Oracle has announced this morning that it will acquire Sun, putting an unexpectedly quick capstone on what could have been another interminable walk through the desert after the Sun/IBM deal fell through last week. The companies report that the deal will come to $7.4 billion with Oracle paying $9.50 per share, cash, trumping IBM's reported final offer of $9.40 per share.

After the IBM deal fell through, Oracle had been rumored as a possible suitor, specifically in combination with HP, but as eWeek put it at the time, "...none of these options seems very attractive unless Sun is getting downright desperate."

There's no question that Larry Ellison is a far smarter guy than me, but it doesn't strike me as being a particularly great time to be getting into the hardware business. A deal including HP would have made marginally more sense; I just don't see a hardware component being the missing ingredient to Oracle's success. It does, on the other hand, give the company end-to-end control over their platform, with something like 3/4 of Oracle deployments running on Sparc systems already. There are undoubtedly some benefits to that level of control, but hardware/software integration issues haven't appeared to me as a massive roadblock to Oracle adoption. Some commentators are casting it as a threat to IBM, but if it is, I don't see it as nearly as significant as most of the pre-existing threats Big Blue is facing already.

What has been an obstacle to Oracle in the software realm is the wildly popular open-source database alternative MySQL, which Sun acquired early last year. This is somewhat akin to the fox buying the henhouse, and it doesn't bode well for corporate support of MySQL, which may put a cramp in some of the customary arguments for the advantages of free open-source software.

On the whole, however, this seems like a suprisingly good deal for both parties (or at least it surprised me, and the commentators I'm watching on CNBC right now) and it's interesting that it got such short shrift as recently as last week.