By Siobhan Kennedy
Oracle Corp placed Siebel Systems Inc on an internal most wanted hit list and instructed its employees to use all their resources to compete and not partner with the front office vendor, an internal email has revealed. The message, seen by ComputerWire, was written by Oracle president Ray Lane and addressed to all Oracle employees. It said Siebel was Oracle’s main competitor in the customer relationship management (CRM) market and as such cannot ever be looked at as a partner just because they use our technology. Lane said the competitive dynamic in the application market has changed radically in the last six months but that Oracle was not being influenced by this change, rather we are causing it.
In the revealing email, he went on to remind Oracle employees about how the database giant confused SAP and Peoplesoft in the early days. …..partner? competitor? he said, Now that they’re large it’s important that they receive our cooperation to use our technology….don’t confuse this approach with other smaller, but more important competitors, that we must focus on only as competitors. Then he added, referring to Siebel, There are two that I would like to put on the most wanted list and make sure we use all resources to complete, not partner.
The fact that Oracle has it in for Siebel is nothing new, as the company has made numerous aggressive, public statements about its intention to dominate the CRM market. It even went so far as to offer Scopus (which was acquired by Siebel last year) customers a discount for switching to use Oracle front office applications over Siebel’s, saying the number one CRM vendor hadn’t fulfilled its promises to Scopus customers who were left sitting in limbo waiting for a solution. But the fact that the company’s president has resorted to writing internal, private emails to instruct its employees to freeze Siebel out certainly seems to take that rivalry one step further. Siebel insists that it doesn’t view Oracle as competition and never runs into the company when pitching for new business, but it’s mindful of the database giant’s public threats and taunts.
According to Siebel’s VP of alliances Bruce Cleveland, Oracle used its partnership with Siebel to get a foothold in the CRM market and seed it with Oracle databases. Now the CRM market has taken off and Oracle, armed with its own set of CRM applications, has broken off relations with Siebel and its actively seeking to win the vendor’s customers- 50% of whom use Oracle databases – for itself. We invited Oracle to participate with us early on, when the market was still in its infancy, and it was very happy to do that, Cleveland said. Then, once we’d legitimized the market space we got excommunicated from the partner program and cut off from all information on Oracle’s new products and technology.
In a letter to Lane dated May 27 seen by ComputerWire, Cleveland said Oracle welcomed Siebel as an Oracle Alliance Partner because the company represented valuable incremental database revenue. He said the two vendors had engaged in a number of joint activities including advertising in Oracle’s magazine, joint selling, joint customer service and so on, but he went on to note. The message is clear: Partnering with Oracle is possible only until Oracle covets your market. Then your company will become the target of a direct and all-out attack. He added that Lane’s last point in his e-mail – that Oracle will be adding other companies, which it has lured in as partners – to its most wanted list, is profoundly troubling.
Cleveland said he believed Oracle was willing to sacrifice the needs of their joint customers to try and establish leadership in the CRM market. Moreover, he objects to the fact that the software giant is using confidential information from its partnership with Siebel in order to try and hog the limelight. He told Lane: We believe that a business partner should not use the other’s confidential information to recruit the other’s best people or target the other’s leads and customers. In other words, we believe that information shared with a partner, in a spirit of cooperation, should not later be used for unfair, anti- competitive purposes.
Cleveland said he also sent a copy of his letter to every company in Oracle’s Alliance Program, some of whom – he wouldn’t disclose who – have already written back expressing concern over Oracle’s territorial behavior. At press time, neither Ray Lane nor anyone from Oracle was available for comment. The news coincides with Siebel’s announcement yesterday to partner with Microsoft to push its SQL 7.0 as its chosen database platform, alongside IBM’s DB2. In addition, Siebel – sounding more like Oracle every day – is offering its Oracle database customers a chance to switch to using SQL server for just $170 per user, including installation, upgrades and service. It also plans to open up a joint technology center with Microsoft in Redmond where the two will work to optimize Siebel’s applications on the SQL platform.
