According to Ashlee Vance, Oracle's own distribution of Linux isn't too far off:
Wall Street continues to drool over the idea of Oracle producing its own line of Linux software for reasons unclear to us....Last week, Jeffries & Co analyst Katherine Egbert fired off a research note, claiming that "our independent checks in the past two weeks indicate that Oracle seems to be close to introducing its own software 'stack'." Rumours have floated for ages that Oracle will craft a Larry Ellison version of Linux to complement its database and other assorted middleware. Such a move would back up CEO Ellison's near constant Red Hat bashing....Ultimately, however, Oracle Linux would be more of a muscle flexing exercise than anything else. The only way to make money off Linux is via services, and Oracle can provide plenty of those whether or not it sells an operating system.