The Quiet Giant

By Renee Boucher Ferguson  |  Posted 2006-11-27 Print this article Print

Snead, however, has no intentions of moving his entire back-end environment to an on-demand model. Rather, the goal is to move adjunct pieces of software to provide more agility. Thats the tack "old model" companies such as Oracle, SAP and Microsoft are banking on—that customers will maintain their (expensive) on-premises ERP implementations and "add on" on-demand functionality.
While the "big three" ERP vendors are making stabs at on-demand offerings—SAP with its hybrid CRM, Microsoft with its Live initiatives and Oracle with Oracle On Demand—Oracle is far and away the sleeping giant in this crowd.
On the heels of Salesforce.coms announcement of its $500,000 revenue mark in November, Oracle released a statement that it has surpassed a milestone of more than 1.7 million on-demand users, representing more than 2,200 customers buying Oracles subscription-based solutions, managed applications or software managed services (compared with Salesforce.coms 27,100 customers and 556,000 users). But even beyond its January 2006 acquisition of Siebel, Oracle was in the on-demand game. During the dot-com bust in the early part of the century, while others were fleeing the ASP (application service provider) model, Oracle hung in there, offering its E-Business Suite software as a service. With the acquisitions of PeopleSoft and by default JD Edwards, Oracle expanded its portfolio of applications and technology available on demand. And now the company is pumping a lot more resources into its on-demand offering, according to Rottler. "Youll see us ramp up quite a bit—more advertising, more marketing, more sales," he said. "Weve incorporated Siebel CRM OnDemand and [developed] three new releases. Weve rearchitected our entire underlying architecture to scale the business a lot faster. Weve made core investments … that require a pretty heavy investment in R&D and services that a lot of niche players cant really make." In addition to infrastructure investments in data centers (Oracle expects to partner a lot on this front), Linux and grid computing, Oracle plans to spend on new features at the application level—the company is developing Fusion CRM, based on Siebels technology. In the meantime it expects to announce in the next several weeks the next version of CRM On Demand that integrates Siebels technology with the Oracle E-Business Suite and JD Edwards suite. Where Oracle differs from other on-demand players is in its definition of software as a service. Its not about multitenant software—the practice of putting each companys software installation on a shared architecture—or subscription licensing where users pay for software on a monthly basis. Its about whether or not Oracle takes the responsibility for hosting and upgrading a users software, according to Rottler. "Its when we take operational ownership of our customers applications and there are service levels against that," he said. "So we host, run [and] evolve the applications, and were a partner. Were still in charge." Check out eWEEK.coms for the latest news, reviews and analysis about productivity and business solutions.


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