The Big Fight for the ERP market

For those who came in late:
The number of major enterprise software players started decreasing in the year 2003. PeopleSoft Inc. bought rival JD Edwards for $1.7 billion. Meanwhile Oracle had already started on its quest to acquire PeopleSoft and by late 2004 had forked out S10 billion for it.

The period saw antitrust cases against oracle in the US. Oracle was becoming dangerously big and the scene was reminiscent of the cases against Microsoft getting too big and dominating in the software markets during the late 1990s. The cases were ruled in favor of Oracle and business continued as usual.


Cut down to present day:
Oracle has just yesterday announced its decision to buy rival CRM software company Siebel Systems for $5.85 billion. With that Oracle is slated to become the number one CRM applications company in the world.

The deal further bolsters Oracle's aggressive drive to overtake SAP as the world's largest maker of business applications software -- the computer coding that automates a wide range of administrative tasks. In the past nine months, Oracle has either completed or announced five takeovers of business applications software makers, an expansion that has cost more than $17.6 billion so far.

This obviously has the other big companies in the enterprise customer market Microsoft and IBM scrambling for shelter. Microsoft was very late to start off its ERP product line and will now find it much more difficult to get a foothold in the market. Meanwhile IBM’s solutions have had compatibility problems with Oracle’s softwares- its focus had been on solutions based on ERP’s like PeopleSoft. And would SAP still be around a couple of years down the lane?


Since Oracle has its own suite of ERP packages it won’t be long before it kills the competing product lines acquired by it. That would leave thousands of businesses with no other option but to shift to Oracle or look elsewhere. How soon that happens remain to be seen. These businesses and software solution providers that have invested millions of dollars in ERP implementation will now have to helplessly watch all that money go down the drain. And there are all those people who would now lose their jobs.


There are a large number of small players bringing out exceptional products. But if Oracle continues on its quest to be the biggest, these specialized companies will be gobbled up either by Oracle or by Microsoft (which has already starting by targeting the small and medium-size companies). Last year Microsoft made an attempt to buy SAP but backed out when it realized the complications involved. Just like Microsoft’s Windows OS runs on more that 90% of the world’s desktops, it won’t be long before somebody totally owns the ERP market. When that happens we would have some really terrible software around ourselves.