Erik Keller: When bad blood hurts customers
Erik Keller -- Manufacturing Business Technology, 5/1/2007
Oracle alleges that SAP—via SAP’s TomorrowNow subsidiary—illegally downloaded more than 10,000 documents and software copies over a period of months through the use of user IDs and passwords it obtained from Oracle customers who were in the process of dropping maintenance in favor of TomorrowNow.TomorrowNow is a third-party provider selling discounted maintenance to PeopleSoft, Siebel, and J.D. Edwards (JDE) customers. Are you beginning to get the picture?
Now Oracle reportedly is suing SAP for “corporate theft on a grand scale.” Oh boy. As if things were not tense enough between these two competitors, this lawsuit is going to take a bad situation and make it horrible.
Some would say that SAP started this mess by purchasing TomorrowNow, which actually was launched by former PeopleSoft employees right after Oracle purchased PeopleSoft. You can’t really say that buying TomorrowNow was part of the big picture for SAP—like NetWeaver or service-oriented architecture (SOA)—but rather a way to get under Oracle’s skin and grab dissatisfied PeopleSoft, JDE, or Siebel customers.
On the other hand, Oracle has never been coy about its disdain for SAP. It rarely misses a chance to publicly disparage the company even though the majority of SAP customers run the Oracle database. Oracle’s desire to thump the Walldorf, Germany-based company with good-old-fashioned bare-knuckles competition is core to its aggressive acquisition strategy.
So given this kind of face-off, customers need to ask: How does this affect me?
At the outset it will give many buyers—especially those using TomorrowNow—pause when they are thinking about getting off standard maintenance. Events like this often have the ability to freeze—or at least slow down—disruptive decisions.
But more importantly it will make it even more difficult for two companies that need to work together in the best interests of their mutual customers to collaborate. For example, for SOA to become a reality, business semantic definitions—as well as some technical bits—need to be standardized across providers and technologies. Do you think after this legal episode that SAP and Oracle will want to collaborate on anything? Not likely.
Also because of the nature of this case, executive management of both organizations will spend an inordinate time preparing and strategizing over its progression. Their focus will be to beat each other badly—and who could say that this is a productive use of their time?
If this does come to trial, myriad industry dirt and unbelievable business practices may come to light. Quite frankly, we all saw what disclosure did for business and customer satisfaction a few years back during the Oracle-DOJ trial. It will be no better this time.
Perhaps I am naïve, but wouldn’t it be a good idea for both SAP and Oracle to go into a room, admit where each of them is somewhat lacking, hammer out a settlement, and then go back to what we all pay them for: putting out great products that help our businesses be more competitive?
Is that too much to hope for?
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