Pulling Out of Europe Not Only Feasible for Oracle; Maybe It's a Board Imperative!

Over on Internet News, Andy Patrizio mentioned my November 13 post about Oracle (ORCL) dumping the European Union (EU) rather than MySQL and then tried to come up with some reasons to shoot down the idea.  I have no problem with that. The idea is fair game for argument, rebuttal or even disdain.

But when Patrizio says “It just isn’t feasible,” that’s not the case. It might not be good idea, it might be hard to execute, it might cause problems for customers (but see below for how easily they are handled), it might be more trouble to manage than it is worth (such that the proposed savings do not materialize), etc. But it is definitely feasible. 

In fact, in some cases it is an imperative. Public companies must either implicitly or explicitly take the following position quoted on page 14 of the 2009 Microsoft (MSFT) 10-K:

“We may have to choose between withdrawing products from certain geographies and…”

Boards of directors are obliged by fiduciary responsibility to constantly ask themselves whether they should do it. Is Oracle's board currently so obligated?

As for feasibility, don’t fall into Patrizio’s trap of equating Europe with the European Union. Not all European countries belong to the EU. Perhaps the EU might tell its citizens that they can’t go to (or call) Switzerland or Croatia (or India or Belarus) to get some software fixed.  But I would guess that would be as hard a task as the state of Massachusetts has trying to keep its residents from buying goods over the border in sales-tax-free New Hampshire

As an aside, I did not mean to imply that “Europe's biggest nations (England, France and Germany)” share of Oracle’s revenue is “shrinking because Europe's economy is in worse shape than America.”  I don’t think anything I said even hinted at that. The economies of those countries are shrinking because the countries’ populations are shrinking or growing very slowly. It is a long-term issue and not simply an outgrowth of the Financial Panic of 2008.  

-- Dennis Byron

Comments

[software development london]

Humm... interesting,
Why would you pull out of europe?
Anyway, thanks for the post

[Dennis Byron]

Because the Euracracy has made it cost-prohibitive for US-domiciled software suppliers to do business there. There are a couple of other posts on the blog that explore the subject further.

Thanks

Dennis Byron