Oracle Buying Into Service Delivery
The database giant has not formally announced the acquisition, nor filed any details with the Securities and Exchange Commission (SEC) yet, but Oracle spokesman Martin Ljungström says the Hotsip acquisition is part of Oracle's move to "broaden our SDP strategy, which we will be outlining in mid-March." He declined to provide any further details of the acquisition, as did Hotsip representatives here at the 3GSM show in Barcelona.
A second SDP-related acquisition is imminent, according to sources with the company here at the show, though Oracle declined to comment officially on any such move. Sources believe the target is middleware firm JBoss Inc. , which has been linked to Oracle during the past few days.
SDP platforms, which allow carriers to more efficiently deploy and integrate diverse services and back-office systems, are becoming increasingly important to telecom operators and their suppliers, with giant technology names such as Ericsson AB (Nasdaq: ERIC), IBM Corp. (NYSE: IBM), HP Inc. (NYSE: HPQ), and Microsoft Corp. (Nasdaq: MSFT) already established players. (See IMS & SDPs Must Work Together, HP, Telcordia Hop SDP Bandwagon, Global Crossing Puts SDP Into Action, FT Commits to MS SDP, and Carriers Buy Into SDPs.)
Microsoft this week announced that Orange (NYSE: FTE) and China Mobile Communications Corp. are interested in the technology. (See 3GSM: Day 1 News Roundup.)
The move will light a fire under the SDP market, believes Heavy Reading analyst Caroline Chapell, who follows the market closely. She says Oracle is already a supplier to many telecom operators as the database part of its business support systems (BSS), and this is "Oracle making a play to go up the stack in an effort to get more of the telco spend on next-generation OSS and BSS systems. Look at what IBM is doing with Cramer Systems Ltd. as its way to get into the OSS space." (See IBM, Cramer Team on SDPs.)
Chapell adds: "What's really interesting is that Oracle is coming into the SDP market by buying and owning technology, and not just partnering, which is what IBM and HP have done. This really sets Oracle head-to-head with those companies."
Chapell says BEA Systems Inc. (Nasdaq: BEAS), a company that Oracle is believed to have looked at in terms of an acquisition, has similar strengths. Both Oracle and BEA declined to comment on whether acquisition talks had taken place, though it is believed BEA would have cost too much and the takeover would have necessarily been hostile. BEA's current market capitalization is $4.6 billion. (See BEA Lands O2 Deal, BEA to Show Off IMS, BEA Expands Ecosystem , and T-Systems Relies on BEA.)
The analyst also believes that Oracle's acquisition of a SIP technology company as a way into the SDP sector "is a big endorsement for SIP" as the protocol of choice in telecom applications development. (See Telenor Launches VOIP Services on Hotsip and WiMax Uses Hotsip.)
BEA reacted calmly to Oracle's imminent market entry. A spokesman said Oracle is a natural player in the SDP ecosystem, and that the move would make no difference to BEA. "It will simply highlight how important the SDP market has become," he asserts.
— Ray Le Maistre, International News Editor, Light Reading