Oracle to lay off 2,000 after Siebel acquisition

10.02.2006
Oracle Corp. is laying off 2,000 people as part of its acquisition of Siebel Systems Inc.

Oracle closed the US$5.84 billion buyout of the CRM software vendor last month and has started the paring down of staff and creation of a product roadmap. During a webcast for the financial analyst community late Thursday, Oracle executives announced that the company is cutting its workforce down to about 55,000 employees. Oracle President Charles Phillips said that the philosophy behind the merger was to have as little change or disruption as possible to customers.

Most of those employees being laid off will be Oracle's, said Oracle CEO Larry Ellison. Some personnel are back office employees; others worked on Oracle's own E-Business Suite 11i. With Oracle already moving forward on its Fusion next generation set of best-of-breed applications, there actually were more development personnel than the company needed, he said.

However, the global salesforce for Siebel will remain intact, which will help ensure that any pending deals in the sales pipeline won't be lost, said Ellison. The best of Oracle's CRM reps will be folded into the Siebel salesforce, he said,

"Notifications have begun and the majority will be completed over the next few weeks," company spokesman Bob Wynne said in a statement.

While Oracle executives were upbeat about Siebel's analystics offerings, they were less enthusiastic about the Siebel integration initiative that had been dubbed "Project Nexus." Ellison said that the few Nexus customers Siebel had would continue to receive support, but the technology would not become the basis for Fusion. Additionally, while Oracle will allow IBM in the near term to host and manage the Siebel OnDemand business, it plans ultimately to move the business over to a grid-based infrastructure running Linux supported by Oracle's database.