Oracle’s Itanium loss costs could hit billions
Oracle could face billion dollar payments to HP after a judge ruled it breached a contract by stopping support for Itanium servers.
A California state court judge ruled in favour of HP in a bitter lawsuit over Oracle’s decision to end support, which HP says makes its products less attractive to customers.
The judge ruled that Oracle was required to continue to offer its product suite on HP’s server platform, further complicating a business partnership that’s soured since Oracle starting competing with HP by selling hardware.
The Itanium range is HP’s enterprise class workhorse and being unable to run Oracle’s software on the platform would have been a major below to the company, with major corporations and governments relying on Oracle software.
HP’s argument turns the concept of Silicon Valley ‘partnerships’ upside down
According to the Financial Times, HP could now seek damages of up to $4bn dollars over the case, although Oracle is likely to launch an appeal to get the decision overturned.
Quoting tech industry analyst Rob Enderle, the FT said the damages would be “in the billions of dollars”, while Oracle would also face additional costs porting future versions of software to Itanium.
The ruling turned on one short sentence in an agreement, something that may give Oracle ammunition in its appeal.
“We know that Oracle did not give up its fundamental right to make platform engineering decisions in the 27 words HP cites from the settlement of an unrelated employment agreement,” Oracle spokesperson Deborah Hellinger said in a statement.
“HP’s argument turns the concept of Silicon Valley ‘partnerships’ upside down. We plan to appeal the Court’s ruling while fully litigating our cross claims that HP misled both its partners and customers.”