Oracle is hoping to boost sagging software revenues with a messaging product that will go head to head with Microsoft Exchange and Lotus Notes.

Oracle Collaboration Suite is an alternative back-end for Microsoft Outlook and is based on the Oracle 9i database and application server, Internet

File System and group calendar software from Steltor, a company Oracle bought this past summer.

But if Oracle thinks it’s going to grab market share in a hurry, it has its work cut out for it – at least in the Canadian market, said Warren Shiau, software analyst with IDC Canada.

“”In general, the collaboration software market is a mature market; most companies bought their infrastructure a while ago,”” said Shaiu. “”Right now, users don’t identify this as an area where they’re going to gain competitive advantage.””

In 2001, the corporate messaging and collaboration market reached about $45 million in Canada, with Microsoft and Lotus splitting about 86 per cent of the market.

Collaboration Suite manages e-mail, voice mail, calendar and faxes from within its database. Companies can retain their Microsoft Outlook E-mail client software and gain the advantages of storing e-mail messages in an SQL-based database, said Barnaby Jeans, Oracle Canada’s national solutions leader of mobile and wireless technology.

“”The Oracle solution provides a huge value proposition around total cost of ownership, lower cost of management and those types of things,”” said Jeans. “”As customers start to look at that, they’re going to realize there’s a good reason to make that change.””

Oracle is hoping to cash in on Microsoft customers considering an upgrade from Exchange 5.5. According to San Francisco-based industry analyst Ferris Research, the typical cost for customers to migrate from Exchange 5.5 to Exchange 2000 is US$100 per mailbox for corporations larger than 1,000 seats.

Oracle consulting is offering migration assistance from Exchange 5.5 to Oracle Collaboration Suite for about US$30 per user.

Shiau said there’s an opportunity for Oracle to get some Microsoft converts because IT shops that are still on older versions of Windows are moving to a different architecture.

“”Every time you do that, you essentially do a re-implementation and there’s an opportunity for another vendor to come in,”” he said.

However, Oracle will be making a mistake if it chooses to market Collaboration Suite strictly on the basis of its return-on-investment proposition, said Shaiu.

“”I’m not so sure if ROI is the most marketable aspect of the offering,”” said Shiau. “”Having an integrated stack from Oracle is more likely the biggest marketplace selling point. From a cost standpoint, it’s more cost-effective to centralize the management of software. It’s also cost-effective to integrate your software.””

That proposition sounds appealing to Mark Sylvester, director of Oracle applications solutions at Montage-DMC, an Ottawa-based systems integrator. He said having an end-to-end stack from one vendor will help keep costs down.

“”Both from an implementation perspective and usage perspective, the single biggest repeating cost of ownership is trying to integrate (disparate) products,”” said Sylvester.

Companies that have invested heavily with one software partner will have strong in-house expertise of that vendor’s offerings, added Sylvester, so it would be a natural choice to adopt additional software packages, such as a messaging suite.

Oracle Collaboration Suite version 1 began shipping in September. The price for a perpetual license is $60 per named user.

The Oracle Collaboration Suite runs on Solaris, Linux, and HP-UX; versions for Tru64 Unix, AIX, and Windows are in the works.

Oracle also plans to release improved performance diagnostics and IT asset-tracking tools, called Oracle Enterprise Manager, by March, the company announced. The tools will allow IT managers to assess database performance.

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