Channelnomics

 

Oracle Building Channel Empire on HP Talent

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Yes, Oracle threw former Hewlett-Packard CEO Mark Hurd, a staunch channel advocate, a lifeline when he was unceremoniously fired in August 2010. Yes, Oracle lured away former Americas channel chief Adrian Jones to head up hardware sales in Asia. But the defection of Tom LaRocca, the architect of the PartnerOne program and keeper of HP’s channel flame, is nearly earth-shattering.

CRN reported yesterday LaRocca joined Oracle as vice president of worldwide product strategy and alliances. Neither Oracle nor HP have commented on the appointment; it was LaRocca who likely inadvertently broke the news by updating his Linked In profile (an increasingly common occurrence).

While Hurd has played a significant role in the intense HP-Oracle feud and Jones is at the center of a legal dispute launched by HP following his defection, it’s LaRocca move that actually reveals more about Oracle’s future ambitions in the market and channel.

Oracle’s channel is currently under the apt leadership of Judson Althoff, senior vice president of worldwide alliances, channel and embedded sales. He reports directly to Hurd, who oversees Oracle’s nascent hardware business and the rehabilitation of the assets acquired through Sun. In the past two years, Althoff has distinguished himself by advancing programs that incent and reward channel partners for performance in strategic initiative, particular in hardware and software packages such as Exadata.

While Oracle is a strong company, it remains primarily enterprise-focused, and its channel is relatively aligned around alliances rather than resellers. Additionally, hardware has been the soft spot in the Oracle portfolio, as Sun server and appliances continue to lose market share despite Oracle’s efforts.

HP has the opposite problem. Despite its well-documents issues of the last year, it’s hardware sales remain relatively strong and ticking up. HP’s networking products (switches and routers) are increasing sales and market share, and HP retained its leadership position in servers. Where it hasn’t gained any traction is in software.

Over the last five years, HP has made several major and minor software acquisitions and development efforts. The latest foray is the $10 billion acquisition of Autonomy, a specialist in enterprise and database search. Several analyst and channel partners believe Autonomy and its software are a distraction from HP’s core hardware business. Nevertheless, HP says it remains committed to developing the software business.

Part of Oracle’s challenge may be self-inflicted, as CEO Larry Ellison himself offended many Sun partners during the acquisition by saying he would jettison many in favor of direct sales. What he really meant was that Oracle would focus on better-performing partners, but that’s not how the message was received.

Poaching LaRocca may be part of a long-ball strategy for Oracle to break out of its hardware funk and revitalize its hardware channel. By bringing over a channel strategist with a track record for success like LaRocca, Oracle is signaling its intent to build a stronger, more engaged and more productive channel program that would span enterprise to midmarket.

The implications are significant as it would indicate Oracle intends to broaden its market reach and revenue through more channel partners. LaRocca is the executive who can do more than just build the strategy; he can build bridges to legions of enterprise and midmarket solution providers with experience selling hardware solutions and that need access to software and cloud products.

The first official indication of LaRocca’s new position will be a lawsuit by HP, if the company remains consistent on how it handles such defections. That will also reveal the value it places on LaRocca’s loss.

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