Oracle moves to shore up PeopleSoft channel

REDWOOD CITY, Calif. — Oracle Corp. hopes the bulk of PeopleSoft Canada’s staff, including former president Andy Aicklen, signs up with the new owner.

Aicklen has been offered the job of heading Oracle Canada’s government sales business, according to Keith Block, executive vice-president of

North American field programs.

Workforce reduction will happen over time and according to Canadian laws and regulations, said an Oracle Canada spokesperson.

The spokesperson went on to say that Oracle will be retaining more than 90 per cent of PeopleSoft’s development and support organization.

“I believe he’s going to come on board,” Block said in an interview here Tuesday, one of a series of meetings Oracle executives had here to convince IT media, industry analysts that its US$10 billion acquisition of PeopleSoft will benefit VARs and customers.

The company is going out of its way to assure PeopleSoft resellers (including J.D. Edwards partners PeopleSoft picked up 18 months ago) that they will do almost anything to keep them and their customers.

They’re doing that in many ways: Oracle CEO Larry Ellison has promised that PeopleSoft/JDE maintenance and support contracts won’t be changed, support and upgrades for most PeopleSoft and JDE applications will be extended to 2013 (including those running on competing databases), and there will be a “graceful upgrade” from those apps to a new enterprise resource management suite dubbed Project Fusion using the best parts of Oracle, PeopleSoft and JDE in 2008.

“Our number one objective is to retain PeopleSoft partners (and) to be sure they have no interruptions – business as usual,” said Rauline Ochs, group vice-president for North American channels and alliances.

“By the end of this month we’re going to start working with them so they’re completely aligned with our sales force,” she added.

While the strategy is to encourage PeopleSoft/JDE VARs to keep selling upgrades to existing customers, Oracle also said that new customers looking for business applications will be encouraged to buy its E-Business Suite (EBS), or its lower-market sibling, the EBS Special Edition.

Many PeopleSoft partners say they want to add the Special Edition to their product portfolio, Ochs added. “That product is available to partners as quickly as they can get through the qualification criteria,” she said.

In fact, she added, next month the company will stage a Webcast to tout the Special Edition to Canadian resellers and potential customers.

Another way Oracle is trying to be channel-friendly is by raising the limits over which its internal sales force can sell. PeopleSoft restricted its partners from dealing with companies with sales of more than US$100 million; Oracle’s limit is US$75 million.

That line will be lifted in June to US$100,000 for both partners, Block said, and could be raised further as the number of partners, and their coverage, expands.

While Oracle has made some promises to partners and customers since December, when it announced PeopleSoft had capitulated to its hostile takeover offer after 18 months of struggling, customers and partners have been aching for more details.

Industry analysts gave yesterday’s performances mixed scores.

“The product and support roadmaps were exactly for a skittish PeopleSoft customer,” said Scott Tiazkun of IDC. “They had to reassure customers. I think they did that and then some.” The promise of support for PeopleSoft/JDE products to 2013 was overkill, he said.

On the other hand, he wanted to hear more about product plans for vertical industries.

“Whether Oracle can continue to cut into SAP’s share will depend entirely on the successful integration of the two companies,” observed Bruce Richardson, senior vice-president of research at AMR Research.

He also questioned the 2008 target date for the newly merged suite promised by Ellison.

As usual, however, the CEO was confident. He promised the company will have a two-pronged strategy: Continue to develop J.D. Edwards World 8.11 to version 8.12, finish developing PeopleSoft Enterprise 8.9 and complete version 9.0 and develop a new release of Oracle EBS; and build Project Fusion.

“We can both,” he maintained. “We have the wherewithal to develop all three lines while developing a successor merged product.”

“We’ll have a graceful upgrade to Project Fusion at some point in the future,” he promised.

Nor will there be any pressure from Oracle on customers migrate to the new suite. “You pick the time when it’s convenient to upgrade,” he said.

The switch will be “an automated upgrade” from any current PeopleSoft and JDE product that will carry over all their data, he said, “not a conversion” to a new application.

He also dismissed concerns that Oracle will pressure PeopleSoft and JDE customers to move from other companies’ databases to Oracle. While Oracle will welcome companies switching, “we’re not going to nudge you to do that.” Support for IBM, BEA and Microsoft products on PeopleSoft and JDE platforms will continue until 2013, he Specifically, PeopleSoft and JDE upgrades set for this year will continue as scheduled. In 2006 PeopleSoft 9.0, JDE Enterprise One 8.12 and Oracle EBS 12 will be released.

Support for JDE XE and 8.0 will be extended until February 2007.

Among the details yet to be worked out is whether customers will have to buy the latest PeopleSoft/JDE versions to qualify for an upgrade to Fusion.

Customers running those apps on other platforms will also have to undergo somewhat of a learning curve and training adjustment: Fusion will be based on an Oracle database.

The first elements of Fusion technology will be made available in 2006 in data hubs and transaction bases, with individual applications out the following year. The full Fusion suite is expected to be released in 2008.

Fusion will  be a Java-based product which will take advantage of Internet technologies, Ellison said, a leap over industry-leader SAP which is developed on proprietary tools.

One industry analyst was impressed that John Wookey, Oracle’s senior vice-president of applications development, now has full responsibility over that area.

Paul Hamerman of Forrester Research said it’s a sign the company is serious about boosting the importance of its applications work to at least the level of its database.

“Applications have been a sideline for Oracle,” he said, noting that historically they have accounted for only 20 per cent of the company’s business. But having spent US$10 billion on PeopleSoft shareholders will be expecting some return.

Wookey’s promotion “will be key for Oracle to step forward in applications,” said Hamerman.

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Howard Solomon
Howard Solomon
Currently a freelance writer. Former editor of and Computing Canada. An IT journalist since 1997, Howard has written for several of ITWC's sister publications, including Before arriving at ITWC he served as a staff reporter at the Calgary Herald and the Brampton (Ont.) Daily Times.

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