Oracle’s great mopping up exercise continues. Today, the corporate software giant is announcing its purchase of Hyperion, a midsize player in the market that specializes in “business intelligence” applications, programs that suck information out of other programs and serve it up in formats that help executives make sense of their operations. Oracle is paying $3.3 billion, or 2 YouTubes, for the company.
It’s good to see Larry Ellison, the undertaker of client-server computing, getting back to business. He’s been taking something of a breather since his year-long shopping spree in 2005, when Oracle swept up PeopleSoft, Siebel, Retek,TimesTen, ProfitLogic, 360Commerce, and sundry other coding shops.
What Ellison knows is that the big growth days for Old World Software (the kind you actually have to install on your own machines) are over, but huge profits will be available for years to any company able to roll up the major suppliers, consolidate customer accounts, slash costs, and basically feed off the trillions of dollars of legacy systems that sit heavily in private data centers the world over. Those systems aren’t going anywhere fast.
The other goal is, of course, to eat away at the franchise of archenemy SAP, the biggest supplier of heavy-duty enterprise applications. Oracle gleefully pokes at the German behemoth in its press release today:
“Hyperion is the latest move in our strategy to expand Oracle’s offerings to SAP customers,” said Oracle President Charles Phillips . . . “Oracle already has PeopleSoft HR, Siebel CRM, G-Log, Demantra, i-flex, Oracle Retail, and Oracle Fusion Middleware installed at SAP’s largest ERP customers. Now Oracle’s Hyperion software will be the lens through which SAP’s most important customers view and analyze their underlying SAP ERP data.”
In case that isn’t clear enough, Oracle’s calling SAP’s bread-and-butter ERP system a low-level industrial commodity.
Now that McNealy’s left Sun, Oracle reigns supreme as Silicon Valley’s trash talker of record. The traditional corporate data center is dead, and Larry Ellison is dancing on its grave.
Nick-
It’s been awhile since I read Rough Type and the sensation moves me to effusion. Your writing is in a class apart from “blogging” — it deserves its own name (maybe “writing”?). Reading Rough Type is like picking up the Wall Street Journal after a stint of Fox News. I wish Rough Type were a portal with free email and stock quotes. Where can I buy a Rough Type T-shirt?
Like most techies who comment here, I’m going to vaguely agree and then angrily nitpick :-)
I’d agree that ERP systems are becoming a commodity, but most business will still need major in-house development work on top of these commodity systems. An organisation’s s/ware provides its working environment – much of which is identical to other firms and can be treated as a commodity – some of which will always be different.
The OldSoftwareWorld is thriving and it will be for a long time. Ask 8m World Of Warcraft users. The reason most client side s/ware is hard to maintain is because it was written badly. My laptop is fully of applications that update their code flawlessly and required no configuration to install. It’s not fair to condem the desktop on the basis of the crappy VB6 legacy apps that big corporates use.
If you’ve had any experience of trying to integrate off-site solutions, you would know that the corporate data centre is here to stay. Sending increasingly huge data streams between various ASPs is hopeless – the network physically chokes. Don’t even get me started on the agonizing pain of WS-* and other mystery meat SOA “solutions”.
Start counting all the SMEs running their business off 1 hosted Windows SBS (or XServer) box, the number of data centres is exploding. A fully supported small company server from a good managed hosting firm is only about £7k per year. Go do that instead of stapling systems together from GoogleApps and sticky tape!
The future is going to be dominated by cheaper, better datacentres – running mostly standard, mostly open-source, components. You will get ASPs providing infrastructure, but it will be spam filtering, back-up storage, video streaming and fax gateways – not accounting or email. In the short-term there are special cases like Salesforce.com, but these apps will get folded back into the datacentre when someone releases an installable CRM that doesn’t suck.
The point of IT is state management: systems must provide one coherent picture of the organisation to everyone who needs it. This becomes harder and harder to do the more you distribute data over the net.
I stupidly didn’t realise that my e-mail was going to go on that comment. Could I have it purged???
I’m slightly worried that I’ve openly panned some of the larger trends in the industry (esp. as SOAP is a big selling point on my CV) in a way that’s linkable to my real identity. This post might well be more informative about IT than my last post :-)
Thomas,
It’s odd that it shows your email address. If I could delete it I would, but I think it’s set in the Typekey system, so you’ll have to get into your profile to change it. (Or maybe you entered your email address into the space for web address.) If you’d like me to delete your comments I will, and then you can repost without submitting your email.
Nick
Ah, nevermind. On second thoughts, it seems a bit paranoid. And I don’t really want to work for large IT consultancy in the near future. In 6 months they’ll have moved past SOAP to the next fad anyway :-D