Oracle-HP ruling highlights risks of IT vendor partnerships

03.08.2012

The lengthy, dramatic and often personal conflict between HP and Oracle is not quite like any other relationship in the IT industry. The companies were close partners for years until Oracle acquired Sun Microsystems at the beginning of 2010, which sent the database software giant into hardware competition with HP. After Hurd left HP in August of that year and joined Oracle as co-president in September, things went farther downhill.

The Hurd Agreement was drafted to patch things up, but by March 2011, Oracle said it would stop porting software to Itanium. HP sued shortly afterward, and Oracle countersued with a claim that HP was secretly phasing out Itanium.

"While the situation between HP and Oracle seems extraordinary, I expect the ruling will lead many companies to be more careful in crafting partner agreements," Pund-IT analyst Charles King said in an email interview.

"The judge's decision to find so broadly in favor of HP based on the agreement related to Hurd's hiring by Oracle was surprising," King said. "It certainly seems to emphasize the value of rhetorical specificity."

Ray Wang, principal analyst and CEO at Constellation Research, also said the ruling held a warning for other companies.