Only days after PeopleSoft announced
plans to acquire J.D. Edwards, Oracle has announced it will attempt
a hostile takeover of PeopleSoft for $5 billion — a move that
could have grave effects on iSeries customers.
“The extreme would be that
Oracle is successful in their takeover of both PeopleSoft and its
latest acquisition, J.D. Edwards. Oracle does not see a future in
iSeries products, and OneWorld on iSeries will be history. Because
J.D. Edwards is the number one vendor for the iSeries, this is very
bad news,” says Tom Bittman, vp of technology and marketing,
Gartner Consulting Group, Danbury, CT.
If Oracle is successful, the merger
will create the second-largest global business application vendor,
after SAP. Oracle has already stated that it plans to stop selling
PeopleSoft products, but it will continue to support current users
for some time. It also could potentially swallow up J.D. Edwards,
which has a large and loyal iSeries customer base. Even if the Oracle
buyout doesn’t come to fruition, it may have already put a
strain on PeopleSoft and J.D. Edwards sales.
“The worst-case scenario
seems very possible — that Oracle is doing this only to freeze
PeopleSoft’s sales. This, in turn, might freeze J.D. Edwards’s
sales, leaving iSeries customers uncertain as to the long-term stability
of their suppliers,” says Wayne Kernochan, senior vice president,
Aberdeen Consulting Group, Boston, MA.
At the annual J.D. Edwards user
conference last week, the company’s chairman, president, and
CEO Bob Dutkowsky said that Oracle’s plan to buy PeopleSoft
“raises such serious antitrust implications that it will require
months of evaluation,” and that it is likely the deal will
be reviewed by the government. Oracle has said it will evaluate
the buyout of J.D Edwards if it is successful in the takeover of
PeopleSoft.
“It is also possible that
Oracle will buy PeopleSoft but that the J.D. Edwards deal will not
go through. I don’t think Oracle is really interested in J.D.
Edwards, but PeopleSoft plus J.D. Edwards is too big of a target
to ignore,” says Bittman.
Concerns surpass Oracle bid
Even without Oracle in the mix,
the PeopleSoft acquisition of J.D. Edwards is raising some eyebrows
and some concerns. Even though, in an interview last week, PeopleSoft
executive DeeAnna MecPherson told the Insider that “The iSeries
space is something we are very excited about,” the company
has not officially committed to a timeframe estimate in which iSeries
shops can expect to have support.
“The PeopleSoft acquisition
was concern enough. We (Gartner) have tried to get executives at
PeopleSoft to make a statement of support for J.D. Edwards products
on the iSeries, and they refused. Unless they make a statement of
long-term support, we will say that we don’t trust PeopleSoft,”
says Bittman.
PeopleSoft and J.D. Edwards have
announced they will proceed with their original plan, slated to
close in Q3, 2003. Regardless of the final decisions these three
companies make, customers should be planning for an uncertain future.
J.D. Edwards clocks iSeries benchmark
J.D. Edwards benchmarked 14,148
concurrent Web-based users with J.D. Edwards 5, their flagship
financials, distribution, and manufacturing applications,
running on iSeries. This is the first time that J.D. Edwards
5 has scaled past the 10,000 user mark on any server platform.
The J.D. Edwards on iSeries benchmark was achieved based on
realistic user processes running on IBM’s POWER4 64-bit
microprocessors.
“I suggest that customers
start creating a contingency plan. What if the development of OneWorld
ends in a year and support is gone in three? Reality says that it
will still survive for a few years, but PeopleSoft needs to officially
tell that to J.D. Edwards’s customers,” says Bittman.
4 issues of Insider Weekly – Award winning research of
what’s new, what’s working, what’s not –
You’ll stay on top of market conditions and IBM’s ever-shifting
strategies and make the best moves for your shop.
iSeries 400 Experts Journal – Enhance your technical
skills right away with guidance from the industry’s best
on OS/400, DB2, RPG, security, networking, Java, WebSphere and
more!
BONUS! 2003 Complete Archive CD (a $295 value) If you decide to become a subscriber, you get the most comprehensive
knowledgebase of iSeries 400 expert how-to advice and management
insight covering V4R3 to V5R2 from Insider Weekly, iSeries 400 Experts
Journal, and Inside Version5. It’s all on one easy-to-use
CD so you can find what you need fast.
Yes. Please send me one month of the new iSeries 400 Experts Total
Information Service (TIS) with no obligation. If, after reading
it, I decide iSeries 400 Experts TIS isn’t for me, I can simply
write cancel on the bill — and I owe nothing. The first month’s
issues are mine to keep, free.
Otherwise, I’ll send $495 for a full year of expert advice
— that’s $100 off the regular rate — for iSeries
400 Experts Journal, Insider Weekly, and Complete Archive CD-ROM.
(a $959 value)
100% No-Risk Guarantee: If I’m ever
unhappy with my subscription to iSeries 400 Experts, I can receive
a full refund.
Copyright 2000 ucg. All rights reserved. Do not duplicate
or redistribute in any form. The 400 Group is available for internal use
only by authorized users. The 400 Group, 11300 Rockville Pike, Suite 1100,
Rockville, MD 20852. phone: 301/287-2700 fax: 301/816-8945
