The Worst

By John Pallatto  |  Posted 2003-12-30 Print this article Print

The Worst But PeopleSoft found it had to carry out this acquisition with the barbarians pounding at the gate. As 2003 closes, the company is still trying to fend off the hostile takeover bid of Oracle, which wants to strengthen its enterprise application product line with components from the combined PeopleSoft and J.D. Edwards.
Oracle and its Chairman Larry Ellison also figured in a couple of the worst developments of 2003. PeopleSofts decision to rebuff the hostile buyout and follow through with the J.D. Edwards acquisition failed to cool Oracles ardor. The Redwood City, Calif., database giant is pursuing a proxy fight to try to force a buyout of the PeopleSoft/JDE combination. The current PeopleSoft senior management could very well prevail in the proxy fight to remain an independent company. But the battle has complicated the companys efforts to integrate the JDE people and technology into a seamless organization. Earlier this year Ellison displayed his own view on the prospects for future growth in Silicon Valley when he suggested to the Wall Street Journal that that it wouldnt be bad for business if another 1,000 northern California technology companies went bankrupt and disappeared from the face of the earth. He meant that it wouldnt be bad for Oracles business if another 1,000 companies disappeared. Casualties among high-tech and Internet companies have been appalling over the past three years. There is no question that the attrition is going to continue for some time to come as companies merge or shutter their doors because of the relentless forces of economics. Sadly for Ellison and Oracle, some of those companies will survive the turmoil and one or two of them might actually grow to the point where they will become troublesome competitors for Oracle. Thats another effect of those inexorable forces of economics. Another low point emerged when IBM disclosed this month that it plans to move as many as 4,700 skilled software production jobs from the United States to China, India and other nations where costs are lower. IBM says the move is essential to help the company remain competitive, and it notes that a majority of its workforce is already based overseas. Thats little comfort to experienced American software engineers who worked years to acquire skills they thought would keep them employed for a lifetime. The standard argument is that such educated and skilled people will have no trouble shifting to even more rewarding work. But this argument doesnt ring true to people who have spent months trying to subsist on unemployment compensation and savings. Many have had to move into stopgap jobs that are far below their training and experience while they hope that the technology sector improves enough to bring their skills back into demand.

John Pallatto John Pallatto is's Managing Editor News/West Coast. He directs eWEEK's news coverage in Silicon Valley and throughout the West Coast region. He has more than 35 years of experience as a professional journalist, which began as a report with the Hartford Courant daily newspaper in Connecticut. He was also a member of the founding staff of PC Week in March 1984. Pallatto was PC Week's West Coast bureau chief, a senior editor at Ziff Davis' Internet Computing magazine and the West Coast bureau chief at Internet World magazine.

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