Oracle watches as Sun sets in East

October 21, 2009

By dithering over the $7 billion sale of Sun Microsystems to Oracle, and delaying all those magical synergies, rationalizations and economizations, EU authorities are forcing Oracle to synergize, rationalize and economize just to maintain some semblance of value.

Sun is blaming fresh plans to slash about 10 percent of its global work force on European antitrust regulators, who have not yet cleared the transaction. Don’t be too surprised if the bulk of the firings are targeted in Europe.

Oracle CEO Larry Ellison recently said Sun is losing $100 million a month because of uncertainty about the computer maker’s future. Rivals IBM and Hewlett-Packard are taking advantage by poaching Sun’s customers with steep discounts.

“Sun’s business is really hurting,” said Cross Research analyst Shannon Cross. Analysts had widely expected thousands of Sun employees to lose their jobs, but not until Oracle closes the deal.

At this rate, Oracle may end up with a black hole.

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