It beat the Street and its own projections Thursday when it reported its fiscal Q4 numbers. Revenue was up 39% and income was up 25%. That translates into a record 46 cents a share on $9.5 billion – 60 cents non-GAAP on expectations of 54 cents – with new software licenses up 14% to $3.1 billion. License updates and product support revenues were up 12% to $3.4 billion.

Oracle estimates that Sun reduced its $3.3 billion operating income by approximately $100 million, including $176 million of amortization, and contributed about $400 million to non-GAAP operating income, which was up 26% to $4.4 billion.

It was Oracle’s first full quarter with Sun in tow.

CFO Jeff Epstein said in a statement, “We executed better than expected on both the top and bottom line for the quarter. This strong performance plus disciplined business management led to a non-GAAP operating margin of 46% in Q4, fully including the $1.2 billion of Sun systems hardware that we sold in the quarter.”

Citing Sun’s $400 million contribution, president Safra Catz said, “This compares with a loss in Sun’s quarter ending June of last year, when Sun was an independent company. Now that Sun is profitable, we have increased confidence that we will meet or exceed our goal of Sun contributing $1.5 billion to non-GAAP operating income in FY2011, and $2 billion in FY2012.”

Catz pointed out that Oracle had dumped hundreds of millions of dollars worth of third-party gear that Sun sold. She also said that Oracle was getting a handle on Sun’s supply chain. She said Oracle will need a year to understand Sun’s seasonality and conversion rates.

CEO Larry Ellison bragged that the Sun Exadata database machine was being bought by some of IBM’s largest and bluest accounts like Bank of America and that its FY2011 sales pipeline is fast approaching $1 billion.

Ellison also said that Oracle means to “dramatically grow the Sun salesforce and grow the business rapidly.” Despite the layoffs in Europe and Asia, it is hiring.

Although Oracle means to hold on Sun’s channel it will be going more direct.

Oracle also claimed to be beating the pants off SAP and taking share. According to its calculations, “over the last 12 months Oracle’s applications business has grown 5% on a constant dollar basis while SAP’s business has declined 24% over their previous four quarters. This trend has been going on for a long time: Oracle’s applications business has grown 60% in the last four years while SAP’s business is 7% smaller than it was four years ago.”

President Chuck Philips said the company is attaching so-called client architects to account to act as effective CTOs and try to guide data center decisions.

Oracle realized an operating margin of 35%. GAAP operating cash flow on a trailing 12-month basis was $8.7 billion.

Catz said she was consciously conservative in guiding revenues up 44%-48% on a non-GAAP constant currency basis or 41%-45% at current exchange rates this quarter with a non-GAAP EPS of 36 cents-38 cents. She figures new software license revenues will be up 4%-14% in constant currency, 2%-12% at current exchange rates and that hardware revenues – sans support – will be about a billion dollars.

No more perpetual use of the operating system without coughing up some dough. Oracle says any downloads of Solaris 10, the stable version of the Sun operating system, are only good for a 90-day trial then you have to pay for a support contract to keep using it.

Under Sun’s administration it was free for the price of a valid e-mail address and a form specifying the number of systems the stuff would be running on.

OpenSolaris, the free community version, is not impacted – at least for the moment – but as a monetizing inducement, shall we say, it looks like Oracle may not open source new features being developed for Solaris.

Oracle’s director of Solaris product management Dan Roberts let it be known that “There may be some things we choose not to open source going forward similar to how MySQL manages certain value-add at the top of the stack. It’s important to understand the plan is now to deliver value again out of our IP investment while at the same time measuring that with continuing to deliver OpenSolaris in the open.”

InfoWorld discovered the policy change, which set off dire predictions in the blogosphere about how users will flee Solaris for free Linux – which the free Solaris was meant to counter – or jump to non-Sun distros such as Nexenta, Schillix and Belenix and create a rift between Oracle and the OpenSolaris developer community.

The move also raised speculation that Oracle will try to monetize Sun’s quiver of open source widgetry like OpenOfffice.

InfoWorld observes that the one-sentence policy restatement doesn’t say that existing unpaid users will be ousted. But the implication sure is there.

It says, “Please remember, your right to use Solaris acquired as a download is limited to a trial of 90 days, unless you acquire a service contact for the downloaded software.”

Meanwhile, the Register says it’s heard the Solaris SystemZ port to IBM’s mainframe is dead – with Oracle closing down key parts of the code to developers – which makes utter sense given Oracle wants to take IBM down.

Widenius will now presumably revert to his quixotic Plan B and appeal the European Commission’s clearance last week, a green light that looked really iffy there for a while.

Oracle CEO Larry Ellison got out ahead of his own announcement Wednesday and started telling the press Tuesday evening that – contrary to Oracle’s usual practice with an acquisition – he intends to hire more people at Sun than he fires.

The next day he tore into the “highly irresponsible” reports last week that claimed that Oracle would lay off half of Sun’s 27,000 or 28,000 people, calling them “garbage” and scolding their Wall Street author and his minions saying they should be ashamed of themselves for making Sun suffer more angst.

It’s still not exactly clear exactly how many more Sun people will get the ax. Heck, it’s still unclear whether Sun cut the 3,000 it said it would in October or if the 27,596 people that worked there at the end of September are still there.

Depending on the moment – as is often the case with Larry – it appears Oracle will cut somewhere between 1,000 and 2,000 people, presumably folks in overlapping functions, and that it means to hire 2,000 more salesmen, engineers and support personnel.

Oracle executives, new and old, were sporting “We’re Hiring” buttons on their lapels Wednesday and promising to pay new hires more than they’re making now.

According to Ellison, “We’re not cutting Sun to profitability. We think Sun’s a growing business.” He expects it to take back share in servers and storage.

Oracle’s CFO Jeff Epstein mentioned something about paying on margins, not revenues. Still Oracle said it means to have the highest-paid sales reps in the business.

Ellison Tuesday struck a go-it-alone pose, seeming to burn his bridges with the IBMs and HPs of the world that sell Oracle’s software on their systems. “It took us a while to decide that we would be better off with all the pieces, and not working with partners,” he told the Wall Street Journal. He probably wishes he hadn’t said that.

He’s apparently intent on dumping Sun’s resellers, though, at least those that don’t add any value, “starting this week.” He didn’t define value and it’s probably a pretty high threshold.

“Sun has wonderful engineering,” he told the New York Times, “but they didn’t seem to like selling very much. The partner model was disastrous, and we are immediately changing that.”

Instead Sun will sell direct – at least to its 4,000 top customers which account for 70% of its revenues – using product specialists this time, not generalists and sales will include two new purpose-built pre-assembled systems designed for Oracle software that are supposed to come out this year. What exactly is unclear.

Oracle’s Exadata data warehouse, the appliance that now runs on Sun hardware rather than HP’s, Oracle’s singular experience with hardware so far, reportedly has a $100 million pipeline – or maybe it’s hundreds of millions. Larry was a little fast and loose with the number.

It may be delusional, but he claims all of Oracle’s myriad database sites are Exadata candidates.

The Exadata box will be expanded into other uses and serve as the model for Oracle’s Back-to-the Future vision of complete, purpose-built, task-specific, integrated systems whose components – from chips through applications – all come from Oracle like the mainframes of TJ Watson’s IBM in those bygone days before PCs and industry-standard servers convinced people that they Swiss Army knives.

Ellison is in the midst of a profound multibillion-dollar love affair with the IBM of the 1960s, which he calls “the most important company in the history of the earth.” Users are supposed to take solace from the fact that Oracle’s retread vision has been done before by Big Blue. It’s supposed to result in all parts and systems being optimized for the purpose they are meant to serve and being cheaper than assembling best-of-breed components from multiple vendors. Oracle even means to replace users’ IT administrators who screw things up when they change things. Not that Sun won’t continue to sell general-purpose machines – it will apparently – but the point of the exercise is application performance.

Oracle claims it’s the only company around that can deliver complete systems: IBM lacks the applications (not to mention that its database is a decade behind and uncompetitive except on mainframes). Microsoft doesn’t have the hardware, management or vertical apps. HP doesn’t have the apps, middleware or a database and its virtualization is thin. SAP just has its horizontal software, a dash of middleware and a thin database.

Frankly Sun under Oracle doesn’t sound that much different than Sun pre-merger.

Like an American Indian making use of all the parts of the buffalo he just killed, Oracle doesn’t seem to be discarding any of Sun’s widgetry – and it took it five hours and scads of overheads just for it to hit the bullet points of its salvage job. At least for the customer-calming moment everything, it seems, even overlapping products, will be sucked up into Oracle’s integration scheme (with Oracle’s remaining ascendant) and in the process Oracle means to jack its R&D budget from $2.8 billion last year to $4.3 billion now that Sun’s on board.

Before Oracle bought PeopleSoft in 2004 and started on its world conquest R&D cost it just $1.5 billion a year. Sun spent $1.6 billion in the year ended last June. Apparently Oracle figures to do more than Sun with a tad less.

The increase in R&D spending is supposed to start in Oracle’s 2011 fiscal year, which begins in June.

The investments will be applied across-the-board to Sparc chips (there’s more on the roadmap now sans Rock), Solaris and Linux, the Sun Ray thin client (ah, remember Larry and the network computer, he’s finally got one), Java middleware, 7000 ZFS storage, Flash, archiving, virtualization and software.

Oracle vowed to improve the problematic open source database MySQL that was almost the merger’s undoing and thrust OpenOffice onto the web with an online version dubbed Oracle Cloud Office aimed at the same enterprise crowd that Google, IBM and Microsoft are shooting for with similar widgetry.

MySQL, part of a global business unit dedicated to open source along with InnoDB, is supposed to be made part of the Oracle stack and integrated with Enterprise Manager, Secure Backup and Audit Vault.

As much as Ellison hates the name cloud computing, Oracle is now in the cloud computing business offering the building blocks for both public and private clouds. He also trashed VMware as “point solution,” lacking Oracle’s integration. “VMware’s not integrated with anything,” he said.

The Java programming model is supposed to be extended to emerging application development paradigms like RIA. Java projects like HotSpot, JRockit, NetBeans – even Glassfish, the Java application server, despite Oracle’s acquisition of BEA – live on but they it won’t be Oracle’s enterprise cards. JavaFX is another matter. Java ME and Java SE APIs are supposed to be unified to recapture Java’s old “write once, run anywhere” formula and ME optimized for new platforms like IP TV, Blu-ray and emerging embedded devices.

Ellison claimed that it doesn’t matter if Sun doesn’t monetize Java. BEA and Oracle make money on Java and now Oracle is bigger than IBM in middleware. “Where the money comes from is less important,” he said.

Oracle continues to maintain that it can squeeze at least $1.5 billion in operating profits out of Sun year one despite the billion in losses the company has wracked over the last decade so it’s been widely assumed that the only way it can do that is by slashing and burning its way across the Sun campus.

Ellison, however, claims making Sun profitable quickly is “very easy to fix.” If so, former Sun CEOs Scott McNealy and Jonathan Schwartz are sure gonna look dumb. Schwartz, by the way, is out; Ellison’s looking for a place to put Scott. Apparently they’re still talking about what his job might be. Can you see Scott working for Larry? Hmmm.

Anyway, one of the ways to this profit nirvana – other than limiting the number of configurations sold – a move reminiscent of 20 years ago when Oracle railed against the cost of supporting so many Unix databases – is to change Sun’s build-to-stock policy to a build-to-order one, a supply chain renaissance that could take until June.

The shift – and Oracle didn’t detail what the savings would be – will involve shipping from a cutback number of plants that make the hardware out of components coming from half the number of suppliers Sun used – and doing away with Sun distribution centers. The plants will drop ship.

Oracle gave the impression that Sun pissed away a lot of money on excess parts inventories, obsolescence, inaccurate forecasts and the freight to return systems that needed to be retrofitted to meet what the customer ordered.

Oracle also figures that leveraging its infrastructure will lower the cost of finance, legal, marketing, HR, procurement, IT and other back-office activities.

Oracle is supposed to use Sun’s line of x86 servers only for high-end clusters rather than compete with HP and Dell for low-margin commodity sales and focus on its high-end Intel-bucking Sparc/Solaris machines. Support is supposed to be automated, standardized and simplified by the fact that the whole package comes from a single supplier that knows all its secrets. Oracle figures Sun will do better if its support attach rates are improved. MyOracleSupport will be the access portal for both Sun and Oracle users.

The European Commission is reportedly supposed to wave Sun’s acquisition through on January 19.

In the process it’ll have to explain how it came to change its mind after needlessly costing the company hundreds of millions of dollars and thousands of jobs – well, at least that’s the Oracle-Sun story.

We always figured Oracle would have had to can those people anyway to wring $1.5 billion in operating profits out of the joint like it said it would. And now UBS analyst Brent Thill says it’ll fire ~13,800 Sun people in the next few weeks.

OK, one thing at a time. Remember that Oracle impugned the EC’s honor and accused it of twisting, cherry-picking and ignoring evidence it collected during its antitrust investigation of the merger to match its open source biases.

Oracle even brought big company witnesses to Brussels to tell the EC to its face that their opinions of potential competitive harm was not what the EC represented them to be.

Well, the EC can’t very well acknowledge that Oracle had it by the short hairs and that – if it didn’t go along with the merger – Oracle could have made a stink that might have weakened its structure as judge, jury and executioner now can it?

That’s where the Oracle-provided wallpaper comes in. The 10 promises about MySQL that Oracle made after the hearing in December handed the EC its cover story. It can plead “new facts” in the case.

Ironically, the EC’s advisory committee of the 27 national EU regulators that met this week to vote on the acquisition reportedly wanted the EC to say that, in the end, its case wasn’t strong enough rather than position Oracle’s undertakings as “new facts” that changed the game. It’s assumed the EC won’t follow that advice.

Anyway, that hurdle all but cleared, what’s Oracle gonna do once it’s out of the valley of the shadow of death, so to speak?

Well, from the beginning Larry claimed that the real reason he wanted Sun was Java. In that case he’s got a little problem percolating in Javaville and it involves Google. It’ll be curious to see what happens.

Since the EC tied the Oracle-Sun acquisition up in knots, Google has been trying to buy On2, which gives Java FX, the embedded Java widgetry that Larry has said he’s interested in making a buck off of, its cross-platform encoding and hardware-based decoding audio/video competency, a facility that extends to browsers and desktops. It’s unique.

Google offered 60 cents a share for the company last year and, although management appeared to be willing the underwater stockholders weren’t, and so Google had to go to 75 cents, a measly $126 million in chump change, a few days ago.

The situation is up-in-the-air and likely to remain there for another month – enough time for Oracle to barge in and make sure that Google doesn’t proprietize the technology for its own phones and netbooks. Or at least that’s the presumption. Google hasn’t said what it wants the stuff for and Java desperately needs it.

Fifty-nine senators from both sides of the aisle led by one-time presidential hopeful John Kerry (D-Mass) and perennial presidential pretender Orrin Hatch (R-Utah) signed a letter to the European Commission asking it to wrap up its investigation of the Oracle-Sun merger as soon as possible pleading Sun’s precarious financial position and its inability to continue to employ thousands of people endlessly under current conditions.

The senators – there are only a hundred of them – tried reasoning proportion with the EC saying, “It is our understanding the Commission is concerned about competition in the database software market. However, we have been informed by Sun Microsystems that their subsidiary, which competes in this specific market, generates only €17 million in revenue and that the same market has competitors with capitalizations of tens of billions of Euros.”

In an explanatory statement accompanying the letter Kerry said, “The deal between Oracle and Sun was announced in April and seven months have gone by without a resolution. Continued delay of the European Commission’s decision on clearance threatens thousands of American jobs, so we felt compelled to ask for a speedy resolution. The EC is within its sovereign rights to set the rules for operation in its market, but with our Department of Justice having made a compelling case that the merger does not pose a threat to competition, it is fair to ask the EC for the basis on which a delay on decision making is warranted and to make a decision one way or the other.”

Hmm. “One way or the other.”

Odd thing about the delay is that Oracle, which has complained to just about everybody about the EC’s foot-dragging, just asked for and got more time ostensibly to develop its arguments.

What use six more days will be to Oracle is a question. The regulator seems intent on blocking the merger unless Oracle divests MySQL, which – come to find out from the senators’ letter only generates a pissant $25 million in revenue, half of what was generally supposed when Sun bought the thing for – be still, my heart – a frigging billion dollars.

Senator Hatch’s statement was a bit testier and mirrors more accurately American public option.

“I have become increasingly concerned about the growing body of evidence that foreign regulatory agencies are unfairly using their review processes to impede the business of American corporations,” he said. “This transaction has been thoroughly reviewed by the United States Department of Justice, which has decided to take no action. Therefore, I hope the EC will quickly conclude their investigation into this transaction.”

The Senate’s letter is the second time Washington has commented on the EC’s intransigence on the Oracle-Sun merger.

On November 9, the day Sun got the EC’s reportedly 155-page statement of objections, the Justice Department issued a statement saying that it had looked at the MySQL issue and concluded that “the proposed transaction is unlikely to be anticompetitive.”

There are plenty of open source and proprietary databases, it said, and so the consumer is unlikely to be harmed. Plus there’s a large community of MySQL developers and users with the expertise to maintain, improve and support it.

Such a thing seems to make no never mind with the EC, which thinks Oracle will adopt a licensing and development strategy that prevents MySQL from cannibalizing its revenues even though hasn’t happened yet and they’re in two separate markets, as Oracle has maintained.

The DOJ’s tone was civil – and although its statement hints – as many people surmise – that the EC is bent on a political agenda having little to do with antitrust issues, relations between the two bodies have yet to degenerate into the prickly tension that marked their affairs after the EC blocked the GE-Honeywell merger a few years back.

Still with each passing day the EC, widely seen as a victim of misguided principle, makes itself a bigger target for the critics who see it as a protectionist haven for every malcontent competitor who can’t cut it in the marketplace; who wonder what bright boy made it judge, jury and executioner; who are uncomfortable with its 16th century Star Chamber-like level of secrecy and its guessing game set of rules; and who question its objectivity, which was recently criticized by its own overseer after reviewing the Intel antitrust case.

European lobbyist Florian Mueller, who’s working for MySQL creator Monty Widenius on opposing Oracle’s acquisition of MySQL – though both men made a killing when Sun bought MySQL for a ludicrous billion dollars – claims the Senate gambit isn’t going to work and that the “revenues argument is pointless.”

“Twitter had zero revenues last year but no one could argue it wasn’t a major force in the market,” Mueller said, suggesting that the 59 senators should send Larry Ellison a letter asking him to commit to divesting MySQL so he can close the transaction quickly.

“Oracle could have a deal any day of the week by giving up MySQL,” Mueller said.

However, John Briggs, an antitrust expert and an old Brussels hand, told Reuters the pressure from the US senators could affect the EC’s decision. In his opinion it “will have a hard time ignoring this.”

OK, so other than Thanksgiving why did Oracle really want more time?

Apparently to bring pressure like it just did with the senators.

Apparently Oracle could have asked for more than six days. Apparently it was the one who asked for the six-day grace period. The God of the Book of Genesis created the world in six days. Does Larry actually expect to change the EC’s mind in an extra six days? God, people say, had an easier job.

Apparently Oracle blew through a November 20 deadline to come up with a remedy. And it now has at least until November 30 to come up with one and avoid an automatic three-week extension of the EC’s final decision, whose dead  line is now January 27 instead of January 19. So if Oracle doesn’t come up with an acceptable solution we could be talking about a final decision on February 17, close to 10 months after Sun and Oracle cut their deal. Meanwhile, the delay is said to be costing Sun a $100 million a month.

Former Ellison lieutenants swear that Larry ain’t as perturbed about the EC’s delay as Oracle lets on, that he ain’t gonna pay the nominal $7.4 billion ($9.50 a share) he offered for Sun (nominal less the money Sun has in the bank) and that he’s going to renegotiate the price down complaining that Sun has been materially damaged by the EC’s dicking around.

They also say that Ellison could give a hoot about MySQL – it would be nice to have and he doesn’t want a serious competitor to have it – but it’s not the reason he’s interested in Sun. Java, Sparc, Solaris and the Sun installed base is what he’s after.

It’s hard to imagine Ellison backing off from this fight but, if he wearies of it, he might offer to dump MySQL into an open source project or foundation like, say, Eclipse, or maybe he just needs six days to cut a handshake deal with a company that won’t do much at all with MySQL and distancing Oracle from the licensing control that seems to have the EC so perturbed.

It can’t control who Oracle might spin it off to.

By way of revenge, if it goes to a player, odds are Oracle will then do whatever’s possible to stomp that sucker flat – even if MySQL isn’t a direct competitor of Oracle’s database.

That said here’s the Kerry-Hatch letter:

Chargé d’Affaires Angelos Pangratis

Acting Head of Delegation

Delegation of the European Commission to the United States

2300 M Street, NW

Washington, DC 20037

Dear Chargé d’Affaires Pangratis:

As fellow government officials committed to the principle that competition is the cornerstone of healthy economic growth, we would like to take this opportunity to share our thoughts with you as to the proposed acquisition of Sun Microsystems, Inc. by Oracle Corporation.  In addition, due to Sun Microsystems’ deteriorating financial condition and the possible negative effect on employment of the company’s workforce, we respectfully request the European Commission expedite the completion of its investigation into this transaction.

The United States Department of Justice, after an intensive investigation, closed its inquiry into this transaction without taking any action. In fact, the Justice Department did not find documentary evidence that this acquisition would harm competition. We recognize that the European Commission has a sovereign right to thoroughly investigate transactions where corporations utilize the European Union’s marketplace. Further, it is our understanding the Commission is concerned about competition in the database software market. However, we have been informed by Sun Microsystems that their subsidiary, which competes in this specific market, generates only €17 million in revenue and that the same market has competitors with capitalizations of tens of billions of Euros.

Unfortunately, Sun Microsystems’ financial position has become more precarious and the Commission’s inquiry has continued. Some have raised concerns over the company’s ability to continue to employ its thousands of workers. Accordingly, we respectfully request the European Commission complete its investigation of this transaction as quickly as possible.

Thank you for your attention to this matter.

See http://kerry.senate.gov/cfm/record.cfm?id=320244 for all the signatures.

Oracle of course picked up Sun after IBM’s negotiations with Sun failed and Oracle made IBM the intended target of the proposed acquisition in an ad on the front page of the Wall Street Journal last week so the idea that IBM is whispering in the EC’s ear makes perfect sense.

And IBM has plenty of practice using the European Commission to attack its enemies. Just ask Microsoft.

Oracle CEO Larry Ellison claims the European Commission’s prolonged investigation of Oracle’s proposed acquisition of Sun, which isn’t expected to finish much before the agency’s mid-January deadline, is costing Sun $100 million a month in revenues and a weakened revenue stream will impact how many employees Sun gets to keep if and when the acquisition is approved.

Ellison, who was interviewed on-stage after a Churchill Club dinner Monday evening by former Sun president and COO Ed Zander of all people, told the crowd, “The longer this takes, the more money Sun is going to lose, and that’s not good for anybody. We want to get this done to save as many jobs as possible.”

Sun’s fretful accounts either just aren’t buying because of the uncertainty of Sun’s fate and continued investment in its product lines or are being run off by IBM and HP. Ditto a lot of its resellers anxious over their revenue streams.

And to meet Oracle’s goal of wringing $1.5 billion in operating income out of Sun the first year after the merger closes, ace Wall Street analyst Toni Sacconaghi now estimates that Oracle will have to fire half of Sun’s people, 15,000 souls.

Ellison said he thinks the EC is going to approve the merger just like the Justice Department did in August without any strings attached.

He said he means to keep all of Sun and won’t sell off any of it, as has been widely supposed he would.

“We are keeping everything,” he said. “We’re keeping tape. We’re keeping storage. We’re keeping x86 and Sparc. And we’re going to increase investment in all of them.”

That means keeping rival open source database MySQL, whose future the EC claims to be so worried about and, it’s been conjectured, may force Oracle to spin it off. Ellison doesn’t think so. Oracle and MySQL serve different purposes, he said, and “do not compete at all.”

“We’re not going to spin it off,” he said, claiming the EC is going to decide the Sun merger is a wholly pro-competitive deal.

The reason he wants Sun and all its satellites is to turn Oracle into the new IBM like Byzantium was the new Rome.

Not the IBM of Lou Gerstner or Sam Palmisano, he said, but the IBM of TJ Watson, “when IBM really was the dominant software company” and its “hardware and software was running most of the enterprises on the planet.”

In Ellison’s opinion, “TJ Watson’s IBM was the greatest company in the history of enterprise in America” and “We think with the combination of Sun technology and Oracle technology we can succeed and beat IBM. That’s our goal. We have a deep interest in the systems business. We think that by combining our software with hardware that we can deliver systems that can be the backbone of most enterprises in America and around the world.”

Oracle, which reportedly doesn’t see Microsoft as a competitor any more, is currently working on a five-year plan to realize Ellison’s dream and Ellison, 65, told Zander he intends to stick around to see it happen.

Cloud computing, a faddish term thought up by “some nitwits on Sand Hill Road,” apparently won’t feature much in the plan. According to Ellison, the cloud’s “not water vapor. It’s databases and operating system and memory and microprocessors and the Internet!”

“All it is is a computer attached to a network.”

“My objection to cloud computing is the fact that cloud computing is not only the future of computing, it is the present and the entire past….What do you think Google runs on?” (http://www.youtube.com/watch?v=KmXJSeMaoTY)

Oracle’s not interested in Sun’s hardware per se but its hardware as the basis for end-to-end systems integrated “at the engineering level” with Oracle’s software. Ellison wants to peddle airline reservation systems and banking systems.

Larry’s quest for world domination will presumably be impeded by what he sees as slow economic recovery. The consumer is tapped out and up to his neck in debt, Ellison said, creating an “L-shaped” non-recovery for the next five years and involving some “fundamental changes.”

Intel is mumbling something about final system-level testing turning up the chance to further enhance the application scalability needed in high-end systems.

Perhaps, but context is missing. The real reason is supposedly Sun’s Sparc chip.

Supposedly the thought of Sparc going to IBM – which would have surely killed the thing in the name of its Sparc-competitive Power chip – put the fear of God into Sparc customers, particularly one very large high-end Sparc server customer that took itself to Intel looking for salvation.

Well, it ran its custom-made, highly threaded software on Itanium and the performance on eight-, 16-, 32-way and higher systems reportedly wasn’t exactly whacha might call stellar. So, Intel and the Sparc client sat down and figured out a way to ratchet up Itanium’s performance, but the solution was gonna take a silicon re-spin.

That left Intel with a decision. Launch Tukwila for two- and four-ways now, and do a second launch for the high end in Q1-ish, or just push out the launch.

Enter Beckton, the eight-core Nehalem-EX Xeon chip whose arrival Intel is supposed to trumpet in a few day. It’s supposedly pretty darn good in the low-end space, and will add some of Itanium’s reliability features. And while some silicon re-spins only take three months or so, Itanium ain’t exactly at the top of Intel’s priority list compared to the Core, Xeon and Atom.

So nothing’s as simple as it looks. The cost of splitting the launches; the priorities in Intel’s factories, and a big-time customer design-win all came into play.

Now Sun is actually going to Oracle, not IBM, and Oracle CEO Larry Ellison is telling people he’s going to keep Sparc and Sun’s hardware going but it costs a way lot of money to keep designing and making sexy microprocessors so in the end Sun could be a tugboat for the chip it used to compare to the Titanic and HP benefits.