SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

Summary: Oracle is expected to roll out its Fusion apps early in 2011 and SAP sees an opportunity to poach a few customers as IT buyers pit the two companies against each other for leverage.

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TOPICS: SAP, Banking, CXO, Oracle
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Oracle and SAP will be duking it out in court next week over the TomorrowNow lawsuit, but the real fireworks for IT buyers will come next year.

Why? Oracle is expected to roll out its Fusion apps early in 2011. As previously noted, Oracle is expecting half of its customer base to upgrade to Fusion applications within 5 years.

The big question is whether Oracle customers---notably all of those folks on Siebel, PeopleSoft and JD Edwards---will use the Fusion product cycle to go shopping for alternatives.

That's where SAP comes in. On Wednesday's third quarter conference call, SAP CEO Bill McDermott welcomed Oracle's Fusion product cycle. That positioning could be dismissed as bravado, but here's how the enterprise resource planning buying cycle plays out:

  • You eye an upgrade from Oracle or SAP;
  • You evaluate both;
  • And you extract concessions from one of the two vendors as you make a choice.

McDermott knows this game well. He realizes that every Fusion upgrade may be an opportunity to pry away an Oracle customer. McDermott said:

First of all, in relation to the competitor bringing in a new product to market, considering it is several years late now, it still remains to be seen if it won't yet be another year late. So let's see if they are continuing to be late.

The fact of the matter is they don't do very well in generation one releases, which is why I think they have watered down the messaging to basically sort of beta'ering and testing with some customers on "their new product".

We look forward to the day that they may have some kind of a new product or a new release level, because that will then put all those customers in their existing installed base of all the rollouts that they have done on the M&A front in a buying mode.

They will have to make a decision. They will have to make a decision to keep the legacy and the maintenance on that or they will have to make a decision to switch. If they consider switching to a new platform or a new application from Oracle, you and I and everyone else on this call know that they're going to shop it against SAP, if for no other reason than just to keep Oracle honest on price. Which means we come to the table in a buying decision with a customer.

In other words, the IT buyer can play SAP and Oracle off each other for a few years to come.

Related: SAP's McDermott to Oracle's Ellison: bring it on

Topics: SAP, Banking, CXO, Oracle

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  • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

    Yes this is right that Oracle is expected to roll out its Fusion apps early in 2011 and SAP sees an opportunity to poach a few customers as IT buyers pit the two companies against each other for leverage.
    raimu koyo asu
    • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

      Oracle has filed a motion (PDF download) opposing H-P?s request to seal records. It starts:<br><br>?This case is an abuse of the judicial process?a publicity stunt in a broader campaign to lay the blame on Oracle for the disruption that will occur when HP?s Itanium-based server business inevitably comes to an<a href="http://argyletv.info/"><font color="light&amp;height"> about it</font></a> is bank that <a href="http://readbetweenthevines.com/"><font color="light&amp;height">website</font></a> attacked from the <a href="http://paul-hurley.info/"><font color="light&amp;height">site support</font></a> from any soldier <a href="http://www.inusevconsulting.info/"><font color="light&amp;height">site</font></a> to the light <a href="http://www.immeublestpierre.com/"><font color="light&amp;height">home page</font></a> is great end.
      Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        HP untenably has put itself and thousands of customers out on the end of a very long limb because HP, almost alone now, clings to a decades-old
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        microprocessor architecture?Intel?s Itanium chip line?that has no future. Intel has wanted to
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        discontinue Itanium production for years, and HP knows it. The performance advantage over Intel?s
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        x86-based microprocessors that once justified Itanium is today effectively gone. But the end of
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        Itanium is a business disaster for HP, which generates a large percentage of its overall profit from
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        Itanium support agreements. So rather than telling its customers the truth about Intel?s plans for
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        phasing out the Itanium platform, and helping those customers transition to Intel Xeon systems
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        other alternatives, HP perpetuates the myth that there is a long 10-year roadmap for Itanium
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        Thus starts the latest motion in the ongoing feud between Oracle and H-P over Oracle dropping
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        development for the Itanium processor. It gets better (or worse depending on who you are
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        Now HP is suing Oracle for the temerity to tell customers the truth? and ?It has engaged in a
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        massive campaign to vilify Oracle for this announcement, planting anti-Oracle stories in the press
        Linux Love
      • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

        I have seen some of those ?planted? stories and felt that H-P was treading a dangerous path given the tenacity of Oracle?s legal department at sniffing out anything with a whiff of BS.
        Linux Love
    • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

      @raimu koyo asu I see the pricing has been release, bot can't find anyplace that mentioned how much storage is included. While the licensing costs are very reasonable, I wonder if there are any surprise costs. i.e. how much storage is included in the 25 user plan and how much does it cost for extra storage?
      Arabalar
  • RE: SAP's McDermott: Oracle Fusion upgrade could mean it's poaching time

    development
    Linux Love