Workday, Oracle Move Forward With SaaS - InformationWeek

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5/1/2009
02:33 PM
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Workday, Oracle Move Forward With SaaS

In two positive signs for SaaS this week, Workday got another round of venture funding for an impressive $75 million, and Oracle is reportedly planning seven SaaS products. I have a hunch we might hear something on the latter during President Charles Phillips' keynote at the Oracle user conference next week.

In two positive signs for SaaS this week, Workday got another round of venture funding for an impressive $75 million, and Oracle is reportedly planning seven SaaS products. I have a hunch we might hear something on the latter during President Charles Phillips' keynote at the Oracle user conference next week.Workday's funding is necessary to build the infrastructure that will allow it to expand beyond its relatively controlled customer list. I've always found the company interesting; a bunch of smart people fixed on trying to convince the world that enterprise-resource planning can really be done in a SaaS model. But the company seems to not have expanded much beyond the big customers it regularly touts-Chiquita, Flextronics, Life Time Fitness-and some parts of its ERP suite are still in the developmental stage.

Indeed, the time is right for Workday to move beyond the startup stage, and it would've been very hard to do this without a big infusion of cash. The funding comes from venture firm New Enterprise Associates, which has also funded Data Domain and WebEx, plus existing investors Greylock Partners and Workday CEO and co-founder Dave Duffield.

Meanwhile, the Wall Street Journal is reporting that Oracle is planning new SaaS applications "to help business run sales campaigns, keep track of employees and job applicants, according to people briefed on the plans and a company document… ." So more in the CRM area, and also HR. Hot spots for SaaS right now. In addition, "Oracle is developing online software to handle marketing and product management as well as a product targeted at the insurance industry," according to the Journal. [UPDATED--see below.]

So maybe Larry & Charles are finally seeing promise in SaaS, but believe me, it's going to be small potatoes compared to Oracle's licensed software business. Oracle is an extremely profitable company, and owes that to software license maintenance.

I'm talking to SAP folks on Monday, and I'm curious how they're reacting to all this. I continue to wonder whether the Business By Design SaaS suite is a dead duck, despite vague reassurances by the company. I'm hearing some chatter form the customer world that BBD's approach, which does not use a multi-tenant architecture, is problematic, and the company may be considering how it can get back in on the multi-tenant side. When I find out more on this, I'll share it here.

UPDATE: My Oracle sources tell me that there is no major shift in strategy, and are puzzled by the Journal's report of "seven" SaaS products. The company already has about 9 SaaS-type offerings and will continue to offer more over time.

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