Oracle Fined for Ad Claims

Claims in advertising, no matter how outlandish they may seem, go unchallenged or are simply shrugged off every day as a normal part of capitalist culture.

However, this isn’t the case with the TPC (Transaction Processing Performance Council), a nonprofit that checks on claims made in advertising that involve benchmarks for IT products.

As a result, enterprise middleware giant Oracle on Sept. 30 was fined $10,000 (£6,254) and directed to take corrective action after running an ad in The Wall Street Journal and The Economist claiming that “Sun + Oracle Is Faster” compared with a published TPC-C performance result from IBM.

Oracle’s contention that its database server is faster than one from IBM using a benchmark result it claimed will be announced on 14 Oct “is not supported because Oracle did not have a TPC result at the time of publication,” the TPC said in a statement to the media.

The TPC-C benchmark is an often-used standard for comparing online transaction processing performance on various hardware and software configurations.

The TPC requires that claims based on TPC benchmarks must be demonstrable using publicly available data from official TPC benchmark results. Oracle did not meet that requirement, TPC spokesperson Michael Majdalany told eWEEK.

Oracle, among many other companies, commonly makes claims that its systems are faster than those of competitors. This is not the first time Oracle has been slapped with a fine and such an order to set the record straight, Majdalany told eWEEK.

“But in terms of the TPC’s history, this is the first time we’ve decided to go public with that because we felt that in this case, the violation was serious enough that it warranted a public response from the TPC,” Majdalany said. “There have been companies that have been found in violation in the past, and some of them have been fined as well.”

Sun Microsystems was not deemed liable in this case. “This was strictly an Oracle ad, and it was on the Oracle Website,” Majdalany said.

Oracle did not respond immediately to a request for comment.

In other news involving Oracle, the Wall Street Journal reported 30 Sept that it saw documents stating that the European Commission, which is currently performing due diligence on the company’s proposed $7.4 billion acquisition of Sun, may object to Oracle acquiring the open-source MySQL database as part of the Sun deal.

The European Union is concerned that the merger will hinder competition in the enterprise database business. Oracle, with its acquisitions of PeopleSoft and Siebel, already owns nearly half of the enterprise parallel database market. IBM, with its DB2, comes in at around 22 percent. Microsoft SQL Server has about 19 percent, with Sybase, Teradata, Ingres and Sun’s open-source MySQL making up most of the final 9 percent. Oracle would control more than half the market following the Sun acquisition, most analysts agree.

But Oracle is reluctant to give up Sun’s MySQL database because it gives it a legitimate competitor to Microsoft’s SQL Server, the market leader in the midrange IT segment.

The U.S. Department of Justice, the nation’s antitrust law enforcer, sanctioned the Oracle-Sun deal on 20 Aug.

But the deal cannot proceed until the European Union makes its own decision. The commission has until 19 Jan to rule on the takeover.

Meanwhile, Oracle CEO Larry Ellison said recently Sun is losing about $100 million per month—due largely to uncertainty among its customers about whether the deal will be completed.