But I do believe, in this case at least, that Oracle and Sun have a clear understanding of the economic forces that are driving them into the first (?) hardware-software consolidation in the industry.

True enough, IBM is and has been a formidable supplier of gear, software and services.  But absent any initiative to break up Big Blue, I can see no justification for holding up the Oracle-Sun merger.  So now the merger proceeds and the bigger question will be how Hewlett-Packard responds.

So, what did you think?

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