Oracle OpenWorld: Charles Phillips
By Stuart Lauchlan.
When Charles Phillips took questions on Oracle’s hostile takeover bid for rival PeopleSoft at last year’s OpenWorld conference in London, he surely cannot have imagined that he’d be still facing the same questions twelve months on.
But just over a year onwards from that inaugural visit to OpenWorld in his then-new role as Oracle co-president, Phillips had to field still more questions about the still-running battle to win PeopleSoft. “There certainly have to be easier ways to buy a company,” he admits when asked if the protracted nature of this hostile bid means that Oracle will be more inclined to pursue friendly acquisitions in the future.
The world has learned a lot about Oracle and the way it works – and indeed the entire applications market place – since Phillips last appeared in London. Among the more interesting findings that has emerged as a result of the running court battle between Oracle and the US Justice Department is that the software vendor has a list – a hit list or a wish list depending on your point of view! – of potential acquisitions that it would consider.
“Ah, the famous list,” sighs Phillips with the air of a man who’s been asked about this once too often. “It’s certainly the case that our strategy towards acquisitions has changed over the past 18 months. We are a larger company and we have the capital to consider acquisitions. There are companies that are coming to us and asking to be bought. But a lot of acquisition activity is opportunistic. Siebel was mentioned as being on the list, but there were a lot of companies named on the list.”
As Phillips spoke, Oracle is still awaiting the outcome of its appeal hearing against the US Justice Department’s block on the PeopleSoft bid. Nonetheless Phillips continues to talk in terms of when the bid proceeds, rather than if. Inevitably it’s the only position he can take of course, but his demeanour remains calmly confident.
He doesn’t seem particularly bothered by renewed speculation that a so-called White Knight might come to PeopleSoft’s rescue, particularly with the stock price of PeopleSoft much reduced since the Oracle bid was originally launched. Microsoft has been much mentioned as a possible rival bidder (especially in light of the revelation that it cosied up to SAP with a view to proposing a merger!), but Phillips seems unconvinced.
“If the White Knight was Microsoft, the price wouldn’t really matter,” he laughs. “If there was going to be a White Knight then I would have thought it would have emerged by now. But you never can tell.”
Phillips was also quick to reiterate Oracle’s commitment to on-going support for PeopleSoft’s product set, but adds that this will not detract from continued development of Oracle’s own applications.”The acquisition of PeopleSoft will not detract in any way from Oracle’s applications development,” he says. “Oracle products are what we will be offering to new customers.”
On the other hand, JD Edwards (JDE) customers – the company was itself acquired by PeopleSoft last year and as such its product set now forms part of the Oracle bid – face a more uncertain future. Phillips points to reports of supposed unhappiness among JDE users since the PeopleSoft acquisition.
“There are a lot of JDE customers who are not currently happy with PeopleSoft,” he says. “There are some old platforms that we are not going to support, such as the AS/400. For customers on those platforms we will offer other options such as a move over to PeopleSoft’s Unix products or an outsourcing option.
“But it’s difficult to be as clear about plans for JDE customers as we are about PeopleSoft ones because we don’t know what’s going to happen to the products given the long nature of the takeover process. We don’t know what products will have been merged with PeopleSoft’s products by the time the deal closes so we can’t produce so much detail. What we can promise is a better support deal than they’re getting from PeopleSoft.”
But back to that “famous list,” Siebel was the name on the list that attracted the most attention, a situation made all the more so by Oracle CEO Larry Ellison’s throwaway remark that Tom Siebel had turned up at his house one night and asked him to buy Siebel. Is that really what happened? For the first time Phillips looks mildly discomforted. “Something like that,” he mumbles…