HP To Oracle: You Owe Us $4 Billion For Screwing Up Our Server Business

Larry EllisonOracle CEO Larry Ellison in the hot seat.

Photo: Business Insider

Aha! Here’s why someone is leaking the news that HP will lose $4 billion on its Itanium servers by 2020. That’s the damages that HP will seek from Oracle if it gets a chance.HP and Oracle are in court right now arguing over whether Oracle violated a contract with HP.  It decided that it wasn’t going to make new versions of its software for HP’s high-end Itanium servers.

If the court rules that Oracle violated its contract with HP then HP will sue for damages.

If Oracle is found to have breached the contract and is forced to port its next generation database to its rival’s server, then HP will sue for about $500 million in damages, reports BusinessWeek.

If Oracle is found to have breached the contract and is not forced to make its next version of software run on Itanium, then HP thinks Oracle owes it $4 billion. All of this is based on estimated loses HP thinks will happen from customers not buying Itanium anymore.

This fight started when Oracle hired ex-HP CEO Mark Hurd. HP sued. The two settled. As part of that settlement, Oracle promised that it would “continue to offer its product suite on HP platforms … in a manner consistent with [the Oracle-HP] partnership as it existed prior to Oracle’s hiring of Hurd.”

HP says this means that Oracle has to keep making new versions of its software run on HP’s special Itanium servers. Oracle says, nah-uh, it only has to keep selling its existing software and supporting joint customers.

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