Oracle quickly and quietly kills Virtual Iron
Oracle has decided to kill the Virtual Iron business and keep only the technology, according to a report in The Register.
Apparently, one month plus one week was enough for the database giant to float its latest acquisition into the dead pool.
While not surprising, this is an unfortunate situation for Virtual Iron customers and also feeds into BigCo sales tactics that tell customers to avoid buying from small companies. Oracle has long used the "bigger is better" sales tactic and this will falsely emphasize the perception that buying from start-ups and small companies is risky.
According to The Register:
In a letter to Virtual Iron's sales partners, Oracle says it "will suspend development of existing Virtual Iron products and will suspend delivery of orders to new customers." And in a second letter to a partner speaking with The Reg, the company says it will not allow partners to sell new licenses to anyone - including existing customers - after the end of this month (i.e. in 11 days). Before then, partners can only sell licenses to existing customers under certain conditions.
"Until June 30, 2009, Oracle may approve granting add-on licenses to existing Virtual Iron end customers, or licensing end customers who had demo'd or otherwise evaluated the former Virtual Iron products and do not require further delivery," the second letter reads.
Virtual Iron was certainly not a big dog like VMware or XenSource, but the company did hold a great deal of promise. In the acquisition announcement, Oracle described Virtual Iron as a "leading provider of server virtualization management software." Fellow CNET blogger Gordon Haff wrote that, in this instance, "leading" should be read as "on the roster but something like fourth-string backup quarterback."
As enterprise sales get harder to come by, there will be more of these types of deals. It remains to be seen if Oracle will do right by the customer and partner base, but I wouldn't bet on it.
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Dave Rosenberg dishes up "Software, Interrupted" with nearly 15 years of technology and marketing experience that spans from Bell Labs to multiple start-up IPOs to open-source enterprise software companies. He is co-founder of MuleSource and currently serves as the general manager of Hardy Way. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure. You can contact Dave via e-mail at softwareinterrupted@gmail.com or follow him on Twitter @daveofdoom. 
I'm seeing it in my employer's industry (green/renewable energy) right now: Lots of start-up players who got into it last year for a piece of the industry's pie are now finding themselves either being bought up or going belly-up.
Rough seas are harder on the smaller boats than they are on the larger ones. Not that it's right or just, but it simply is.
I mean isn't this not the same type of thing Microsoft did in the 90's? That you still ***** about today?
You confuse a rapacious monopolist's actions in the 1990s with the actions of a virtual (s'cuse the pun) non-competitor wanting to get hold of some useful tech that would otherwise become orphanware once its parent died off.
(Now if VMWare had bought the company and then disposed of it, you might have had a point. But they didn't, so you don't. )
It's not about Microsoft, therefore it's okay to have this happen. It's only when Microsoft is involved in some manner that they complain about it. Random_Walk's comments demonstrate this hypocrisy perfectly.
But in the end, I have to agree with Random_Walk on this one. There was simply too much out there that conflicted with each other, caused too much confusion, and generally muddied the waters of what was and what wasn't supported in the long haul.
One day, you might elevate above the help desk... but not if you continue your slavish devotion to any one vendor.
Here's a challenge for you: Please demonstrate for us Oracle's marketshare in the VM industry (hint: practically nil - their one product was a Xen clone right down to the code FFS). Then, show us Microsoft's marketshare of its industries (OS, browser, et al) compared to its competitors in the 1990s.
C'mon - let's see you either lie your butt off, try and weasel out of it, or embarrass yourself once the realization dawns on you. I don't mind either way.
I think what the author means to suggest is that it this idea is self-perpetuating and damaging, but that doesn't make it false. It is demonstrably true. The answer to such problems is regulation. Before that would have been a dirty, dirty word. Now it's merely a dirty one.
Virtual Iron was a willing sale. That is, VI sold itself willingly to Oracle. See also zvonr's take on it below.
Therefore, there's really nothing to regulate here.
- by GMooreSRG June 22, 2009 1:33 PM PDT
- The real sad part is when a good technology is killed off by market forces. Even sadder is the debt that was racked up in the process leading to this. This further proves the point that you should be careful what you invest in and be sure you have a backup plan should the company go under.
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(13 Comments)Dave neglected a key bit of information reported by the Register:
"According to The Times, the company had just $3.4 million in revenue last year, after spending $17.7 million on sales, marketing, research, development, and administrative costs."
Competition is important. So is liquidity. If you run your company and it's technology into the ground, you've done your entire customer base no good. I'm glad we never invested in Virtual Iron, only because this happened.
As far as I'm concerned, paid VMWare is overpriced (ESXi doesn't count) and Hyper V is half-baked.
What's left?