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It didn't sound like a big deal: Oracle (Nasdaq: ORCL  ) has decided, after careful consideration, to stop developing software for the Intel (Nasdaq: INTC  ) Itanium chip architecture.

Oracle says it didn't see a commitment to the technology from Intel, and other enterprise software giants had already gone there … and then left. Microsoft (Nasdaq: MSFT  ) used to have a Windows version for Itanium, but stopped support of it. Linux vendor Red Hat (NYSE: RHT  ) also got on board, then jumped ship.

Itanium co-developer Hewlett-Packard (NYSE: HPQ  ) is now just about the only major supporter of the chip other than Intel itself, and might as well take the darn thing off Intel's hands already -- nobody else would really care. And Intel seems ready to supplant the Itanium with the upcoming Knight's Corner architecture anyhow. Don't cry for Paul Otellini.

From that perspective, Oracle's little announcement made perfect sense, and it shouldn't have raised anyone's hackles.

Alas, Intel and HP don't see it that way. Intel immediately reaffirmed its Itanium plans and highlighted product plans two generations into the future. "Intel's work on Intel Itanium processors and platforms continues unabated with multiple generations of chips currently in development and on schedule," Otellini said in a statement.

Alright, so maybe Oracle jumped the gun. But wait, there's more!

HP crossed its arms, wagged an angry finger, and started calling Oracle names. "Oracle continues to show a pattern of anti-customer behavior as they move to shore up their failing Sun server business," said server chief Dave Donatelli. HP proudly claims an Itanium roadmap stretching a full decade into the future.

Oracle's actions could cost its customers "hundreds of millions of dollars in lost productivity," according to HP, though HP will be happy to provide Oracle support on its HP-UX Itanium servers for a very long time.

In that light, Oracle comes across as a malicious imp throwing trouble HP's way, just because the companies are now direct competitors. And HP becomes a vengeful, jilted partner who takes even a small slight as a personal and serious insult.

In the grand scheme of things, none of this matters: Itanium is a tiny part of Intel's revenue. HP itself already sells big-iron servers with Intel's Xeon chips or even MIPS Technologies (Nasdaq: MIPS  ) processors inside, so the company isn't completely locked into the Itanium solution.

So HP vents a little steam, Oracle will ignore it, and perhaps Intel takes this opportunity to sell Itanium to its staunchest defender, HP. And that's the end of that.

To play along at home, just add Intel, Hewlett-Packard, and Oracle to your Watchlist today.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. Intel and Microsoft are Motley Fool Inside Value recommendations. The Fool owns shares of and has bought calls on Intel. Motley Fool Options has recommended a diagonal call position on Intel. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of Microsoft, and Oracle. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.

Read/Post Comments (3) | Recommend This Article (1)

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  • Report this Comment On March 24, 2011, at 1:01 PM, qweryuiooiuy wrote:

    The auther clearly has not done his research, and does not know the unix landscape. Itanium servers from HP is a multi-billion dollar business. HP has overtaken revenue share in the unix market from Oracle/SUN (though they trail IBM) about 2 years ago and it continuing to widen the gap. Instead of Oracle producing a better, more competitive product to regain market share, they merely cut HP customers off of their database and remove HP from the market. Unfair and screwing the customer is what they are doing, and it WILL cost customers hundreds of millions of dollars if Oracle does not change their decision.

  • Report this Comment On March 24, 2011, at 1:07 PM, qweryuiooiuy wrote:

    What is next for Oracle customers? No more AIX version, no more Oracle on Dell/IBM/HP x86 servers - only Oracle x86 servers? Good luck and keep drinking the Oracle koolaid and soon enough you will be locked in to Oracle hardware (which they have proven to not be competitive) and software, which they love to keep increasing the support costs and not care about customers.

  • Report this Comment On March 24, 2011, at 3:45 PM, ibankingcrooks wrote:

    Fortune 500s who choose Oracle are morons. You can't charge millions for vertically integrated software to run on million dollar plus platforms and then just drop support. In the end, and it will take time..., this will be Oracle's undoing. But boy I am looking forward to it.

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