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Oracle's Ellison Issues Cloud Challenge

Stocks in this article: ORCL JAVA

REDWOOD SHORES, Calif. ( TheStreet -- Oracle (ORCL - Get Report) CEO Larry Ellison plans to wield cloud computing as a cudgel against its rivals once the database giant completes its Sun Microsystems (JAVA) acquisition.

With the E.U. looking increasingly likely to approve the $7.4 billion purchase, Oracle struck a bullish tone during the conference call to discuss its second-quarter results late on Thursday.

Oracle expects "full and unconditional clearance" from the European Commission in January, despite regulators' initial skepticism about the deal's antitrust implications.

With the Sun deal now seemingly inevitable, Ellison outlined his plans for his latest acquisition. The combined Oracle/Sun will offer high end, high performance machines capable of supporting firms' cloud computing efforts, he said.

Cloud services, which offer compute power and storage via the Internet or a secure network, are fast becoming one of the tech sector's hottest technologies. A growing number of companies are pushing cloud services as a way for firms to avoid the upfront costs of hardware and software.

Ellison explained that the combined Oracle/Sun contains all the requisite components for cloud computing, from servers, storage and networking through to database software and operating systems.

By offering these myriad technologies in a tightly integrated package, the fiery Oracle chief is confident of gaining market share against rivals Dell (DELL - Get Report), IBM (IBM - Get Report), and Hewlett-Packard (HPQ - Get Report).

"We think that will heavily differentiate our offering with the offerings of IBM, HP and Dell," added the CEO. "We think we can compete very effectively there and that will deliver high margins and allow us to deliver that $1.5 billion of additional profit in our first full year of having Sun."

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