The prospect of an in-depth European antitrust review of its acquisition of Sun Microsystems Inc. (JAVA) could add to the challenges Oracle Corp. (ORCL) faces integrating the server, storage and software giant.

The European Commission, the European Union's competition body, is hesitating on whether to clear the database giant's $7.4 billion deal to buy Sun or launch a full probe that could take up to four months to complete, according to a person familiar with the authority's thinking. The commission must decide by the end of Thursday.

Any delay could spell more difficulty for Redwood, Calif.-based Oracle, which has already watched Sun begin to bleed market share in high-end corporate servers. Many customers are bolting to machines made by competitors, like International Business Machines Corp. (IBM), because of the uncertainty surrounding approval of the deal and Oracle's product road map for Sun, analysts say.

Questions have also been raised as to how much support Oracle will be able to provide for Sun hardware in the future. For example, European regulators might require Oracle to divest part of its business before giving their blessing to the deal. Separately, there is some speculation that Oracle could seek to spin off certain Sun hardware units if they don't complement its product road map.

Oracle, which has already pledged to make the Sun acquisition accretive as soon as possible, might also hold off on spending for research and development, as well as support, to reach that goal. Oracle has said it expects Sun to contribute $1.5 billion to its non-GAAP operating profit in the first year of ownership, a goal that will require Oracle to make tough choices.

"The central issue is how willing or patient (Oracle Chief Executive) Larry Ellison is willing to be in righting Sun's hardware ship," said Charles King, an analyst with Pund-IT. "I think it's going to be harder and more painful than they expected."

An Oracle spokeswoman didn't return calls seeking comment. A Sun representative declined to comment.

Some Oracle customers say the concerns are misplaced. They point to Oracle's speedy integration of past acquisitions as reasons to be confident the company will handle Sun efficiently.

"If you look at previous Oracle acquisitions, they spelled out their market direction within the first few months," said Ian Abramson, president of the Independent Oracle User Group. "I'm expecting the same with Sun."

Many of Oracle's large database customers use Sun's hardware.

And European regulators may approve the deal - as U.S. authorities did - without asking for any concessions. The European Commission is most concerned about Oracle obtaining Sun's database product, not the server business, according to the person familiar with the regulators' thinking.

Still, evidence the uncertainty is weighing on Sun is cropping up in market data.

In the second quarter, Sun's server revenue posted a year-on-year 37% decline to $981 million, research firm IDC said on Wednesday. Though all server makers posted big falls, Sun's was the largest and its market share dropped to 10% from 11.1%. IBM saw revenue fall 26.3%, but its market share improved to 34.5% from 32.7%.

IBM says that in recent months its own server business has benefited from the uncertainty around the future of the Oracle-Sun deal. Inna Kuznetsova, director of IBM Linux strategy, said the Armonk, N.Y.-based technology giant has won more than 250 customers from Sun in the first half of 2009 and the pace accelerated in the second quarter.

Analysts say moves like that underscore the challenges Oracle will have with Sun.

"We project Sun's position to slip further in coming quarters in an intensely competitive environment," Standard & Poor's Equity Research analyst Tom Smith said in a note to clients.

-By Jessica Hodgson and Jerry A. DiColo, Dow Jones Newswires; 415-439-6455; jessica.hodgson@dowjones.com

(Peppi Kiviniemi in Brussels contributed to this report.)