Weighing In on Oracle

By Dennis Callaghan  |  Posted 2004-11-08 Print this article Print

So with that in mind, do you care to weigh in on Oracles takeover attempt of PeopleSoft?

First of all, I think PeopleSoft was absolutely stupid not taking the $27-per-share offer. That was unbelievable, that offer. Theyve lost a lot of business because of the FUD [fear, uncertainty and doubt] factor. Very few people are willing to install PeopleSoft right now because of the FUD stuff. I personally thought when [Oracle CEO] Larry [Ellison] first made his offer, he was just messing with these people, just to mess up their quarter. But then it dragged on and on, and its messed them up now for over a year. Larrys stated idea was to discontinue the software, just put maintenance on it. That doesnt make people feel good about the software.

But SAS must have a lot of common customers with PeopleSoft. If PeopleSoft became part of Oracle, wouldnt those customers have to consider Oracle technologies instead of SAS?

These are operational systems. Just about everything Oracle does and everything PeopleSoft does are operational systems that are mainly concerned about updating records and updating files, making payroll happen and all that kind of stuff. Were in a much deeper, heavier analytical space.

But if you compete against Oracle in a lot of areas, wouldnt that mean some of these PeopleSoft customers would be more likely to consider Oracle in those areas, rather than SAS?

First of all, if they do the acquisition, itll mess Oracle up for a year, which I dont mind. What we compete against Oracle with is primarily data warehousing. They believe that since they can store data in a database, it automatically makes them a data warehouse vendor. Without the analytical and reporting tools to go with it, thats only half the solution. We provide both the storage ourselves and the analytical capability.

Does a hostile takeover like this and rumors of more acquisitions to come give you more confidence in your decision to keep SAS private?

Absolutely. Not so much the acquisitions but the fact that by being private, we dont have to worry about making our numbers every quarter. Were not quarterly focused; were focused on the next two years. So we have a rolling two-year cycle that were looking at that were more concerned with. I feel sorry for people that have to be concerned about making their numbers every quarter or the analysts are going to say bad things about them. Thats a shame. I wish the SEC wouldnt require quarterly [earnings reports]. They ought to go to every six months or something. They really ought to go to yearly reports instead of quarterly. So its safe to say then that SAS isnt going to go public anytime soon?

Not anytime soon. Whats the biggest challenge for SAS going forward?

The challenge is to probably continue to be able to stimulate the workplace, to make sure that we dont get lethargic. That we always keep focused on what our customer needs are and where the markets going. That we try to keep keenly focused on that area and not get distracted with other things. Of course, thats always the challenge for any company to do that. Were here at this conference because SAS bought a company [ABC Technologies]? Are there any more acquisitions in the future for SAS?

There is nothing at all on our horizon. We did three last year and were still trying to finish off the stuff we did there. We bought MarketMax—we went to a lot of retailers and took a look at what we had and what MarketMax had and said, OK, what else do you need? And they helped us build sort of a roadmap, things like demand planning, pricing optimization, things like that. So what were trying to do right now is fill in those holes that exist between the two products. From our OpRisk stuff, were still trying to finish that up. Weve got a number of banks in Europe that have partnered with us and were working very closely with them to make sure that we have all the requirements that they need.

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