Oracle to Buy Siebel for $5.85B
Today the much-anticipated rumors proved true, as Siebel was swallowed up by the voracious Oracle. Lots of news, analysis and a few delicious quotes.
One of the drawbacks to running a topical information site while working for a company in the space is that when interesting news comes out about your company, you can't talk about it much.
One thing about this news, though, it certainly generates a lot of opinion! The 'best quote of the day' award goes to Christopher Lochhead, chief marketing officer at Mercury Interactive, a customer of both Oracle and Siebel, cited in this ZDNet.com article on the buyout:
Hey, I can't talk about the deal much, but you can! Comments welcomed.
One of the drawbacks to running a topical information site while working for a company in the space is that when interesting news comes out about your company, you can't talk about it much.One thing about this news, though, it certainly generates a lot of opinion! The 'best quote of the day' award goes to Christopher Lochhead, chief marketing officer at Mercury Interactive, a customer of both Oracle and Siebel, cited in this ZDNet.com article on the buyout:
"It's like peanut butter and chocolate: Both are great but taste better together."Meanwhile on the other, less-funny-but-trying-desperately end of the media quote spectrum we have Marc Benioff, CEO of Salesforce.com and budding paleontologist:
"Even dinosaurs mate a few times before they die. It's the end of software. It's the end of Siebel."... proving that Mr. Benioff is not only willing to say anything to get his name in the paper, but he doesn't even know the difference between a dinosaur and a fruit fly.
Hey, I can't talk about the deal much, but you can! Comments welcomed.
3 Comments:
Aaron Zornes put out an alert by email yesterday, telling Oracle that the CDI products Siebel is pushing - UAN and UCM - are mission critical. How do they stack up against Oracle's Customer Hub products?
Well, that's one of those areas that I can't really talk about until the transaction is complete. Oracle and Siebel say they will communicate updates with customers after the close of the transaction, which is expected to occur in early 2006.
Here's what they are saying in a nutshell: Siebel intends to continue to deliver enhancements and improvements to its current products. No change in the product plan. After the close of the transaction, Oracle plans to make Siebel’s products and services the centerpiece of Oracle’s CRM strategy.
Looks like I wasn't the only one who thought Benioff was being inane and obnoxious. Here's Bruce Cleveland's letter, which was published today on Ziff-Davis' ZDNet.com.
_____________________________
Dear Friends and Colleagues,
I couldn’t help but notice how many articles were written earlier this week about Marc Benioff’s email to salesforce.com’s employees on his thoughts concerning Oracle’s proposed acquisition of Siebel Systems. In keeping with his company’s Dreamforce theme, Marc seems to be dreaming big, hoping that the fabricated tales he spins become facts. Sadly, for him, they’re simply not true. Let me illustrate.
Marc infers that salesforce.com has been putting Siebel customers out of their misery for years. Yet, Siebel Systems has added more than 500,000 ‘live’ users of its CRM applications since the beginning of 2005, while salesforce.com has added approximately 100,000 subscribers. And our win rate in OnDemand software versus salesforce.com was approximately 58 percent in our most recent financial quarter. While Marc may covet Siebel’s customers and has won a few of them, these have been SFA deals – not Business Analytics deals, or self-service deals, or customer order management deals, or customer data integration deals. You get my point. Marc is not in the same league as Siebel Systems in terms of the breadth of solutions we provide for leading organizations worldwide.
He keeps repeating the mantra, “It’s the end of software.” Well, if this is the case, somebody had better tell the tens of thousands of developers at IBM, Microsoft, Oracle, Computer Associates, Google, Yahoo!, and salesforce.com that they need to change careers – not to mention the hundreds of thousands of custom developers at private and public sector organizations. Is Marc implying that there is no need for software developers and that he has no software developers at HIS company? This is an inane statement.
Marc implied that Siebel Systems sells client/server software and that, with its acquisition announcement yesterday, “client/server software is being consolidated by Oracle.” The fact is that Siebel Systems’ last release of client/server software was in 2001. Marc may want to spend less time on the Big Island and more time studying his competition.
Marc wrote, “Siebel On Demand (sic), a joint venture between Siebel and IBM, will be the first to be buried. Siebel On Demand is written exclusively on DB2 and Websphere and runs in IBM data centers..” Actually, Siebel CRM OnDemand is written on Siebel 7.5.3, our market-leading suite of CRM applications. Siebel 7.5.3 runs on virtually any application server and any database. And Siebel CRM OnDemand can theoretically be hosted by any hosting provider. Now, given our close partnership with IBM, we have chosen to run Siebel CRM OnDemand on DB2 and on WebSphere, and to use IBM’s world-class hosting services. But there is no technical linkage that precludes us from working with other companies.
Regarding Marc’s remarks that Oracle will “kill” Siebel CRM OnDemand, I point you to the replay of the press conference call conducted by Oracle at 5:30 a.m. Pacific on Monday, September 12th announcing the acquisition (1.866.357.4207; int’l: 1.203.369.0123 – Passcode: 6524). Here is what I heard Larry Ellison say word-for-word,
“We think OnDemand is going to be increasingly important. We think the Siebel OnDemand products have — are improving at a very, very rapid rate and we intend to invest in them heavily. In fact, we expect that all of the Siebel product features and functions that they have in the software products will migrate to the OnDemand products. So we think that is again a very important asset that we want to preserve and invest in as the acquisition is concluded."
So what’s really going on here? It’s easy. Marc is running scared, and when he runs scared he attacks. Pending the successful close of the proposed acquisition announced Monday, Marc will face the following large and well-funded competitors in the next several months: Microsoft – which last week announced it will enter the hosted CRM software market, SAP – which has also announced it will enter the hosted software market, and Oracle. He will also face increasingly hungry and aggressive competition from smaller companies. For example, last Monday NetSuite put out a press release announcing that more than 100 companies have switched from salesforce.com to its products.
Let the fun begin!
Bruce Cleveland,
Senior Vice President, Products
Siebel Systems
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