Victorious Oracle's pledge on PeopleSoft

Oracle's £5.5bn takeover of rival ERP supplier PeopleSoft at the end of last year will affect the future IT strategy of thousands...

Oracle's £5.5bn takeover of rival ERP supplier PeopleSoft at the end of last year will affect the future IT strategy of thousands of PeopleSoft and former JD Edwards users across the UK.

Oracle chief executive Larry Ellison made plain his commitment to PeopleSoft and JD Edwards users when the takeover was announced, but analysts are warning users to monitor developments closely.

"We intend to enhance PeopleSoft 8 and develop a PeopleSoft 9 and enhance JD Edwards 5 and develop a JD Edwards 6. We intend to immediately extend and improve support for existing JD Edwards and PeopleSoft customers worldwide," Ellison said.

AMR analysts Jim Shepherd and Bill Swanton said Oracle was buying PeopleSoft for its customer base. "It is interested in keeping those customers happy. Those PeopleSoft customers that reach out to Oracle, build a relationship and agree to act as references will undoubtedly get attention, and they may receive some considerations concerning contract terms or pricing," the analysts said.

The analysts expect the widely used PeopleSoft HR system to be supported and enhanced for at least 10 years. However, users may not be able to purchase licensing under the same terms and conditions that applied to an independent PeopleSoft.

"We believe that in future Oracle will try to simplify and rationalise the licensing and mainten- ance schemes. We do not expect Oracle to try to force existing PeopleSoft customers to re-license, but it may not continue to offer revenue-based pricing on subsequent purchases," said Shepherd and Swanton.

Analyst firm Gartner has raised concerns that despite Oracle's pledge to support and develop the PeopleSoft product family, there may be fundamental changes in strategy under the new owner.

In September, PeopleSoft announced it would be working with IBM to jointly develop software packages aimed at customers in financial services, telecommunication and insurance based on IBM's Websphere middleware platform. However, this is unlikely to go ahead, according to Gartner analyst Jeff Comport.

Gartner also urged former JD Edwards users considering an upgrade not to commit to any large projects until Oracle reveals its long-term strategy for the PeopleSoft Enterpriseone product line.

Many questions remain and the finer details of the buy-out are unlikely to be made available to users until after it has completed.

What is apparent is that the UK Oracle User Group (UKOUG) is keen to get involved. Chairman Ronan Miles said, "The UKOUG is lucky in that one of its special interest group chairs is also significant in the PeopleSoft user community.

"We will be meeting with some of their representatives in early February to start the discussion on how the user communities in the UK should react to the Oracle acquisition."

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