I hadn’t met Jeff Henley, the chairman of Oracle, in person since we shared a podium during the dot-com heyday. The event was an in-house conference, and I was to present my view of the world as an industry analyst in a Q&A session with Henley, then CFO,as the moderator. The other panelist was forced at the last minute to bring up his side – the financial analyst point of view – from the inconvenience of a video link. It turned out that Oracle was in a quiet period, and no financial analyst could be allowed to be on site at a meeting of a company he covered.
The other guy was someone from Morgan Stanley named Chuck Philips – also known as Charles Philips, one of two co-presidents of the company Henley is now chairman of. (Feel free, by the way, to opine on the irony of the moment and the relative success of my fellow panelist. Sometimes life is just like that, you know.)
Sitting down with Oracle Chairman Jeff Henley in 2006, it's apparentthat heisn’t much different than Jeff Henley in 2000, but his company certainly is. Here’s some highlights of our talk:
The Linux Non-acquisition. In reference to speculation that Oracle would buy a Linux company, Jeff reiterated the “never say never” answer that has been the Oracle mantra since they did the impossible and acquired PeopleSoft. But Henley did clarify a point that had tilted me away from the speculation that Oracle would acquire Red Hat or some other Linux distributor: Such a deal would contribute little to the bottom line at Oracle. It might add some customer value to a “stack” deal, but Henley agreed thatan investment in an applications company, like the Metasolv deal announced this week, might have a better net effect than buying a Linux company.
The War of the Ecosystems. The buzz around SAP’s ecosystem doesn’t really concern Henley, who believes that customer value, not buzz, should be what drives partnership deals. I think they may need to rethink that perception, but it’s hard to argue that position from an Open World that claims to have 17,000 partners in attendance. Quantity always looks better than quality, but I think the market has proven time and time again the big isn’t necessarily better when it comes to partner ecosystems.
Oracle’s Hidden On-demand Success. It was Jeff Henley who “encouraged” Oracle’s salesforce five years ago to add an on demand price option to every proposal they put in front of a customer. The strategy was eventually killed, but it helped make Oracle’s On Demand offering a legitimate player at a time when only Salesforce.com was really staying the course. Heard much buzz about an On Demand offering from Oracle that Henley says is growing at 70 percent? Me neither. But we will, for sure: 2007 is the year that SAP and Microsoft start making a lot of noise about software as a service, and with the market heating up for a major CRM blow-out between Oracle, SAP, and Salesforce.com, Oracle will need to re-gen some buzz over this forgotten asset.
The Art of Succession. Finally, if you work for Larry Ellison, you don’t plan for a worse-case scenario future. Oracle is definitely “grooming” successors, Henley acknowledged, but Larry apparently subscribes to the “immortal until proven otherwise” school of thought (my own personal favorite) and therefore no contingency for succession is actually necessary.
Until proven otherwise.....