Has Oracle lost its Graveyard magic?

Whew.  Brad Peters, a former Siebel exec, lays into the much-discussed Oracle quarterly miss:

Oracle thought it could have it both ways – that is, capture this new SaaS (software as a service) world without having to abandon its aging and hugely successful business of selling expensive servers. And at the heart of this strategy was Oracle’s long-standing practice of upgrading its customer offerings by buying up fast-growing small enterprise software companies and adding their high-profile products to Oracle’s catalog.

This technique has worked brilliantly for many years, despite the fact that Oracle, once it bought these hot companies, typically lost all of their talent and rarely integrated or upgraded their products. The key was taking these new products and leveraging a sales army to get them into the hands of many more customers. ...

Whatever the cause, the reality as those numbers suggest, is that those recent acquisitions should have resulted in a direct improvement in both Oracle’s revenues and profits. Instead they seemed to have subtracted from them. In essence, 1+1 is supposed to equal 2; right now at Oracle it equals .99. That suggests that Oracle’s legendary genius for absorbing acquisitions is starting to break down, or maybe they need a new playbook for cloud. The company’s traditional infrastructure of sales, marketing and legal may no longer be empowering these new arrivals, but rather acting as antibodies trying to destroy or expel incompatible intruders. That’s a recipe for disaster.

Of course, Brad is now the CEO of ... you guessed it, a cloud company, Birst, which delivers analytics in a SaaS model.  So activate the same filter you use when you see me inveighing against proprietary closed-source software, or Matt Asay making similar points as Brad and finding opportunities for MongoDB ;-)

Regardless of where one sits, though, the magnitude of the Oracle miss is pretty striking.  Is it really as much of a harbinger as Brad and others have written?  Or will Larry take the appropriate people out behind the barn, and fix the problem?  I'm inclined to agree with the general principle that old-school enterprise software vendors are having their business models challenged from multiple fronts.  Oracle, so far, has been among the more successful at holding off the barbarians at the gates.  But maybe the gates of Mordor are more easily breached than we thought...

Dang, there I go mixing sci-fi/fantasy metaphors again.  Are they the Death Star?  Or Mordoracle?

Sage - Carrion Relationship Management

(Carving off Rotten Meat?)

(Couldn't Rationalize Marketing?)

Ah, the fun we can have with the news that Sage Group is selling off certain of its older CRM acquisitions, notably ACT! and SalesLogix (no exclamation point) to a former Sage development partner called Swiftpage.

Swiftpage, which does "white label marketing services," is financing the acquisition with a slug of capital from - you guessed it - a private equity firm, Accel-KKR.

All kidding aside, the press release doesn't say how much capital - but the 451 Group is reporting "250 employees are expected to join Swiftpage."  That's a lotta headcount.  Good on 'em, I guess.

UPDATE: Leonard Klie at Destination CRM puts the pricetag for these two, plus a CRM suite for nonprofits, at $101.2 million.  Four additional "non-core" products are also getting the heave-ho across the pond:  "In Europe, Sage will sell its C&I, ATL, Automotive, and Aytos product lines to Argos Soditic, a private equity firm based in Paris, for roughly $44 million."

The Destination CRM piece also includes quotes from Sage execs about how they're focusing on their core CRM product, just not these CRM products.  Makes you wonder about the long-term viability of the rollup model, doesn't it?  Will Infor, Epicor, or Aptean follow suit?

Fused to the Graveyard

Antone Gonsalves over at Readwrite has a good writeup of a new Forrester report on Oracle.  Apparently, its acquired customers from JD Edwards, Peoplesoft, Siebel, etc., aren't lining up to spend more money and take more risk on upgrading to the new Fusion Apps:

Forrester's numbers are sobering. The survey of Oracle clients found 65% had no plans to move to Fusion Applications and another 24% were on the fence.

Dang, an 11% success rate.  Well, at least the customers are happy with the value they're getting from their beloved vendor.  Oh, wait:

Making matters worse, Oracle is in danger of losing business from some of its customers. Forrester found 29% of the companies it polled were planning to move to another vendor's SaaS product or packaged application. The main reasons for their unhappiness with Oracle were high licensing costs, high maintenance costs and difficulty in upgrading.

What to do, if you're Oracle?  Keep buying.

ERP rollups <> innovation

Brian Sommer has a really thought-provoking piece over at Enterprise Irregulars today.  You might not agree with all of his conclusions, but he goes into the technological and cultural changes sweeping through ERP and IT generally, and makes a number of really good points.  Here's one that I found particularly relevant to Graveyard readers:

Some ERP vendors are financially motivated firms that are designed to delight their shareholders. Some are innovative firms that are motivated to delight customers.The difference is telling. 

Right on.  We're doing some pretty darn interesting stuff over at xTuple, giving our customers a path to true mobile/web/cloud.  Stay tuned.

Um, Infor did not launch an "open source strategy"

So the headline over Chris Kanaracus' otherwise accurate piece in IDG proclaims "Infor launches open-source strategy."  Various other news services, linking to that and other articles, offer variations on the theme:  "Infor goes open source!"  "Infor open source plan!"

A moment, please, to catch our breath.  All they are doing is certifying another infrastructure platform.  As the Infor release notes, " Infor ION and Infor LN are now certified on Red Hat Enterprise Linux operating platform and JBoss Enterprise Middleware solutions."  OK, great - so presumably the former Baan application, and the Java-based middleware (presumably rewritten from the Microsoft-outsourced plan of two years ago) now run on something that's pretty darn similar to the Unix and other Java middleware they used before.  Knock me over with a feather.

Then there's this:  "Additionally, both Infor LN and ION can now leverage MySQL and MariaDB" (a fork of MySQL that took off after Oracle acquired Sun, which acquired MySQL).  Does that mean the whole application can run on MySQL instead of Oracle or DB2?  If so, that would be marginally more impressive.  Or are they just being cute - you can "leverage" it by building your own tools and middleware?  Can anyone comment authoritatively on this?

Still, though, let's keep our shirts on.  They're not making any of their own code open source, as far as I know.  They're not embracing anything at all open source on the application level, because of course, that's where they make their money - and exercise power over their hapless acquired sheep customers.  As analyst Frank Scavo pointed out in the IDG article, "enterprise vendors always want to commoditize the thing in the technology stack that they don't provide. If you're an Oracle you're never going to commoditize the database. But Infor doesn't provide those [infrastructure] pieces."

In a very real sense, this is perhaps the long-awaited declaration of hot war from Chuck Phillips against his former boss Larry Ellison.

Closing plug:  If you're looking for an ERP vendor with a true "open source strategy," you might try one that has award-winning functionality, comparable to any midmarket ERP system past or present, that is available free of charge, with source code, has been downloaded over 1,000,000 times, and has been translated and localized into dozens of languages and markets by a truly global open source community.  Visit the company site at xTuple.com, or the community site at xTuple.org.