Big Blue no white knight for PeopleSoft

Von David Watson
The recently announced alliance between IBM Corp. and PeopleSoft Inc. won"t do much in the short term to make it harder for Oracle Corp. to acquire PeopleSoft, according to Gartner Inc. Australia analyst Kristian Steenstrup.

"It"s just been announced and will take some time to come to practical fruition, so it"s unlikely to interrupt the acquisition process", says Steenstrup.

Steenstrup"s views are in contrast to those of Forrester analyst Paul Hamerman, who says "I think (PeopleSoft is) working towards a technology poison pill here."

Gartner issued a "first take" report shortly after the alliance was announced and noted "this announcement does not pose a further roadblock to Oracle"s unsolicited bid for PeopleSoft and nor does it indicate any increased likelihood that IBM will attempt a friendly takeover of PeopleSoft, should the Oracle deal advance."

Or, as Steenstrup puts it, "Big Blue as a white knight is a red herring."

The first take report also notes "PeopleSoft presents a vision of adaptive business processes, which aligns with Gartner"s vision for applications.

"However, PeopleSoft needs to rapidly articulate a road map of how to get there and PeopleSoft customers should evaluate how the increased presence of IBM WebSphere middleware and tools could affect their own architecture and strategy.

"IBM customers should expect increased availability of applications built around WebSphere."

The IBM-PeopleSoft alliance involves PeopleSoft optimizing its applications for WebSphere and selling WebSphere products direct via its own sales staff.

The two companies will also jointly develop software packages for the financial services, telecommunications and insurance industries and will together invest US$1 billion in the project over the next five years.

The alliance ties in nicely with PeopleSoft"s acquisition of JD Edwards, which also standardized on IBM before the acquisition.

The deal is "not an exclusive technology relationship," Steenstrup says.