Oracle-Siebel deal could mean better integration

Von Marc L.

One of Oracle Corp."s main talking points Monday in touting its US$5.85 billion buyout of Siebel Systems Inc. was that shared users have been calling for such a move. "Our joint customers have consistently recommended this transaction to both companies for over a year," Oracle President Charles Phillips wrote in an open letter to customers posted on the company"s Web site. "Together [with Siebel] we become a stronger, more strategic partner, with complementary resources and maximum deployment flexibility. Our customers and partners have asked for it directly."

At least one major joint Siebel-Oracle customer agrees that the merger could be very good news. Barry Libenson, CIO at Ingersoll-Rand Co., said the buyout could allow Oracle to eventually provide out-of-the-box hooks between Siebel CRM systems and Oracle back-end systems, hooks that now must be custom-written.

The Montvale, N.J.-based provider of services and products to the transportation, manufacturing and agriculture industries has about 5,000 users of Siebel 7 software -- including analytical, sales force automation and call center applications. It also has a multimillion-dollar investment in the Oracle E-Business Suite, although not for Oracle CRM.

"The biggest win for us is the tight integration," Libenson said of the Oracle-Siebel deal. "We"re a $12 billion company, and anytime we reduce the number of partners it"s a benefit."

Even so, he did have some caveats, saying, for example, that he wants to see both the Siebel and Oracle sales forces maintained through the merger. "We rely on the expertise that Siebel brings to CRM just as Oracle does to the database and applications." And he wants Oracle to leverage the best in Siebel, but "not reinvent the wheel."

Other joint users were more circumspect about what the deal will mean. "I don"t know the advantages, it"s too early to tell," said Russell Joyner, vice president of IT at First Service Networks, a Linthicum, Md.-based facilities maintenance provider. The company runs Siebel 6 field service and call centers apps on the front end and a J.D. Edwards OneWorld financial application running off an Oracle database on the back end. J.D. Edwards products were swept into Oracle when Oracle bought PeopleSoft.

Monday"s announcement means that -- outside of the company"s desktop applications -- First Service Networks is an all-Oracle shop now.

"I"m pretty neutral on the Oracle deal," he said. "It appears that Siebel will become Oracle"s CRM product line and eventually it could disappear as a brand. However, it"s likely that current Siebel customers will be supported for a significant period of time in order to capture the recurring revenue associated with the installed base."

Although he has no plans for now to upgrade his software, at some point, Joyner will probably sit down and negotiate a single agreement for his licenses that could save money. "I"ve been a satisfied customer of all three applications and as long as they don"t mess with things we like, like technical support, we"ll continue to be happy," he said.