Main image of article Oracle’s Dell Alliance a Confusing Shift in Strategy
[caption id="attachment_10180" align="aligncenter" width="500"] A deal with Dell seems to run contrary to Oracle's own hardware aspirations.[/caption] Oracle and Dell have announced an alliance that will see Oracle software preloaded onto Dell hardware. Under the terms of the agreement, Oracle IT infrastructure technologies such as Oracle VM and Oracle Enterprise Manager will be optimized to run on Dell’s x86-based technologies. Dell will provide customer support for the joint offering. Oracle also announced that Dell is now a preferred x86 partner, while Dell returned the favor by naming Oracle a preferred enterprise infrastructure partner (which apparently includes Oracle Linux). “This partnership with Dell is an extension of Oracle’s engineered systems strategy where we simplify IT and reduce integration costs by delivering hardware and software together,” Oracle president Mark Hurd wrote in a statement. “We believe that by working together, Dell will gain significant market share by delivering to its customers an integrated, optimized solution designed to deploy business critical applications.” That’s all well and good, but it neatly sidesteps the conundrum at the heart of the relationship: Oracle builds its own hardware, which competes directly on the open market against similar offerings from Dell, Hewlett-Packard, and other IT giants. If Oracle signs an agreement that preloads its software onto Dell hardware, it gives potential customers (especially those that run shops with a preponderance of Dell products) less reason to buy Oracle hardware. And Oracle hardware needs all the help it can get: revenues for that division dipped 23 percent year-over-year, to $671 million. Maybe Oracle executives see the company’s software as the future, in which case a deal to preload it onto a rival’s hardware makes total sense; but such a strategy also throws Oracle’s hardware under the proverbial bus, to a certain extent. The strategy also runs counter to Oracle’s longtime habit of pushing its hardware and software as an integrated stack. However, Oracle has already made some bold moves beyond its hardware-and-software comfort zone. While initially reluctant to embrace the cloud, the company has embarked on a series of acquisitions and product launches designed to make it much more of a player in the Infrastructure-as-a-Service (IaaS) and Software-as-a-Service (SaaS) space, although it’s unclear whether that gambit is succeeding. If Oracle really is reorienting to focus the bulk of its energies on software, then the Dell partnership is a logical step in that plan; but it also sparks the question of whether Oracle will devote less effort to its hardware division going forward.   Image: Eric Broder Van Dyke/