Oracle and Unbreakable Linux III
November 2, 2006 Leave a comment
This is turning out to be a hotter topic than I had anticipated, so I figured I post some additional thoughts I have. First, I'll expand on some comments I made in previous posts. Looking at the numbers it seems that Oracle accounts for about 15% of the RHEL business. Substantial, but not devastating. I also have two additions to my previous pricing comments. It should be noted that no enterprise customers pay (anywhere near) the published retail price for RHEL. That price is if you purchase a single license and have no existing relationship with Red Hat. Having dealt with Red Hat on behalf of many companies, depending on quantity the discounts can be significant. Moving back to Oracle, I'm still not convinced their customers are that price sensitive to the Linux bit of the equation. Looking at a loaded Oracle + RHEL solution for a quad processor box and you come up with roughly $200,000. Even at list price the Linux bit of that is close to $2,000 (RHEL AS is either $1,500 or $2,500, depending on support level). You have to wonder if Oracle customers will start looking closer at Oracle prices in general. In the end, this could result in those customers asking the hard questions and driving the price of other Oracle products down.
On another cost-related note, most external applications that an enterprise is going to be using are going to be certified against RHEL or SLES. Until (and indeed if) that certification is also applied directly to the Oracle product, it's always possible that odd and hard to track down bugs will be encountered. The same goes with any internally developed applications. The entire Q/A process will have to begin from scratch on the Oracle product. Additionally, if you already have an install base of RHEL and then add some Oracle, all new Q/A will need to be done twice to ensure things will work reliably and as expected. That Q/A cost alone, along with the uncertainty of how well Oracle will even be able to support Linux may keep many customers with Red Hat, at least for the short to mid term. It should be interesting to see if vendors like BEA and IBM certify against the Oracle product. Ubuntu is also trying to move into this space. In my opinion, 3 is the absolute maximum number of Linux vendors that many enterprise application vendors will be willing to certify. Who those 3 will be remains to be seen.
In the end, as I mentioned previously, I think this move really validates the Open Source model. The backing of Oracle at this level should rapidly further the uptake of Linux in the space, even if it's not via an Oracle solution. People don't want to be beholden to a single vendor any longer, and transitioning from RHEL to Oracle or Oracle to RHEL (or even using a mix of the two) will be much easier and less expensive then completely switching platforms (say, from Windows to Linux).
Red Hat, Oracle, RHAT, ORCL, Linux, Open Source, RHEL, Unbreakable