Murky future for PeopleSoft CRM a boon to Siebel

With Oracle only offering PeopleSoft CRM in specific cases, and not sharing what those cases are, CRM suite vendors and composite applications should benefit.

Growing confusion around Oracle's intentions with PeopleSoft CRM in the wake of the $10.3 billion takeover has left a gap in the CRM market.

While Oracle has said in the past that it will continue to offer PeopleSoft's CRM products to new customers, that is only happening in certain situations, which Redwood Shores, Calif.-based Oracle will not reveal, said Liz Roche, vice president of technology research services for Stamford, Conn.-based Meta Group. Just three weeks ago, many Meta Group clients listed PeopleSoft CRM as a contender on their short lists.

"I believe that Oracle is still trying to figure out what's going to work best for them," Roche said. "What we've started to hear from a number of sources, including Oracle, is that even though they'll continue to sell PeopleSoft CRM, they'll only sell it in very specific situations. They won't say what those situations are. I'm guessing it's in industries where Oracle doesn't have a lot of strength."

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In January, Oracle promised support for PeopleSoft's products  through 2013 while also developing the next generation of the PeopleSoft product line. Meanwhile, Oracle would undertake a strategy of merging the two company's products under an initiative titled "Project Fusion."

As Project Fusion evolved, Oracle salespeople would offer both PeopleSoft and Oracle CRM, according to the company. Yet without a clear definition of when PeopleSoft CRM will be made available, companies should no longer consider short listing it, said Roche.

Because PeopleSoft's CRM was the only ERP vendor's product able to compete as a standalone application, the news amounts to a boon to full CRM suite vendors, she added.

"The natural winner is Siebel [Systems Inc.]," Roche said. "PeopleSoft had really been the only enterprise suite that could be sold standalone. Oracle and SAP you wouldn't want to buy unless you're already running it in the back office."

Other big winners include midmarket vendors such as Pivotal Corp. and hosted vendor Salesforce.com, Roche said. Industry-specific vendors such as Amdocs Ltd., of Israel, which sells primarily to the telco industry should benefit as well.

While new customers need to reconsider purchasing PeopleSoft CRM, existing customers can continue to buy and should, in fact, renegotiate upgrade pricing and maintenance, Meta advises.

Enterprise suite vendors are not the only answer, however. More companies will begin to assemble composite applications.

"I think the future of CRM applications is going to look radically different than it does today," Roche said. "There's this post-modern idea of build-your-own software. You have the ability to assemble components or processes from various vendors and some you write yourself. I think that's where the future of CRM is heading."

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