The settling of old scores

Summary:While covering JavaOne I was talking to Sun chief technology evangelist Simon Phipps about all the recent rapprochement among the industry titans. He aptly described the trends as a settling of old scores.

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While covering JavaOne I was talking to Sun chief technology evangelist Simon Phipps about all the recent rapprochement among the industry titans. He aptly described the trends as a settling of old scores. It's like the various mafia families in The Godfather deciding to settle old scores, but instead of bloodshed and further emnity, one company relunctantly pays the other lots of money to settle up. Today, Microsoft and IBM settled an old score that was part of the DOJ's antitrust litigation against Microsoft a decade ago.

The cost to Microsoft--a mere $775 million cash and a $75 million credit toward Microsoft software deployments. Also this week, Sun and IBM came to terms with Big Blue extending its Java license and supporting Solaris 10 on AMD and Sparc. I am still wondering what Sun gave back to IBM in the settling that score. Perhaps very favorable terms on its Java license and promise of more open sourcing of Java. In any case, Sun has now mended fences (and received billion of dollars in compensation) with Microsoft and IBM.

It would be nice to think of the rapprochement as doing what's best for customers  and shareholders, clearing the decks of nagging legal matters and cooperating on standards, interoperability and platform support. There is some of that at work among the triad of IBM, Microsoft and Sun. Certainly, Microsoft needs to extract itself from the burdensome, polarizing antitrust litigation, and sell the 21st century, kinder and friendlier version of itself. Last week, Microsoft showed off its support for RSS, complete with a Creative Commons license for nifty extensions. Sun needs to get over its whining about IBM and Microsoft, and get on with selling on the merits of its offerings and it how it plays well with other platforms.

My co-anchor David Berlind says an oddly charged equilibirum exists between IBM, Sun and Microsoft that keeps all three of them in check against each other. The new spirit of coopetition is partly driven by the collective sense that the world is becoming more transparent, especially via the Web and concerns about corporate ethics, and doing business the old way, such as strong arming the channel or locking-in customers, won't play. That said, the political undercurrents of the complex relationships are never far from the surface--Microsoft and Sun ganging up on Linux, IBM and Sun ganging up on Microsoft. Oracle's acquisition binge to take on SAP is also part of the same undercurrent for control of a major piece of the IT empire.

One source of the settling of old scores is that there is no dominant Godfather. It used to be that Bill Gates lorded over the PC industry, vanquishing IBM and Apple on the desktop and taking on the enterprise. IBM lorded over the enterprise world, with HP, Oracle, SAP, Sun and others carving out their territories. While those companies still dominate the landscape, their foothold is no longer as strong.  

No single company or CEO is going dictate the future direction of the  industry. Just look at how community development and the open source movement have impacted the IT industry. It hasn't so much shifted the balance of power, but it catalyzes a shift away from proprietary to open platforms. At least two of the triad have adopted the open source mantra, and even Microsoft is beginning to show some open source skin. Open source has been known to save enterprises lots of money, so why resist? 

The major vendors recognize that their customers don't want to get caught in cross fire as they bloody each other fighting over market share with loutish behavior. At the same time, one or more of the companies will make a bold move to raise the stakes, sending them all to the mattresses again... 

Topics: Oracle

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