Oracle has been targeting Indian companies as the new object of their corporate affections.  With a highly educated workforce that’s relatively fluent in English and a huge population of eager workers willing to work for a fraction of what a North American or European employee would accept (and I’m not kidding when I say “huge population”- we’re talking 1,241,491,960 people), India can be considered a tech entrepreneur’s dream. Many multi-national tech firms, including Microsoft, IBM and Oracle have offices in India, and there are many successful tech firms with headquarters in India, like Wipro, Infosys and Mahindra Satyam. Other than the IT and business process outsourcing industries, India also holds a competitive place in many other sectors, including textiles, chemicals, food processing, steel, mining and pharmaceuticals.

For a company like Oracle, the question generated by this situation is not “how will this benefit the people of India?” nor “will this hurt the American economy?” The question that comes to mind is, “how do we profit from this?”

Currently, Oracle’s rival SAP controls much of the Indian market. Oracle needs to figure out how to wrestle that away from them. The old logic that SAP is good for ERP, Oracle for databases and everything else is a tossup has died a bit harder in India than in other countries. A strong advertising campaign is the first step- A current Oracle ad in India proclaims that “Oracle surrounds SAP,” noting that 96% of SAP customers also run Oracle applications.

Will Oracle be successful in its Indian adventure? Can Larry Ellison prevail where even Alexander the Great failed—the total domination of the Indian subcontinent? Maybe, although the jury is still out. Oracle’s areas of expertise line up almost perfectly with India’s strongest industries. My advice to SAP – If you want to hang on to the Indian market, you need to remain competitive in the realms of CRM, hardware and pharmaceutical software. If you can’t do that, you’re a goner.

Quick refresher, as this case has been going on for a very, very long time: way back in the late 90′s, TomorrowNow started as a company that specialized in upgrading and providing technical services to PeopleSoft systems. In 2002 they branched out to provide third party support for various kinds of enterprise software, including both PeopleSoft and JD Edwards. TomorrowNow was purchased by SAP in 2005; PeopleSoft was purchased by Oracle the same year.

In 2007, Oracle slapped SAP with a lawsuit accusing them of “corporate theft on a grand scale” due to TomorrowNow having downloaded thousands of documents and programs from Oracle’s Customer Connection technical support website using logins of Oracle customers whose support contracts had either already expired or were about to.

SAP briefly tried to argue that TomorrowNow had been entitled to download the materials as they had been contracted to perform third party support; that didn’t last long. In the end, it came down to TomorrowNow being pretty obviously in the wrong and the only question being how many millions were owed to Oracle– Oracle claimed it was billions, not millions, using the argument that each of the clients who employed TomorrowNow’s services would otherwise have employed Oracle Support. At one point, a judge awarded Oracle $1.3 billion, but another judge threw that verdict out.

That Oracle would get a quick admission of guilt and willingness to bargain was not at all a forgone conclusion. To see a very different outcome, take a look Oracle’s lawsuit on another third party support firm, Rimini Street. Interesting side note: Rimini Street CEO Seth Ravin was a founder of TomorrowNow. Hmmmm.

SAP has agreed to pay the $306 million, hoping to avoid yet another trial. Oracle says that agreement only paves the way for an appeal. What do we here at Eye on Oracle have to say about this decision? Well, At least Oracle’s winnings come close to matching their losses in the HP trial. At this rate, they might just break even…

A few months ago, the buzz was that SAP might just do the unthinkable and license certain applications for use to Oracle. Since Oracle and SAP are kind of sort of kind of mortal enemies at this point, it seemed pretty shocking at the time.

Well, no more wondering when and if such a thing is going to happen for real, since it just did.

As of Monday, April 30, Oracle announced that SAP applications are now certified for use with Oracle SPARC SuperCluster T4-4, and SAP infrastructure and applications based on the SAP NetWeaver technology platform 6.4 and above and certified with Oracle Database 11g Release 2, such as the SAP ERP application and SAP NetWeaver Business Warehouse, can now be deployed using the SPARC SuperCluster T4 4. Oracle also made sure to point out that “…the SPARC SuperCluster T4-4 provides an optimized platform for SAP environments that can reduce configuration times by up to 75 percent (1), reduce operating costs up to 50 percent(2), can improve query performance by up to 10x(3), and can improve daily data loading up to 4x(4).”

Long story short- While SAP and Oracle might not be BFFs just yet, they do seem to realize that their software has the potential to integrate very well. It will be interesting to whether this ushers is a new era of cooperation between Oracle and SAP… or not.

Oracle had 48.8% of the market in 2011, according to Gartner. That was up from 48.2% in 2010. IBM with its DB2 database and Microsoft with its SQL Server databases were 20.2% and 17%, respectively. Thanks to Colleen Graham, a research director at Gartner, I have the rundown:

As you can see, Oracle’s growth was the largest in terms of raw dollars, and second largest in terms of percentage. The largest percentage growth went to SAP/Sybase, which already has Sybase databases and is trying to ramp up its database business further with the SAP HANA in-memory appliance. But its percentage growth is largely because it was starting from a smaller base. Can SAP really be the #2 database vendor by 2015, as it hopes to be? For that to happen, it would have to at least quadruple its database business in the next four years.

According to a Wall Street Journal blurbon the press conference, Snabe said that SAP is “ready to go for leadership in two new categories; namely the database business and the cloud business.”

The database business is one in which Oracle owns almost 50% of the market share. SAP, at about 2%, is barely a blip on the screen. And yet no one should be that surprised by Snabe’s comments. SAP is lining up its in-memory High-Performance Analytic Appliance (HANA) against appliances from Oracle such as Exadata and Exalytics. SAP has been pushing the in-memory database message for a while now, and is placing a bet that more companies will move toward in-memory for better performance.

Can SAP become a leader in databases? It is certainly possible, and not without precedent. IT companies rise and fall, and sometimes it happens quickly. I remember a few years back when Sun Microsystems started getting into the x86 server space. The company quickly built up its share competing against the likes of big boys IBM, HP and Dell. Then as Oracle acquired Sun, the company’s share in the x86 server market is going down just as rapidly, as Oracle is uninterested in selling low-margin x86 hardware. So certainly these are grand proclamations by SAP, but still worth keeping an eye on.

Oracle maintained its position as the second-biggest maker of ERP software behind SAP. According to Gartner, Oracle had $2.6 billion in ERP revenue in 2010 compared to $2.4 billion in 2009. That almost 8% growth was higher than the 5.5% growth in the whole industry.

SAP had almost $5.4 billion in ERP revenue in 2010, almost twice as much as Oracle. Other top ERP vendors include Sage, Infor, Microsoft and Kronos. Overall, the top 10 vendors account for 62% of the market. SAP and Oracle alone account for almost 40%.

First of all, Larry Ellison’s attempts to subpoena Leo Apotheker — even going as far as to hire private eyes to track down the HP CEO — have ultimately failed. Ellison’s lawsuit is now in the hands of a jury, and Apotheker managed to stay away from the courtroom while on a supposed world tour visiting with HP employees and customers.

Apotheker seems to have gotten the last laugh, too. While talking to reporters after Monday’s earnings call, one reporter asked him where he was, to which Apotheker replied:

“You mean physically right now? That’s a bit of an odd question… in Palo Alto, at HP’s headquarters together with a bunch of people. Would you like a picture?”

The success of HP’s earnings call extends far beyond Apotheker’s comments. Not only did the company outperform expectations and become more profitable and gain market share, but it gained market share in its most profitable segments, according to an article in Barron’s. Apotheker praised HP, noting that a “competitor” has been unsuccessful in its attempts to distract the company.

Reports have also surfaced today that HP is dropping Oracle Siebel for Salesforce.com as its internal CRM provider.  This would be a huge loss to Oracle, since if the deal goes through, HP would replace 35,000 to 40,000 seats of Oracle Siebel with Salesforce.com. Trip Chowdhry, an analyst at Global Equities Research, has said that Oracle is “very furious” after hearing this news.

As HP becomes more of a threat to Ellison and Oracle, how much longer will the Oracle-HP alliance be able to survive?

Oracle has issued a subpoena for Apotheker, who is now the CEO of HP. But HP has refused to accept the subpoena, claiming that Ellison is only doing this to discredit HP as a competitor and that the software giant had plenty of chances to question Apotheker when he still worked at HP.

We all know Ellison doesn’t go down without a fight. Last week, my colleague Mark Fontecchio wrote this about Ellison: “He probably has people camped out in bushes outside HP headquarters waiting to jump out and serve Apotheker his subpoena. And no, I’m not exaggerating (OK, maybe a little).”

But as the latest development in the search for Apotheker emerges, we learn that there may actually be no exaggeration here.  Ellison has hired a private eye to find the HP CEO, numerous sources have reported.

And if the private investigators can’t find him, others have their own theories as to Apotheker’s whereabouts.  A #findleo hashtag has even emerged on Twitter, with one user guessing Apotheker is in Nicaragua at Ponderosa visiting with 1^st jury member Alina, referencing the current TV show “Survivor: Nicaragua.”  Another Twitter user asked, “Who is that bloke caddying for Tiger Woods?”

It appears that Oracle and Ellison are using the trial as an opportunity to drag HP and SAP, two of its biggest competitors, through the mud.

Ellison has been said to have paraphrased Khan’s quote, and it is fitting. Ellison is a ruthless corporate competitor. He is well known to be steeped in ancient Japanese (and overall Asian) culture, and in particular, is a fan of Sun Tzu’s “The Art of War.” That book has become popular among businessmen, football coaches, and even American heiresses. In other words, people who have no idea what real war is like. I mean, do you think Sun Tzu would really be pleased with this tree of followers?

So let’s get to Ellison’s recent statement, in its entirety (my bolding):

“A few weeks ago I accused HP’s new CEO, Leo Apotheker, of overseeing an industrial espionage scheme centering on the repeated theft of massive amounts of Oracle’s software. A major portion of this theft occurred while Mr. Apotheker was CEO of SAP. HP’s Chairman, Ray Lane, immediately came to Mr. Apotheker’s defense by writing a letter stating, ‘Oracle has been litigating this case for years and has never offered any evidence that Mr. Apotheker was involved.’ Well, that’s what we are planning to do during the trial that starts next Monday.

Unless, Mr. Lane and the rest of the HP Board of Directors decide to keep their new CEO far, far away from HP Headquarters until that trial is over. If HP keeps Leo Apotheker far from HP headquarters we cannot subpoena him to testify at that trial.

I don’t think Ray Lane wants to risk Leo Apotheker testifying under oath as to why he allowed the theft of Oracle property to continue for 8 months after he was made sole CEO of SAP. I hope I’m wrong, but my guess is that HP’s new Chairman, Mr. Lane, will keep HP’s new CEO, Mr. Apotheker, far, far away from the Courthouse until this trial is over.”

Wow. Essentially what Ellison is doing is trying to prevent HP from conducting business by threatening Apotheker with a subpoena. Talk about wanting not only to succeed, but to crush the competition. This also falls in line with “The Art of War” mantra that wars are won before they are fought. Ellison is trying to intimidate HP. Either Apotheker shows up to his job as CEO and gets dragged through a long trial, or he doesn’t show up and his perceived guilt in the case is assumed.

But how would Ellison and Oracle even know if Apotheker shows up to HP’s Silicon Valley headquarters? Most likely, they have a way. He likely has surveillance, and he likely has moles within HP. He probably has people camped out in bushes outside HP headquarters waiting to jump out and serve Apotheker his subpoena. And no, I’m not exaggerating (OK, maybe a little). Just take a look at this presentation from 2001 that Oracle gave at the Strategic and Corporate Intelligence Professionals conference. Here’s a sample slide:

“LJE” stands for Larry J. Ellison. Note the comment about “intelligence agents.”

It’s also worth noting that Oracle is not calling either Shai Agassi or Seth Ravin to testify. Agassi is the former president of the products and technology group at SAP who orchestrated the acquisition of TomorrowNow. Ravin ran TomorrowNow. You’d think Oracle might want to question two people instrumental in knowing whether the whole TomorrowNow business model was in fact illegal. I mean, isn’t that the basis for this whole trial? Or maybe, just maybe, this is one big circus, and Ellison is trying to be the ringmaster.

There is one Sun Tzu quote that Ellison doesn’t seem to follow to the letter: “Be extremely subtle, even to the point of formlessness.”

Subtle? Larry Ellison? I don’t think so.

You’ll remember Ellison lashing out at HP for forcing Mark Hurd to resign, and then after Oracle hired Hurd as co-president, you remember Ellison lashing out at HP for suing Mark Hurd, a legal fracas that settled quickly. So now the lashing continues.

“I’m speechless,” Ellison wrote in an email to the Wall Street Journal. “HP had several good internal candidates…but instead they pick a guy who was recently fired because he did such a bad job of running SAP.”

Ellison continued: “The HP board needs to resign en masse … right away.  The madness must stop.”