Home
 > Research and Reports > TEC Blog > Oracle Gets SAP'ed by IBM

Oracle Gets SAP'ed by IBM

Written By: M. Reed
Published On: December 8 1999

Event Summary

"WALLDORF, Germany, and SOMERS, N.Y. - Dec. 7, 1999 - SAP AG (NYSE: SAP), the leading provider of inter-enterprise software solutions, and IBM (NYSE: IBM), the worldwide leader in data management solutions, today announced an agreement to expand their global sales, marketing and development relationship. As part of this agreement, the two companies will work together to provide expanded choices for customers that wish to implement mySAP.com Internet business solutions and IBM's DB2 Universal Database on a variety of hardware platforms. These platforms include Windows 2000, in addition to the already available solutions for Sun Microsystems, Linux, Windows NT and IBM's RS/6000, AS/400 and S/390 platforms. Through this expanded partnership, customers can now take advantage of broader flexibility for a wider choice of hardware platforms when using IBM DB2 with SAP solutions. In addition, customers will not have to incur the time or expense of changing their existing hardware platforms when porting to DB2 databases for SAP solutions."

Market Impact

Oracle has been competing with ERP and CRM vendors for some time, and many of them have become upset that what they considered their preferred database vendor was also a direct competitor. Siebel, a major player in the Customer Relationship Management (CRM) market, has already announced that it is changing from Oracle to IBM, and is transferring both its development facilities and preferred deployment database to DB2 UDB (Universal Database, which is the name for DB2 versions 5.0 and higher.) Now SAP has also abandoned Oracle, and is standardizing on DB2. According to SAP, benchmarks show DB2 performs around twice as fast as Oracle and SAP applications already use many other IBM products, including OLAP and data mining. (TEC predicted this development in September, see Vendor Challenges in "Oracle Co. - Internet Paradigm Boosts Applications Growth", September 1, 1999.) IBM has been smart enough to realize this, and has formed strategic relationships with the vendors as they abandon the Oracle ship. We expect this trend to continue, and it may spread to other areas such as business intelligence, sales force automation, financials, and others. As stated by SAP, "Today's announcement builds upon the strong relationship between SAP and IBM, which already includes DB2 and SAP joint product development and customer support, a joint marketing fund, a dedicated IBM DB2 sales team for SAP, dedicated SAP DB2 sales executives and sponsors worldwide, and integrated solution support centers in Walldorf, Germany; Toronto, Canada; and San Jose, Calif. In addition to DB2 Universal Database, IBM's data management portfolio of products provides SAP with support for business intelligence, multimedia asset and e-commerce applications." We believe the addition of Siebel and SAP customers to IBM's revenue stream will adversely effect Oracle's revenues, and we predict a negative impact on its database sales and overall earnings.

User Recommendations

Customers evaluating ERP and CRM packages should consider IBM's DB2 Universal Database (the current release is DB2 version 6). Given that DB2 UDB can be run on both IBM and non-IBM systems such as Windows 2000, Windows NT, Sun Microsystems (Solaris UNIX), Linux, IBM RS/6000 (AIX UNIX), IBM AS/400, and IBM S/390, customers will have the ability to pick an operating system supported in their environment. We believe that the software development relationship between SAP and IBM is strong, and we expect it to get stronger as customers begin to implement IBM/SAP solutions.

 
comments powered by Disqus

Recent Searches
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Others

©2014 Technology Evaluation Centers Inc. All rights reserved.