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Oracle Outlines Plans for Sun

Oracle, after completing its Sun acquisition, has vowed to a become a new breed of technology company.

Updated with Oracle CEO Larry Ellison's comments on Sun layoffs.



) -- Today,


(ORCL) - Get Report

vowed to build a new breed of technology company, after it completed the






Although traditionally a database software company, Oracle will now combine its core technology with Sun's server and storage offerings, as well as tightening its links with Sun's MySQL, Java and Solaris software. On the server side, Oracle promised "differentiated" products, focusing on more expensive, specialized machines.

"We're not too interested in the commoditized x86 market -- there are other people that do that,


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or whoever," said Oracle co-president Charles Phillips.

Oracle, which competes with


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, will offer customers a "pre-integrated" and "pre-engineered" mix of different technologies, according to Phillips.

"There's simply no other company that can claim they are in the complete systems business," Phillips said during a webcast outlining the company's strategic plans for Sun. "The other companies simply don't have all the components, they are simply not in the market."

Oracle CEO Larry Ellison also took the stage late in the five-hour webcast, and promptly launched a diatribe against sections of the press and some analysts.

The Oracle chief explained that he was "very upset" to see recent articles in the press saying that his company planned to lay off half of Sun's 29,000-strong workforce.

"That's a highly irresponsible thing to print," he added. "The Sun people have gone through enough angst without reading this garbage."

Ellison went on to explain that Oracle is actually hiring 2,000 people. "That's twice as many people as we will be laying off - we're hiring, not firing."

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Sun, he added, will be profitable from the first full month Oracle owns the company. "The Sun business is going to grow," explained Ellison. "We just have to do a better job of taking this wonderful engineering output and delivering it to customers."

Oracle president Phillips also vowed to maintain Sun's strong open source credentials during his presentation, something which had initially prompted concern from European regulators. The executive was at pains to depict his own company as a friend of the open source community.

"Nothing changes in our commitment to open standards," he said. "We want to become what IBM was in the 1960s, but on open standards -- all our next-gen applications are written on Java.

Oracle also said that it will keep the independent MySQL sales force and engineering brains it inherited from Sun, as well as attempt to build better integration with the database specialist's offerings such as Enterprise Manager, Secure Backup and Audit Vault.

Sun storage supremo John Fowler also joined Phillips on stage in Northern California. Fowler explained that Oracle is increasing its investment in Sun's 7000 ZFS storage device, which it is touting as a way for customers to run multiple storage applications.

"We're going to have seamless integration across the ZFS storage appliance," he added. "We have worked to integrate the 7000 ZFS with Oracle Virtual Machines (OVM)."

During his presentation, Phillips also said that Oracle would "rationalize" Sun's supply chain, making it much more efficient in an attempt to reduce costs.

Phillips added that Oracle will implement a "more comprehensive support plan" with single point of contact and said that there will be a more direct link to large customers. "We want

a more strategic relationship," he explained.

The Oracle president also fleshed out his company's

hiring plans

. In addition to its recruitment drive, Oracle will be offering significant financial incentives to its sales teams.

"We want the all-stars, we want the Derek Jeters," he said. "We're going to pay you more than you're making now."

Oracle, which beat Wall Street's estimates in its recent

second-quarter results

has already absorbed acquisitions such as



Siebel Systems

, although Sun, with around


employees, poses a much bigger challenge.

"We have been spending the last nine months putting together very specialized integration plans and playbooks," explained Jeff Epstein, Oracle's CFO, during a presentation this afternoon. The delay in completing the acquisition, he added, has given Oracle more time than it would usually have to work on its integration plan.

Epstein also explained that Oracle expects to grow its R&D investment to $4.3 billion in fiscal 2011, its first full year following the Sun acquisition.

Investors were largely unmoved by the all the noise coming out of Oracle on Wednesday. The company's shares dipped 8 cents, or 0.34%, to $23.80 million despite a modest advance in tech stocks that saw the Nasdaq gain 0.47%.

-- Reported by James Rogers in New York

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