DailyTech - Sun Microsystems Acquisition Faces Objections from European Commission

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IT Sun Microsystems Acquisition Faces Objections from European Commission
Michael Barkoviak - November 11, 2009 12:00 AM

14 comment(s) - last by michael67.. on Nov 11 at 4:10 PM

Sun, Oracle may not be able to finalize the agreed acquisition in 2009

The proposed acquisition of Sun Microsystems by industry powerhouse Oracle may have hit a roadblock by the European Commission, which has objected to the multi-billion deal.

Sun received the "statement of objections" list from the EC at the start of the week, but both Oracle and Sun are expected to move forward to try and complete the deal as soon as possible.

The deal was approved by the U.S. government in August, though some analysts expected possible resistance from the EC. EC officials are concerned businesses in the EU may have to pay higher prices and have fewer choices of database software if the acquisition is finalized.

"After conducting a careful investigation of the proposed transaction between Oracle and Sun, the Department's Antitrust Division concluded that the merger is unlikely to be anticompetitive," U.S. Deputy Assistant Attorney General Molly Boast noted in a public statement.

U.S. officials are expected to help Oracle and Sun complete the deal. Sun reportedly lost $120 million in its most recent financial quarter, and will continue to lose money until the Oracle acquisition is finalized.

Both companies, along with any U.S. government officials, will be able to plead their case in front of the EC. If the acquisition isn't agreed upon, it's possible the EC may force Sun to spin off MySQL prior to the acquisition, though exact compromises remain unknown.

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Future of mysql and java

By uibo on 11/11/2009 5:57:53 AM , Rating: 2

"Antitrust Division concluded that the merger is unlikely to be anticompetitive" - Why doesn't this make me feel more secure about their future? Am I paranoid if I don't have much faith in their assessment?

I really hope java, Netbeans and other technologies will not suffer from the merger. Because I don't see how the development could bring them money.

RE: Future of mysql and java

By omnicronx on 11/11/2009 8:12:22 AM , Rating: 1

I really doubt they will suffer, Oracle has invested a lot of money in Java. They fully support free IDE's like Eclipse (they are actually on the board if I am not mistaken) and while they do rape you with support, many of their products are free.

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RE: Future of mysql and java

By randomb0y on 11/11/2009 8:48:43 AM , Rating: 2

Nope. List price for oracle's standard license, enterprise edition, is about $45.000 per CPU, which is far from being free.

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RE: Future of mysql and java

By MrBlastman on 11/11/2009 11:40:04 AM , Rating: 2

I think we're all missing something here. It is the EC making this objection, i.e. a European body.

Oracle is based in Redwood City, California, USA.
Sun is based in Santa Clara, California, USA.

What is common with these two companies other than then being Californian... they are American companies!

So, really, if Europe thinks that they have a right to deny these American companies from merging, I suppose this gives Australia, Japan, Korea, Iran, Iraq, Saudi Arabia, Turkey, Britain, Russia, New Zealand, Uzbekistan, Nepal, Vietnam, Brazil etc., the right to do so as well? What is this world coming to?

These are American companies. They should extend their middle fingers and go ahead and merge. If the Europeans have issue with this, they can a. Stop using Java and b. Stop using Oracle's products. There is a whole world out there. It does not all revolve around Europe.

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RE: Future of mysql and java

By Taft12 on 11/11/2009 12:23:26 PM , Rating: 1

I hate to rain on a good rant, but what you are saying is absolutely not true. Both companies are very clear on identifying themselves as multinationals and neither company would consider not operating in the European market.

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RE: Future of mysql and java

By MrBlastman on 11/11/2009 1:16:33 PM , Rating: 2

How is it not true? What part of what I said is not true? I had plenty of facts in my post.

How often do you see America crying antitrust to foreign companies with their home base in foreign countries that are trying to merge with another foreign country?

The answer, as far as I can tell, is not often to never. We're too busy worrying about our own companies and how we can win over others in the free market. The EC needs to learn this and try sticking to it.

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RE: Future of mysql and java

By Taft12 on 11/11/2009 1:55:01 PM , Rating: 1

The only fact I saw was
It is the EC making this objection, i.e. a European body.

The rest is opinion and false claims (the cities are technically correct, but I think you're looking for "headquartered", those companies each are "based" in dozens of countries).

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RE: Future of mysql and java

By MrBlastman on 11/11/2009 2:30:35 PM , Rating: 2

While they have offices in foreign countries, they are traded on the NASDAQ stock exchange, an American exchange. They are, for all intents and purposes, American companies. I can not fathom at all how you might convolute this and say they are not just that.

Just because the American armed forces operate in Iraq, Afghanistan, Europe and the rest of the world does not make them a "multinational" military. The same holds true with these companies. They are headquartered here, they pay American income taxes.

There are boundaries between countries and we do not have a global government. If you disagree, I then hereby decree that BMW, Mercedes, Toyota, Sony, Ikea, etc. all are infringing on my multinational citizenship rights and most importantly, my American perceptive rights and they should all be shut down immediately! ;)

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RE: Future of mysql and java

By bernardl on 11/11/2009 3:17:07 PM , Rating: 3

quote:
So, really, if Europe thinks that they have a right to deny these American companies from merging, I suppose this gives Australia, Japan, Korea, Iran, Iraq, Saudi Arabia, Turkey, Britain, Russia, New Zealand, Uzbekistan, Nepal, Vietnam, Brazil etc., the right to do so as well? What is this world coming to?

Welcome to the world.

The EU commision has perfectly the right to tell companies trying to do business in Europe what they should be doing. They have been doing it with MS for years.

In case you are not aware of this, a company doing business in a geo had to comply with the regulations of this geo.

Oracle and Sun have the right to stop doing business in EU, but that would probably reduce their market size at least 30% if not more, so it won't be happening.

Instead of looking at this from a US vs non US angle, why not wonder why the US gov did give a GO to this although there will clearly be an impact in terms of DB options since MySQL will probably going down the drain indeed?

If you believe that US regulations are not trying to impact non US companies think again, US regulations like export control have far reaching implications outside the US (and do harm the US a lot by the way).

Cheers,
Bernard

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RE: Future of mysql and java

By michael67 on 11/11/2009 4:10:15 PM , Rating: 2

Why is it that every time EU dose something, people start shouting here "leave the f... EU, we don't need them"

Even do they are both original US company's, they are now two big international company's.
And there actions influence also for a big part the EU economy, being based in the US the negative impact is smaller in the US then in the EU, so the opinion how to react can be different between the EU and the US.

Also EU anti trust legislation is different and mouths more strict then the US.
But even if these ware EU company's i think the EU would reacted the same way.

Also i can remember when "ING Group" words biggest bank based in the Netherlands bought a other bank EU based bank, the US told them to sell some US bank('s) the had, even do they had the go ahead from the EU
http://en.wikipedia.org/wiki/ING_Group

So what the difference between Oracle and ING other then they are selling different products.
And i never seen any reactions like this when the US told them that they had to sell.

I am not saying our way is better, its just different and if you wane sell your product here you have to live by the rules we use, as it go's the other way around to, as we have to follow US rules if a EU company is doing business in the US.

And imho a little bit of regulation doesn't hurt and can be actual good in the long run.
Like the banking could have used it the last 10~20 years (also a bit in the EU)

And also when NY started actions against Intel, they ware mostly positive, but when the same actions ware taken by the EU we got flamed for being greedy basters. (a bit of a double standard)

And if wanted i could start a rant about the US, starting over 50 years a go beginning whit "Operation ajax" and ending whit the invasion of Iraq and banking in the US
But lets just say we have different point on view on how to business and do things in the world.

But we live in the same world and we are when it comes to the basic things, we are not that different, only in the way how we get there.
http://www.taurillon.org/Europe-vs-USA-Whose-Econo...

But a little respect our way would be welcome, and usually will get you respect back to, but lack of it will defiantly also earn you the the same back.

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RE: Future of mysql and java

By Taft12 on 11/11/2009 12:24:05 PM , Rating: 2

Bad vibes coming from Oracle on the Netbeans front:
http://www.infoq.com/news/2009/11/oracle-sun-palns

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duh

By xii on 11/11/2009 3:07:19 AM , Rating: 1

Am I missing something here? Isn't it obvious that mySQL will not continue to develop as many good features (available for free) if Oracle owns them?

RE: duh

By Master Kenobi

(blog) on 11/11/2009 5:57:35 AM , Rating: 2

Most likely not, but it is hard to say. Oracle's own database software is free, but they rape you on support and consulting costs. MySQL could go much the same way.

Regardless however, it will not cause problems in the database market. You still have Microsoft pushing SQLServer and SQLServer Express, this covers small, medium and even large database systems. For the super high end you always have IBM's DB2 systems. Not to mention Sybase and all of the other little nich database systems on the market.

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RE: duh

By maugrimtr on 11/11/2009 9:36:55 AM , Rating: 2

MySQL is open source, i.e. Oracle cannot prevent future development on it. Indeed there are already two MySQL forks (for example, Drizzle). So Oracle can't shut down MySQL. What they can do is not offer official support - though all of this boils down to something interesting. Technically Oracle and MySQL serve two different traditional markets so they are not so much competing against each other as serving different sets of requirements for different people.

If Oracle doesn't want MySQL (which they don't compete with anyway - ever run a web app on Oracle outside of an enterprise?), they can simply spin it off as its own entity or even take the non-profit route like Mozilla did. There's definitely money to be made on the back of MySQL - but Oracle might not really want the trouble of doing so.

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