Is Oracle About To Go After VMware Virtualization Turf? (ORCL, VMW, CTXS, MSFT, EMC)

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There is market chatter, despite the sell-off, that Oracle Corp. (NASDAQ: ORCL) may play catch-up in the virtualization space.  Jefferies has noted that Larry Ellison and friends may soon acquire privately held Virtual Iron, one of the leading independent virtualization players.  If the rumor is true, Oracle would be taking direct aim at VMware, Inc. (NYSE: VMW).

The key difference between Virtual Iron and VMware is that VMware is the largest and goes after enterprise accounts.  Virtual Iron has won many small to medium-sized businesses.

Virtual Iron is also deemed as being more affordable.  It competes against Citrix Systems (NASDAQ: CTXS) and Microsoft (NASDAQ: MSFT) .   It is also complementary with the Oracle Virtual Machine.  Needless to say, IF Oracle acquires it then Virtual Iron will be in more large businesses  and EMC Corporation (NYSE: EMC) will have more competition for its ex-subsidiary VMware.

We have not tried to reach Oracle, but our inquiry about Virtual Iron has  been unanswered.  We do not expect any comment.

Jon C. Ogg
March 2, 2009