Are Oracle And PeopleSoft Running To a Standstill?
Yet as the drama drags on with no obvious end in sight, it's becoming clear that the three companies had better not put the cart before the horse, miss the forest for the trees and so on. (Insert your favorite cliche here.) The intensely personal part of this exercise, with ex-Oracle exec and current PeopleSoft CEO Craig Conway exchanging very public barbs with his old boss Larry Ellison, has been highly entertaining.
But as we all know, it's not personal; it's just business, and the business reality is that none of these companies can afford a protracted battle, legal or otherwise, that will distract them from their long-term goals. Moreover, the nature of enterprise software has begun changing in such a way that may make them want to rethink what their long-term goals actually are.
When the news of Oracle's bid first broke, a lot of the initial advice given to customers and VARs was of the wait-and-see variety. We don't have any choice but to await the outcome, of course, but customers and VARs don't have the luxury of postponing purchases, upgrades and implementations because they're uncertain whether Oracle will support their PeopleSoft tools or which product lines a newly merged PeopleSoft and JD Edwards will combine. They need to act now to preserve and enrich their relationships with their other partners.
If this M&A battle rages on, these partners will have no choice but to move on to other vendors or platforms, and they may find that it's in their best interest to do so anyway. This week, Ventana Research, a consultancy in Belmont, Calif., released an article saying all the will they/won't they hoopla over these potential unions is overblown. Ventana CEO Mark Smith, who wrote the report, says the most valuable revelation this episode might provide to partners is the conviction that they should move away from, if not abandon, the enterprise software models that built these companies.
Smith says Oracle's and PeopleSoft's "transactional-centric" applications have passed their prime and are now in decline, and that these companies' partners should see it as an opportunity to revamp their systems around a performance-management model, partnering with vendors that are more schooled in the business intelligence (BI) space, a list that includes, among others, Actuate, Cognos, Business Objects, MicroStrategy, Crystal Decisions, Informatica and Information Builders.
It's no coincidence that some of these companies have PeopleSoft and Oracle DNA, because they've merely taken what they learned about enterprise software and applied it to the future. (While we're at it, we might as well add Salesforce.com to the list. Led by ex-Oracle exec Marc Benioff, the company has evangelized its anti-software/pro-services model with a hype reminiscent of the late-'90s; last month the company hosted a lavish event in San Francisco that treated guests to the premier of "T3: Rise of the Machines" and an appearance by the Terminator himself.)
The point is, a combination of any two or all three of these companies would doubtless create a formidable enterprise software titan. But the longer the soap opera drones on, and the longer it takes the players to anticipate and incorporate the future face of software into their own product lines, the more it puts them all in danger of becoming yesterday's news.
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