Database Maker's co-president on PeopleSoft, app integration.
Within weeks of joining Oracle Corp. last spring, Charles Phillips began to play a prominent role in Oracles hostile takeover bid for enterprise applications developer PeopleSoft Inc. Having come from more than a decade as an IT industry financial analyst on Wall Street, that was not terribly surprising. Observers did take note, however, when Oracle founder and CEO Larry Ellison named Phillips and Safra Catz co-presidents of the database and business applications company. Phillips recently sat down with eWEEK Department Editor John S. McCright and Senior Writer Brian Fonseca to discuss the PeopleSoft deal and IT issues at Oracle headquarters in Redwood Shores, Calif. The following is an excerpt; for the full interview go to eWEEK.com.
What kind of reception have you been getting from PeopleSoft shareholders?
We continue to try and invite the PeopleSoft management team and board to meet with us. They have refused to do so, despite the fact that our newly revised offer is at a substantial premium to where the stock is. We have heard back from plenty of stockholders that they would love to have access to the $26 in cash.
I guess PeopleSoft said six months ago, "No price, no structure, no way." And I guess they meant it. They havent, we think, responded at all or even considered it.
So, given that, the next milestone is waiting for the Department of Justice [to make its official recommendation next month]. But we think we put forth a strong case that this is pro-competitive. Huge competitors like Microsoft [Corp.] and SAP [AG] are investing and buying companies in this market [and customers are] offshoring and outsourcing. [In that context,] this [merger of Oracle and PeopleSoft] creates a competitive critical mass against these other companies. We still remain confident that the DOJ will come to the same conclusion.
Even if the PeopleSoft acquisition doesnt work out, youve got a lot of
money burning a hole in your pocket.
Well, theres nothing wrong with cash. Its served us well in the past. PeopleSoft was one decision, one opportunity. Its independent of any other ones.
You have a lot of experience in finance and IT. What do you bring to the
company as far as running operations, running sales and directing development
Im not running development, and I think its a team approach here, so Im not really looking at it as involving these big decisions that one persons making. Its a combination of myself, Safra and Larry and other people as well. ... Most things here are a team approach and that means multiple people look at it with different perspectives. Its useful, so I feel like Im adding to an already strong team.
At Oracle AppsWorld last month, you talked about the Customer Hub and application
integration in general. Are Oracles integration efforts a recognition that
you need to reach out to others?
Well, theres different reasons for it. You can also look at integration as a way for people to evolve into the Oracle E-Business Suite. So to give [customers] a way to start with a few modules and slowly add new modules over time, have them start with an easier on rampthats a big part of this. Integration helps new customers, [and it helps] existing customers migrate into this suite over time. Then when it comes to our Customer Hub, this is yet another alternative for those companies that dont buy the suite at all or have a lot of legacy applications [they] cant really migrate away from. They still want some of the benefits of a single data model, one thats been tested in the market. Thats yet another set of customers we can now reach that we couldnt talk to before.
Is the new pricing of the Oracle Standard Edition One database an admission
by Oracle that it has to lower prices to become more competitive?
You always want to do that, but you have to have a product to do it, so whats different now with these latest releases [is] the product reflects the ease-of-use attributes that people wanted on certain parts of the market. We always had a lot of power and scale; what was missing was the ability to appeal to customers who value ease of use more and automation, administration and things like that. So we basically did an assessment of the product, had some consultants look at it for the last couple of years, [and they] came back and pointed out hundreds of areas of the product that were manual that didnt have to be. We took that list and automated those tasks. So even for people who dont care about grid, theres a lot in [Oracle 10g] for ease of use, productivity, automation, even for large customers. Its a big leap for us.