Although Hyperion CEO and President Godfrey R. Sullivan Thursday, telling them in a letter that the deal would be good for both companies, that view was not universally shared.
Bart Klein, vice president and manager of application development at UMB Financial Corp. in Kansas City, Mo., noted that Hyperion is the latest of the best-of-breed vendors used by the bank to be snapped up by Oracle. The bank, he said, also uses Siebel CRM software, Stellent content management tools and Versatility call center products, which have all been acquired by Oracle.
"What is next?" Klein said. "While not our intention to put all of our technology investments in the hands of a single vendor, the consolidation of the industry has led to precisely that. I am very concerned that businesses will lose leverage as a result of this continued consolidation of major technology solutions."
David Dowling, Hyperion Financial Management administrator at Flint Group, an Ann Arbor, Mich.-based supplier of printing inks, plates and pigments, said he also has concerns about the deal. 'As Hyperion has grown as a company their customer service and support has declined,' he said. 'I think this will be a step in same direction.'
In addition, Flint now runs the financial management package from Hyperion on Microsoft's SQL Server, and Dowling said he is concerned that Oracle will force the company to move to its own database.
However, Diane Maluzhinsky, a financial specialist with General Dynamics Land Systems in Sterling Heights, Mich., applauded the move. Her company, which designs and builds land and amphibious combat systems for the military, has been using Hyperion's Essbase product for eight years, she said.
But because the organization also was a heavy user of Oracle's ERP applications, Maluzhinsky said she constantly had to justify the investment in Hyperion's OLAP tool over Oracle's. "Oracle has its own OLAP product, but it didn't stand a chance against Hyperion," she said. "It didn't have the strength Hyperion had."
In addition, while the organization uses Oracle's financial software to close its books, Oracle did not have a mechanism to consolidate those financial reports at a corporate level, she added. Therefore every month the company had to dump all the data from Oracle into Hyperion to be consolidated before sending to the corporate office, she said.
"The combination of the two will make them very powerful," she said.
Wayne Eckerson, director of research at the Data Warehousing Institute, questioned whether Hyperion customers will get significant benefits from the deal. "Hyperion was doing well, and it has some innovative products in the pipeline," he said. "Will Oracle leave Hyperion alone? I doubt it. Will Hyperion continue to innovate? I'm not sure."
However, Eckerson also noted that Hyperion's planning, budgeting and consolidation software fill a big gap in Oracle's business applications strategy. Adding the Hyperion products to the Oracle line would also give the vendor "a huge presence in the chief financial officer's office," helping it better compete against SAP, he said.
Cindi Howson, author of the independent BIScorecard.com report, which evaluates BI tools, noted that Oracle took several years to leverage the Express Online Analytical Processing (OLAP) engine it gained with the purchase of ORI Software in 1995. "I hate to think Essbase (Hyperion's OLAP engine) may fall to the same fate," she added.
However, she noted that the move is a smart one for Oracle, considering the convergence of BI and performance management and Microsoft's maneuvering to release a competing set of products. In addition, the Hyperion products coupled with the analytic tools acquired from Siebel will give Oracle a "powerful portfolio of products," Howson said.
Mark Monn, director of performance management and research at Hyperion user Family Services of Metro Orlando, expects that the deal will prove positive for his organization.
"For us it would be a benefit, as we have a good relationship with Oracle and our primary database is [Oracle] 10g," Monn said. "It will hopefully allow us to leverage both products better as I hope they will integrate the best of Oracle and Oracle's BI with Hyperion."
Paul Hamerman, an analyst with Forrester Research, said he expects Hyperion users to fare well because "Oracle wants to keep these customers renewing their maintenance contracts."
"The products themselves and the customers' ability to get support and enhancements on those products is not going to be jeopardized at all," he said.
However, he noted that Oracle typically increases maintenance costs for users over time, which could be a concern to some Hyperion users.
"The challenge will be to integrate Hyperion products as the leading products and integrate them with the ERP transactional system," Hamerman said.