— Groklaw, on Google’s big win over Oracle
Patents and software need to get a divorce before somebody gets hurt.
After listening to Mr. Lynch’s PowerPoint slide sales pitch to sell Autonomy to Oracle, Mr. Kehring and Mr. Hurd told Mr. Lynch that with a current market value of $6 billion, Autonomy was already extremely over-priced. The Lynch shopping visit to Oracle is easy to verify. We still have his PowerPoint slides.
OMG. The Oracle-HP rivalry is about as nasty as Yankees-Red Sox (better luck next year, Boston!) or Ohio State-Michigan.
The above quote is from a press release that Oracle audaciously put out Wednesday night accusing the CEO of British software firm Autonomy of either “lying” or having a “very poor memory.” HP agreed to buy Autonomy for more than $10 billion. It was one of the last moves made by HP CEO Leo Apotheker before he was canned and replaced by Meg Whitman.
But Oracle, in all its awesome Ellison-ness, decided to rub salt in the wound by declaring that Autonomy tried to sell itself to Oracle first and that Oracle turned the deal down, citing the fact that Autonomy was already overpriced at $6 billion.
Oracle claims that Lynch and Autonomy banker Frank Quattrone met with Oracle’s head of M&A and president Mark Hurd. You may have heard (ha!) that Hurd used to be the CEO of HP before Apotheker.
Oracle even gave the date and time of the meeting … which was … wait for it … April Fool’s Day! That’s rich. And it only gets better.
After Lynch came out late Wednesday and admitted to remembering that he did meet Hurd, but only to discuss database software issues, Oracle put out another press release early Thursday. That one was titled “Another Whopper from Autonomy CEO Mike Lynch.” And that release included links to a page called Oracle.com/PleaseBuyAutonomy. That page has the aforementioned PowerPoint presentations. Unbelievable!
All this comes as the The Wall Street Journal reports that HP has hired Goldman Sachs to protect it from activist shareholders. But based on Oracle’s latest offensive, I think that the likes of Carl Icahn are the least of HP’s worries right now. — Paul
Oracle chief financial officer Jeff Epstein, who’s only been on the job since September 2008, resigned suddenly Monday afternoon. Fortunately for Oracle CEO Larry Ellison, the right person to take over is already working for Oracle.
The software giant quickly named Safra Catz, who was CFO before Epstein, as the new permanent CFO. Catz is also a co-president at Oracle, serving alongside fellow co-president Mark Hurd. Hmm. Where have I heard that name before?
Oracle didn’t give a reason for Epstein’s departure. But considering all the executives that have come and gone under Ellison in the past 15 years or so — paging Gary Bloom and Ray Lane and Craig Conway and Marc Benioff and Tom Siebel and Harry You and Greg Maffei and billboard sensation (not in a good way) Chuck Phillips — it should come as no surprise that Epstein was leaving.
Strangely, Oracle’s stock fell more than 1% after hours on the Epstein news. But investors should have no reason to worry since the transition to a “new” CFO as is smooth as you can get.
It’s nothing short of miraculous that Catz has not just lasted this long (she joined Oracle in 1999) but has remained Ellison’s trusted consigliere all this time.
“Safra already has the long-standing confidence of our employees, our Board and our shareholders,” said Ellison in a statement. “There is no more logical choice for CFO.”
Much was made about how Hurd could eventually take over for Ellison after Hurd was hired by Oracle last year following his ignominious exit as the head ink cartridge at HP in the wake of a sex/expense report scandal. And while Hurd does have CEO experience as a notch in his belt (keep your mind out of the gutter!) I wouldn’t completely rule out the idea of Catz one day taking over Ellison’s baby.
Of course, Ellison probably may never leave the job until he actually shuffles off this mortal coil. And who knows? Maybe Catz is content being the real power behind the scenes. Co-president and CFO? That’s about as much responsibility you can get short of being CEO.
If nothing else, Catz deserves a medal for being able to put up with the enigmatic Ellison for more than a decade. Of course, she could buy her own medal or two. After all, her $36.4 million compensation package last year is worth more than 24,000 ounces in gold at current prices. — Paul
Shares of Oracle slipped slightly after hours, despite an announcement on Thursday afternoon that earnings grew by 78% and sales rose 37% in the previous quarter.
The Redwood City, Calif.-based enterprise software giant cited several large hardware and software wins during its fiscal third quarter for the company’s strong performance. One of the more notable deals includes a multi-year contract with Salesforce.com to build most of their cloud services on top of Oracle’s database and middleware software.
“Oracle is the technology that powers the cloud,” said CEO Larry Ellison, in a statement announcing the deal.
Net income rose to $2.1 billion last quarter from $1.2 billion a year ago. Excluding one-time charges, the company said it earned $2.8 billion, or 54 cents per share. Analysts surveyed by Thomson Reuters forecast per-share earnings of 50 cents.
Revenue climbed to $8.8 billion, up from $6.4 billion last year. Wall Street expected sales of $8.7 billion.
Oracle also announced that it raised its dividend by a penny to 6 cents per share.
Co-President Safra Catz noted in a prepared statement that the company believes it will exceed the $1.5 billion profit goal it set for the Sun Microsystems business in the current fiscal year, which ends in May. Oracle completed its $7 billion acquisition of the server maker and Java owner early last year. -David
Oracle and Research in Motion announced their past-quarter financial results Thursday after the bell, and both beat Wall Street analysts’ estimates for earnings and revenue.
RIM: Don’t count RIM out just yet. The BlackBerry maker has been beaten down by investors this year, but the company raised its outlook for the current quarter and for 2011.
RIM posted record BlackBerry shipments in the quarter, sending 14.2 million devices to wireless carriers, up 40% over last year.
Sales were up 19% and profits were up 45%.
Oracle: The enterprise software giant said its fiscal second-quarter net income rose to $1.9 billion, up 28% from a year earlier. Excluding one-time charges, Oracle said it earned 51 cents per share, compared to a median estimate of 46 cents per share from analysts polled by Thomson Reuters.
Sales rose 47% to $8.6 billion, topping analysts’ forecasts of $8.3 billion.
The biggest boost to the strong results were software licenses, which soared 21%.
Watch your backs, Google and Microsoft. You’re not the only cloud-based productivity suites for the enterprise in town anymore.
All right, no one is running scared just yet, but Oracle announced what appears to be a pretty impressive product on Thursday, which could measure up nicely to Microsoft Office Live and Google Docs.
Oracle says its new Cloud Office product will work seamlessly with Open Office, just like Microsoft Office Live works seamlessly with the Office software. But it is also open-sourced, just like Google Docs.
The problem with Google Docs is that it’s not nearly as capable as Microsoft Office and it offers little tech support. But you can’t beat that $50 price or the fact that it’s open. The biggest hang-up on Microsoft is that it’s really expensive to license.
Noticing that, Oracle said it is the “industry’s first complete, open standards-based office productivity suite for desktop, Web and mobile users.
Sounds like it’s trying to out-Google Google and out-Microsoft Microsoft at the same time. But this is Larry Ellison we’re talking about, so I guess we shouldn’t be too surprised.
Google and Microsoft have been duking it out with some pretty nasty back-and-forth about who is using what online software. Both companies love to mention each time the a customer defects from one to the other. Now it’s got Oracle to contend with too.
The enterprise software company said nothing about pricing or availability. -David
Larry Ellison is it again. Oracle agreed Tuesday to buy e-commerce software company Art Technology Group for $1B, a 46% premium to where Art’s stock was trading Monday. But before you accuse Oracle of vastly overpaying, consider that the deal values Art at just $6 a share — and as you can see from the chart above, that’s a far cry from where the company was trading during those bubblicious days of 1999 and 2000.
Art was once a super-hot stock. Back in the proverbial day, any company that was billed as a business-to-business (B2B) software play was given a ridiculous valuation. Just ask Ariba. Or Broadvision. Or Commerce One. Or i2. Ahh. Strolling down dot-com memory lane is fun.
At the height of Web 1.0 mania, investors conveniently ignored the fact that the B2B market was overcrowded and not nearly as lucrative as people thought. Then the bubble burst. And it was never the same for Art.
To the company’s credit, it didn’t completely flame out. It survived even though it didn’t exactly thrive. And the Oracle purchase does show that e-commerce software, while maybe not a viable standalone business, is something Oracle needs in its software suite to truly compete effectively with the likes of SAP, Microsoft and IBM.
But I still wonder what’s next for Oracle? Ellison made waves not that long ago when he hinted the company would look to buy a semiconductor marker. And when Oracle hired ex-HP CEO Mark Hurd, people immediately speculated that he would soon start looking for storage or other hardware deals.
The Art deal is hardly the game changer we’re all waiting for. So something tells me Oracle isn’t done shopping yet. But if Oracle really wants to make a bold chip or hardware move, it’s going to have pay up. It probably won’t be able to find something from the 2000 dot-com scrap heap that’s still trading at a dirt cheap price. - Paul
Charles Phillips, the co-president Oracle kicked to the curb last month to make way for Mark Hurd, has a new gig — one with the letters “CEO” in it at last. He’s taking the helm at Infor, which the New York Times nails with this description: “The company’s claim to fame, if you can call it that, is owning the largest business software franchise no one has ever heard of. “
Infor is one of those companies that should get more attention — it has more than $2 billion in annual revenue and a giant customer base, plus 8.000 employees — but doesn’t because it’s a) privately held, and b) makes enterprise software, which is important and valuable and intensely boring, even to the poor CTOs who have to buy and wrangle it.
Adding Phillips should help raise Infor’s profile. But here’s the really amusing twist: There’s basically two paths Infor can take from here, IPO or get bought. And who would be the most likely buyer?
Oracle. Not because it needs any of the software in Infor’s portfolio, but because Oracle’s main criterion for purchases these days seems to be size, and Infor is one of the last multi-billion-dollar enterprise IT companies left in the industry’s rapidly disappearing “big but not Goliath big” tier.
But, of course, no matter what Phillips accomplishes in his career next-act, here’s what most of America will remember him for:
Photo: Jen Gallardo, CNN