Rimini Street, a growing third party maintenance provider, said that its new sales bookings for Oracle applications are surging.
Rimini, which is being sued by Oracle, provides support for SAP and Oracle software, including Siebel, PeopleSoft, JD Edwards, E-Business Suite and Oracle Database.
Specifically, Rimini said it has new sales bookings of $217 million in the last year. Oracle new sales bookings in the past six months are larger than the last two years combined.
As Oracle launches its Fusion applications, Rimini could do well as some customers decide to stick with their existing legacy applications as they evaluate other options. Rimini's model revolves around undercutting Oracle and SAP on maintenance revenue.
Rimini recently said its first quarter revenue was $10 million and the company’s deferred revenue, sales bookings and backlog were at all-time highs. Rimini said it had sales bookings of $63 million in the first quarter.
The company has 475 clients and operates in 70 countries.
Analysts are closely watching Rimini as well as its defense against Oracle. Deutsche Bank analyst Tom Ernst Jr. said:
We believe that at current size ($40m annual run rate), Rimini Street's impact on Oracle's maintenance revenue is immaterial. However, the long-term impact could be a much more pronounced maintenance pricing pressure. Since Rimini Street offers support for Oracle's applications at 50% off, it is a compelling option for customers with products that are stable and more than a couple of years old. In addition, with Fusion Apps being a full replatforming, customers could be considering other vendor options (either SaaS or SAP) or going off maintenance with their existing apps to third party support providers, like Rimini.
Ernst said that the Oracle lawsuit is an overhang for Rimini and handicapped the following possibilities:
- Oracle wins against Rimini and shuts down third party maintenance operations.
- Oracle settles with Rimini and contains the third party maintenance market.
- Oracle loses its case and Rimini growth accelerates and allows an entire third party maintenance industry to emerge.
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