Oracle: Hewlett-Packard is "Strategically Screwed" without Itanium

Paul Lilly

Some interesting revelations are coming out of the court battle between Hewlett-Packard and Oracle. At issue is Oracle's decision to stop supporting Intel's Itanium platform based on claims the processors are nearing end-of-life (EOL) status, the timing of which is suspect. Oracle made the decision to ditch Itanium after hiring former HP CEO Mark Hurd, which itself prompted a legal battle and subsequent settlement. Not long after, Oracle said it was ditching Itanium, HP cried foul, and a big legal mess ensued. Some of it was resolved last night.

A California judge rejected a fraud claim by Oracle that would have freed it from an agreement to support Itanium. As part of the settlement over Oracle's hiring of Hurd, Oracle agreed to continue supporting Itanium. However, Oracle alleged that HP fraudulently hid the fact that was in the process of hiring Leo Apotheker (former SAP CEO) as CEO and board chairman Ray Lane (former Oracle executive), two well known Oracle opponents.

While Oracle lost this particular battle, it hasn't lost the war. Newly unsealed documents as part of Oracle's cross-complaint reveal that HP may have paid Intel $440 million to keep Itanium alive through 2014, which didn't include the cost of the chips.

"The stunning $440 million deal was a pure pay-off to induce Intel to keep churning our processors that it really wanted to kill," Oracle said in court filings, which are posted at All Things D. "According to its plan, HP did not reveal this material agreement to the marketplace, or even to its own salesforce."

Oracle maintains that by going all-in with Itanium even as Intel wanted to kill off the processor line, HP essentially "backed itself into a corner" when it should have been pushing Xeon solutions, and without Itanium, HP is "strategically screwed."

It's all very messy, and highly interesting. If you have a few extra minutes, give the unsealed filing a read here .

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