More than just ‘suite talk’

(Conclusion)

Oracle Corp. may have said a mouthful in its pitch for its new suite of online business applications. But it seems it is now realizing that it will take more than mere sweet talk to convince business executives to believe its pitch.

Almost a month after its high-profile Applications World Conference in New Orleans, Louisiana, the world’s second largest software company is still having a hard time convincing people that its E-Business Suite – a one-size-fits-all package of business apps – would make companies save billions of dollars.

In a report by ZDNet News, early customers of the software were quoted as saying that the supposedly "complete, simple" and "at Internet speed" suite suffers from bugs that made installation difficult.

"It has been a slow and arduous process," said one computer department chief in the report. "It would be nicer if the early versions of the software were more stable coming out of the box." The man quoted by ZDNet noted that it was "frustrating" upgrading to the Oracle 11i, which is another term for the E-Business Suite. He pointed out that he plans to slowly upgrade, test the system several times before going "live" with the applications which cover purchasing, accounts payable, inventory control, customer relationship management and others.

The reaction would surely displease Oracle executives, especially CEO Larry Ellison who told AppsWorld delegates that it would take only a modest amount of work to install their E-Business Suite.

Lisa Arthur, Oracle vice president for E-Business Suite marketing, dismissed the criticisms. She said the suite "is at a really rock-solid stage and really gaining a high acceptance rate with our customers."

However, DHL Worldwide, a giant parcel delivery company, was also quoted by ZDNet as having "struggled" when it installed one of the earliest releases of the E-Business Suite eight months ago in at least 12 areas in Europe and Africa.

"We were getting concerned that (the bugs) were going to impact our deployment schedule," said a DHL official. "They (Oracle people) fixed the bugs and corrected the problems and issues. That gave me confidence that Oracle is responsive and serious in putting its resources together to resolve the issues."

Shrinking market?

All Oracle executives who spoke at the New Orleans conference appeared more like salesmen selling a "miracle cure." From Ellison down, all seemed to be convinced that the E-Business Suite would solve all problems confronting businesses worldwide.

What probably prompted them to take such a hard-sell stance is the fact that other software companies – from Microsoft to Sun Microsystems – have made drastic moves to control the software market which is fast shrinking in the West due to the proliferation of so-called freeware or free software and the worsening problem of piracy.

Oracle, for one, has announced that it would offer certain "free applications services" in its refurbished Oracle.com website. And one of its executives told this writer during the AppsWorld that Oracle had been affected by software piracy, especially in Asia.

"I have to admit that we are victims, too, of piracy," said Derek Williams, Oracle executive vice president for Asia-Pacific. "Although our problem is not as worse as Microsoft’s, still (piracy) eats up some amount of potential revenues."

Based in Singapore, Williams said piracy remains to be the biggest thorn in the neck of software makers. "Unless intellectual property rights are respected in Asia, software making will never prosper there," he said.

Oracle earned a hefty sum in the third-quarter of its fiscal year, reporting last week a net income of $583 million. The figure met analysts’ expectations, although company CFO Jeff Henley said the economic slowdown in the United States had affected Oracle’s growth "more than we anticipated."

Last frontier

The development of the E-Business Suite may be targeted not at established Oracle users but those who are only beginning to automate their businesses.

A Gartner analyst was quoted as saying that first-time customers would find it easier and cheaper to use the suite. "The cost of maintaining a single complete application suite is definitely going to be lower compared with paying a hefty amount for systems integration work to cobble various applications together," the analyst said.

Williams, meanwhile, said Oracle is expanding its presence in Asia where many companies have not even tried automating the most basic aspects of their businesses, such as payroll.

He noted that 13 percent of Oracle’s worldwide income last year came from Asia and he is expecting a bigger chunk of their revenues to come from the continent in the coming years.

"Studies show that IT spending in Asia would increase by 25 percent this year," he said.

According to Williams, Oracle’s thrust in Asia is geared toward wireless technology, considered the last frontier when it comes to computer applications.

He said that unlike in the US, Asia will be next to Europe when it comes to mobile devices such as cellular phones and personal digital assistants. He foresees the day when billions of people in Asia will be surfing the Internet and engaging in electronic commerce through their mobile gadgets.

Oracle’s observation is definitely shared by other heavyweights in the industry. IBM, Compaq, Sun Microsystems, Microsoft, Hewlett-Packard, and even chip maker Intel, in fact, have crowded the ongoing Cellular Telecommunications and Internet Association (CTIA) show in Las Vegas.

The oldest wireless show in the world, the CTIA convention attracted IT bigwigs who all want to compete for the millions of wireless users who will, according to several forecasts, surpass the number of wired Internet users by 2003.

Jerry Yang, the founder of Yahoo!, was among those who attended the event. He announced a partnership with a wireless company to offer Yahoo! services to mobile phone subscribers.

"The wireless Internet has a higher value proposition than the wired Net," he said. "Done right, it’s more valuable because it’s mobile."