Oracle Says Application Integration Efforts Are On Track

Two years is a long time to wait for major applications to be integrated. But that's what users of PeopleSoft, JD Edwards, and Siebel software face as they wait for the first fruits of Oracle's next-generation Fusion development project.

So Oracle is scrambling to keep those customers from defecting. Oracle president Charles Phillips last week said the Oracle-Siebel integration, called Project Genesis, is on track to be completed in September, and the company last week also began shipping the first components of PeopleSoft Enterprise 9, a major upgrade of the software.

Oracle is battling to retain the customers it gained in the last 18 months through a series of acquisitions. "For big software vendors, most sales will come from the installed base," Phillips said in a teleconference, estimating that Oracle's existing customers account for 85% of its application sales. SAP claims that several hundred customers of those acquired vendors have migrated to SAP products.

But Oracle says its keep-'em-happy efforts are paying off. When the company reported fourth-quarter earnings late last month, application license sales were up 83% from a year earlier, to $641 million. And Siebel's application sales were $81 million in the quarter, nearly double what the company expected.

Oracle also said 2,200 owners of SAP's aging R/3 software had signed on to a program that offers 100% license credit for SAP license fees if they migrate to Oracle applications.

Under Project Genesis, Oracle is building workflow links between Siebel and Oracle E-Business Suite applications. The effort will link Siebel Order to EBS Order, Siebel Opportunity to EBS Quote, and Siebel's CRM On Demand apps to Oracle EBS. The technology, which will be built into Oracle's Fusion middleware, also will link the Oracle Financial Services Applications analysis software with Siebel Business Analytics, Phillips said.

Lifetime Support?

Application integration efforts like Project Genesis are a logical move since all these apps will be around for a while. At the Oracle Application User Group conference in April, Phillips promised that Oracle will maintain, enhance, and support the E-Business Suite and PeopleSoft, JD Edwards, and Siebel applications indefinitely, a change from the 2013 cutoff date it originally planned. Oracle's integration plans "are definitely being well-received by our members," user group president Patricia Dues says. "It makes sense for them to do this so all these applications can easily be integrated and work with each other."

The integration work also is part of a phased approach to moving customers to Fusion once those applications are ready, Forrester Research analyst Ray Wang says. Oracle can only migrate its acquired apps to Fusion Apps when it has standardized master data, business process, and middleware semantics. "Though customers may not be asking for this today, it's necessary for the largest enterprises," he says in an e-mail.

Included in the first PeopleSoft Enterprise 9 applications Oracle is shipping is Learning Management 9.0, which focuses on certification and regulatory compliance support. Other applications, such as PeopleSoft Enterprise Performance Management, will debut in the fall, with PeopleSoft Financial and Human Capital Management due by year's end.

Users of PeopleSoft, JD Edwards, and Siebel software want an easy upgrade to Fusion. Oracle says it has heard the message. Project Genesis will be the first proof.