Siebel users face tough choices, warn analysts

Siebel users could face difficult choices after Oracle's £3.24bn takeover of the CRM market leader last week, analysts have warned.

Siebel users could face difficult choices after Oracle's £3.24bn takeover of the CRM market leader last week, analysts have warned.

Among their main concerns are the cost of a potential forced migration to the latest version of Siebel and whether products will remain supported by Oracle.

Paul Hammerman, vice-president of enterprise applications at Forrester Research, said, "There is going to be apprehension from Siebel customers because Oracle has been so vocal about its next-generation product strategy. Siebel customers will be concerned about when they have to migrate and the cost of migration.

"Users will have to watch out for release support schedules - companies with older releases will be forced to upgrade to current releases [such as Siebel 7.5 and beyond] and the maintenance cost structure could change."

Hammerman said Siebel users would also be concerned about whether Oracle would be able to match the functionality of Siebel.

Michael Maoz, vice-president and fellow at analyst firm Gartner, said Siebel users on versions prior to 7.5 would probably be encouraged by Oracle to upgrade to 7.5. He urged companies considering future Siebel products for the IBM Websphere and Microsoft .net platforms to reconsider, because Oracle is likely to favour its own platform and database.

Erin Kinikin, vice-president at Forrester Research, said the Siebel acquisition would threaten the CRM investments of companies currently using Oracle or PeopleSoft CRM because of the forthcoming Project Fusion.

With Fusion, Oracle plans to make all CRM, and other products from its many acquisitions, interoperable via a large Oracle software platform based on service oriented architecture.

Kinikin said, "These users should expect a reimplementation during the Fusion migration."

However, she said the acquisition had some benefits for users, because it will give them another option for CRM. "If Oracle can retain Siebel's expertise and get the right mix of features into a single, J2EE-based product line, with a hosted option, they should be a good long-term CRM choice," said Kinikin.

"Siebel's CRM expertise and consulting capacity in industries such as financial services, telecoms and pharmaceuticals, as well as B2B sales, is a great asset for Oracle users who have not yet committed to CRM."

David Bradshaw, principal analyst at Ovum, said, "Oracle will need to support the existing Siebel applications for a period of time. There will need to be an equivalent set of guarantees to those given for the PeopleSoft and JDE applications."

When Oracle acquired PeopleSoft and its JD Edwards subsidiary in January it promised to support users until 2013.

Oracle declined to comment on the concerns voiced by analysts and users in the aftermath of last week's Siebel takeover. It adopted the same policy after its PeopleSoft takeover.


Oracle's shopping spree 2005

  • January PeopleSoft (CRM software)
  • March Oblix (identity management)
  • April Retek (retail software systems)
  • June TripleHop (enterprise search)TimesTen ("real-time" software)
  • July ProfitLogic (retail software) Context Media (content integration)
  • August i-flex (banking software)
  • September Siebel (CRM software)


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