The FINANCIAL — EU commission said on Monday that they welcome Oracle Proposal to Win Approval for Sun Deal. The companies' latest promises to safeguard competition in the market for database software make the Commission optimistic that the case will have a satisfactory outcome, as commission said.
Oracle Corp. pledged to continue investing in Sun Microsystems Inc.’s competing database software after its planned $7.4 billion purchase of the computer maker was threatened by European Union antitrust regulators, according to Bloomberg. The European Commission said Oracle’s proposal addresses concerns about the acquisition of Sun’s MySQL database product, signaling the EU will approve the acquisition next month.
"Competition Commissioner Neelie Kroes … is optimistic that the case will have a satisfactory outcome, while ensuring that the transaction will not have an adverse impact on effective competition in the European database market," the European Commission said in a statement, Reuters reports.
The offer followed a two-day hearing in Brussels late last week at which Oracle customers, including Ericsson AB, the world’s largest maker of wireless network equipment, testified in favor of the deal. Redwood City, California-based Oracle held talks with commission officials on Dec. 11, according to a person close to the negotiations, Bloomberg informs. The negotiations between the commission and Oracle have been “a game of chicken all along, the way Oracle has played it,” Alec Burnside, a competition lawyer at Linklaters LLP in Brussels, said in a telephone interview today. “Oracle blinked.”
Oracle defended the deal during the hearing last week, but did not make any new commitments to address the Commission's concerns. The commitments to which the Commission referred Monday were given outside the hearing, according to PC World. More specifically, the Commission said that "Oracle's binding contractual undertakings to storage engine vendors regarding copyright nonassertion and the extension over a period of up to 5 years of the terms and conditions of existing commercial licenses are significant new facts."
According to Zdnet.com followings are the Oracle’s key points:
The company will keep MySQLs storage engine APIs public. The documentation won’t change from what Sun Microsystems currently has. Oracle will also maintain the reference manual that Sun has created.
Oracle “shall not assert or threaten to assert against anyone that a third party vendor’s implementations of storage engines must be released under the GPL because they have implemented the application programming interfaces available as part of MySQL’s Pluggable Storage Engine Architecture.” That move is a change from Sun’s current practice.
MySQL customers will be able to extend Sun’s commercial license until Dec. 10, 2014. These customers also won’t be required to buy support from Oracle. Support subscriptions can renew annually or over multiple years.
Oracle said it will continue to enhance MySQL under the General Public License. It will also increase research and development spending.
The company will create MySQL customer advisory board. There will also be a vendor advisory board.
Oracle Chief Executive Officer Larry Ellison said in September that he wouldn’t sell MySQL, which is a key part of the Sun acquisition. The commission’s delay in approving the deal is costing Santa Clara, California-based Sun $100 million a month, he said, according to Bloomberg. MySQL’s market share is estimated by IDC, a research firm in Framingham, Massachusetts, at 0.2 percent with $40 million in revenue in 2008.
The commission has said MySQL, with about 60,000 daily downloads, is the most deployed open-source database and its “competitive significance is much greater than its very small market share based on revenue would suggest.” MySQL’s program is based on freely distributed code, the same source reports.
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