Sun Microsystems losing £100m a month, says Oracle's Ellison

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The Independent Online

Larry Ellison, chief executive of the software giant Oracle, has fulminated against European regulators, saying Sun Microsystems was losing $100m (£61m) a month while its takeover by Oracle remains unapproved.

The European Commission is conducting an in-depth competition inquiry into the proposed $7.4bn takeover, saying that it could create a monopoly in the market for database software. Oracle's software dominates this segment of the market, while Sun offers an open source version called MySQL. But Mr Ellison said he was sure that the deal would be waved through in Europe as it has been in the US, and the delays are simply causing unnecessary damage.

"Once they do their job, they are going to come to the same conclusion: MySQL and Oracle do not compete at all," he said. "The longer this takes, the more money Sun is going to lose. That's a big problem."

Mr Ellison is the world's fourth richest man, with a fortune estimated by Forbes magazine at $22.5bn. He founded Oracle in 1977, turning it into one of the most influential software companies in the world, with the firepower to spend $35bn on acquisitions over the past five years.

Named after the Stanford University Network built by four students there for an IT project, Sun found its servers highly popular during the boom a decade ago, but its hardware and software businesses have struggled since. Oracle swooped in April after Sun's takeover talks with IBM stalled.

Sun's revenue has been tumbling since its acquisition was announced. IBM and Hewlett-Packard have poached customers amid uncertainty about its future.

The European competition commissioner, Neelie Kroes, said earlier this month that she wanted a full 90-day investigation of whether Oracle would favour its own database software over the open-source MySQL when working on IT projects for customers.

"Databases are a key element of company IT systems," Ms Kroes said at the time. "In the current economic context, all companies are looking for cost-effective IT solutions, and systems based on open source software are increasingly emerging as viable alternatives to proprietary solutions. The Commission has to ensure that such alternatives would continue to be available."

Mr Ellison remained uncompromising during his appearance at the Churchill Club, Silicon Valley's most prominent speaker forum. "We're not going to spin [MySQL] off."

He said broader economic conditions remain challenging and he did not foresee a rapid recovery.