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Oracle hardware: It is a mystery

It’s really not news that Oracle sales people go into a discounting frenzy at the close of the fiscal year. And, that discounting has netted Oracle some Exadata deals in its fourth quarter ending May 31. At least one buyer was a large financial services company that had previously discontinued any future Oracle-Sun hardware purchases.

What remains to be seen is if the big–and even after discounts they are big– hardware deals will make up for the rank-and-file Sun server customers deserting the company. Give Oracle credit though. CEO Larry Ellison has said for a year and a half now that he doesn’t care about commodity hardware and by golly, he’s proved it. There is an off chance that Oracle president and resident “hardware guy”  Mark Hurd will reemphasize plain-old Sun X86 and Sparc-based servers, but don’t bet the ranch on it.

Still some of these fourth-quarter Exadata deals bear looking into. NetSuite bought Exadata in a move that apparently moved Oracle’s share price.  Here’s some verbiage from NetSuite’s release:

NetSuite “is working with Oracle Corporation to leverage the power of the Oracle Exadata Database Machine for NetSuite’s cloud software solutions. By becoming an Oracle Exadata customer, NetSuite can deliver extreme levels of performance and other benefits to NetSuite customers to power their business growth.”

Wow. Sounds impressive. However, it appears from a May 13 8-K filing that what NetSuite bought was a single quarter-rack Exadata X2-2 HP box. For the record, that’s the smallest Exadata one can buy. The price was $432,100 including $55,000 for annual support and maintenance. 

Given that Ellison owns about half of NetSuite, the deal had to be disclosed. Whether a half-million-dollar sale into company co-owned by the seller’s CEO should boost the seller’s share price is an interesting question.

There was another rumor that, another company that spun out of Oracle’s orbit, bought a pantload of Exadatas. If true, that would be a blockbuster, given the public thrashing CEO Marc Benioff gave Exadata last September.  Benioff, sharing a stage with Michael Dell, noted that preferred to use lots of reliable, standard Dell servers to run its services and mocked Ellison’s notion that Exalogic (the little brother of Exadata) was really “cloud in a box.”

Asked this week whether had, in fact, gone X-crazy, Benioff let it fly via email:

“We’re 100% Dell. That’s 100% cheaper. Higher quality, easier, and open. Just like Facebook, Google, et al. is doing. No different. There is no internet service to my knowledge using exadata proprietary mainframes to deliver billions of transactions to customers. Our architecture is based on standard pc architecture. Commodity systems. Our uptime is at Does that help?

Stay tuned for Oracle’s earnings call June 23, for more information on Exadata/Exalogic momentum.

Let us know what you think about the story; email Barbara Darrow, Senior News Director at [email protected].

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