More Vendors Bail on Oracle in Favor of IBM

  • Written By: M. Reed
  • Published On: August 7 2000



More Vendors Bail on Oracle in Favor of IBM
M. Reed - August 7, 2000

Event Summary

Following on the heels of SAP AG and Siebel Systems, i2 Technologies, Inc., a leading Supply Chain Management vendor, and PeopleSoft, a leading Enterprise Resource Planning and Payroll/Human Resources vendor, have also chosen IBM's DB2 Universal Database as their preferred database for developing current and future applications, and as their preferred backend database for customer deployment. According to the vendors, PeopleSoft will use DB2 Universal Database as its primary Unix development platform for PeopleSoft 8, which is their latest Internet-based architecture. PeopleSoft 7.5 applications are now available on DB2 UDB for Sun Solaris, Microsoft Windows NT 4.0, IBM AIX, and IBM OS/390.

In addition, IBM has standardized on and is deploying Siebel eBusiness Applications across its entire customer-facing infrastructure, uniting sales, service, marketing, and call center professionals, including third-party business partners and their Web sites, serving more than 55,000 internal IBM users, 30,000 business partners, and millions of customers directly over the Web.

IFS AB, a leading ERP vendor which was previously Oracle-centric, has announced an agreement with IBM to add DB2 support. According to their announcement "IBM will collaborate with IFS to define, build, and execute joint marketing activities which will generate sales of IFS Applications licenses. Additionally, IBM will provide the required hardware, database licenses, and expert level consultancy resources to add DB2 support to IFS applications."

Market Impact

Oracle's focus on competing in the areas of enterprise resource planning, customer relationship management, supply chain management, financials, and many others, is hurting their database sales. Their database sales growth pales in comparison to the growth in their applications areas, and these vendor defections are a strong indicator as to why. (For more information about the SAP/Siebel defections, see Oracle Gets SAP'ed by IBM and "Oracle Loses Again".)

Oracle will continue to see strong growth in their overall product line, but TEC predicts (60% probability) that database server sales will continue to decrease as a percentage of overall revenue. On the other hand, IBM seems committed to DB2 Universal Database and its continued development and marketing, and does not compete in the applications areas as Oracle does. We believe that the product will continue to improve, and DB2 UDB Version 7.1 shows strong promise.

User Recommendations

Oracle 8i is an extremely strong database, but has recently been crushed by IBM's DB2 Universal Database in the latest TPC-C benchmark tests that IBM ran in conjunction with Microsoft and Intel. IBM's latest benchmark numbers approximately triple the best performance displayed by Oracle. (See "IBM's DB2 Tops TPC Benchmark List") Oracle and IBM should both be included on a short list of vendors for large transactional-based databases and data warehouses, but the price/performance ratios should be carefully considered by customers, and used as leverage for reductions in the price of the software.

 
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