| The real point of Unbreakable Linux: breaking Red Hat |
Feb. 06, 2007
Following my recent article in which I wrote that neither I, nor several financial analysis firms, were aware of any companies that were planning to deploy Oracle's Unbreakable Linux, a handful of companies have told me that they are giving Unbreakable Linux a try.
What I think is interesting is why they're giving it a try, and what it tells us about Oracle's intentions towards Red Hat.
First, none of these companies was willing to go on the record with their names. Why? They didn't want their names used because none of them wanted to get into trouble with Oracle. And, since all but one were Oracle customers, it's easy to see why they wouldn't want to get on Larry Ellison's bad side.
The reason that most of them are trying Unbreakable Linux is that Oracle was offering an additional 50 percent discount -- on top of the original 50 percent discount to RHEL (Red Hat Enterprise Linux) customers -- to users who subscribed to the new operating system by January 28.
At this price, as several of the customers said, there's no way that Oracle will break even on Unbreakable Linux sales. Oracle was also keeping this double-discount hush-hush. Not all customers or analysts knew that Oracle was being this aggressive with pricing.
That said, I'm still unable to find even a single customer who has replaced RHEL with Oracle Unbreakable. I did find several Oracle customers, however, using Unbreakable in new deployments.
At the same time, though, almost everyone I spoke with intends on using Oracle's cut-throat pricing in price negotiations when it comes time to renew their Red Hat RHEL contracts.
The one exception was a mid-sized company that was not an Oracle customer. While this business was unhappy with Red Hat's pricing, they didn't find Oracle's loss-leader pricing interesting. As one negotiator for the company said, "None of the Oracle reps could say anything except 'We're cheaper.' In our discussions, Oracle was evasive on the service agreement, deployment details, levels of support, etc., etc." They turned Oracle down.
To them, it appeared that Unbreakable Linux was nothing but an attempt by Oracle to undercut Red Hat pricing without anything of substance in and of itself. Since this company wanted a dependable enterprise operating system, and not a cheap operating system with open questions about service and support, they're electing to stick with Red Hat and hire more in-house Linux IT staff.
As I look at the situation, it becomes ever clearer to me that Unbreakable Linux is really not a serious business operating system offering. It's simply Oracle's attempt to break Red Hat.
While this will certainly put short-term pressure on Red Hat, I doubt it will do much more than that. Low prices are all well and good, but if Oracle doesn't back it up with service and support, no price will be low enough.
-- Steven J. Vaughan-Nichols
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