Oracle's Ellison feeds talk of Linux plans--again

Oracle CEO Larry Ellison said that Oracle could, in theory, redistribute Red Hat Linux, prompting Goldman Sachs analyst Rick Sherlund to speculate that the company will do exactly that some time this year.

In an interview with Forbes published last Thursday, Ellison reiterated statements made to the Financial Times in April, when he said that Oracle should distribute and support a full "stack" of software, including Red Hat Linux, the dominant Linux distribution to businesses.

Those comments did more than just fuel a great deal of online chatter and speculation; they also sank the stock of Novell, Red Hat's largest Linux competitor.

In the Forbes interview Ellison said that he wasn't sure Novell understood what he said about Linux and Oracle.

"What I said was that the interesting thing about open source is that the intellectual property is available to all of us. So what that means is that any company can take the Red Hat Linux and use it at no cost, so long as they're willing to support themselves. Well, that actually includes us," according to the transcript.

Goldman Sach's Sherlund took that as a clear indication of Oracle's actual plans, saying that he expects Oracle to announce its open-source strategy in October at an analysts meeting, which will include a distribution of a Red Hat-compatible Linux for less money than Red Hat.

"We believe Oracle is motivated to preempt Red Hat's progression up the infrastructure stack as a database and middleware vendor by disrupting Red Hat's business model but not harming the Red Hat Linux distribution which Oracle needs to be successful to counter Microsoft," Sherlund wrote in a note published on Monday.

He added that he believes that Oracle has the legal rights to distribute and support Red Hat Linux, as the CentOS project is already trying to do.

In the Forbes interview, Oracle offered up a few other comments which could rattle competitors.

He noted that Oracle could buy BEA Systems--long a rumored acquisition--or buy BusinessObjects, the largest business intelligence vendor, according to IDC.

Ellison also dismissed the notion of ad-supported software and Microsoft's pursuit of Google.

"I think that is ridiculous. It is hard to believe that Microsoft has Google envy. We're in the software business--we don't do ads. We're not going to sell ads on top of our database," he said.