Oracle (Nasdaq: ORCL) has been making waves in the open-source community lately. First, it sued Google (Nasdaq: GOOG) over Java code used in the Android platform. Then the leaders of its OpenOffice.org office suite project broke away to start an independent development line. The way Oracle handles these issues -- or doesn't handle them, as the case may be -- will speak volumes about the value Oracle is getting from its purchase of Sun Microsystems.

When Oracle bought Sun, it was truly a transformative move. For the last decade or so, Oracle had described itself as "the world's largest enterprise software company," but the company tagline these days is "the world's most complete, open, and integrated business software and hardware systems company." Red Hat (NYSE: RHT), Citrix Systems (Nasdaq: CTXS), and Novell (Nasdaq: NOVL) all have good reason to dispute the "most open" claim, and IBM (NYSE: IBM) sounds like a better fit for the entire business description, but there you go: Not only does Oracle think of itself as an integrated hardware and software company now, but openness has also supposedly become near and dear to the company's heart.

This week, Oracle re-upped its open development support a bit. First, it announced continued support of its OpenOffice.org project, but stopped short of throwing its weight behind the LibreOffice offshoot in any way at all. Then the company backed the OpenJDK open-source Java development effort with "pledges to increase both our collaboration with the community and the openness of our development process." IBM also joined that program after years on the sidelines, reportedly because Oracle is willing to have a dialogue with Big Blue, which Sun never was.

If Oracle truly wanted to be open, it would donate the firmly established OpenOffice.org name to the Libre project, drop the Android lawsuit, and join IBM in its efforts to promote and enhance open-source software. In 2005, IBM gave open projects permission to use 500 of its software patents, fee-free and with no legal repercussions. Five years later, IBM is still (shock! awe!) doing great business selling software and support that competes with many of the projects it helped out. Would it kill Oracle to become a good citizen of the open-source world, too? I don't think so.

We know that Oracle could take further steps in this direction, and I contend that it should. Who doesn't love to have a legion of committed developers working for free to enhance your business products? Supporting OpenOffice.org, Java, MySQL, and other bits and pieces of the old Sun the right way would unlock a treasure trove of hidden value. Shouldn't shareholders demand that Oracle optimize the company's billion-dollar transactions?

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