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CeBIT: PeopleSoft CEO Avoids the 'O' Word

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Posted June 19, 2003 By Clint Boulton     Feedback

PeopleSoft CEO Craig Conway discusses his company vision for the future of enterprise applications with nary a word about the hostile takeover bid from Oracle.

NEW YORK -- PeopleSoft Chief Executive Officer Craig Conway Thursday said his company will guide the market for enterprise applications into a new era where business software is Web-based and automated, and middleware will be rendered nearly obsolete.

Conway spoke at CeBIT America 2003, describing how his company is looking to improve the total ownership experience by reducing costs and dependencies on intermediaries such as middleware. While the room was full, the executive did not address the current hostile takeover attempt by Oracle . However, Conway did reiterate his hopes for a successful merger of mid-market applications provider, which his Pleasanton, Calif. company commenced today.

Conway evangelized on how the challenging economy was paving the way for companies in the enterprise software space to push ahead with new technology approaches under the umbrella term "real-time enterprise." His argument was that obstacles such as corporate governance under new Sarbanes-Oxley laws are only creating new opportunities for software makers to step in make doing business easier and over the Internet.

Conway said his company plans to push its embedded analytics capabilities even further to make applications more intuitive to what customers needs are. Tasks will be completed on the fly as the applications will react in "real-time" to adjust to changing requirements. With embedded analytics, custom configurations will not cancel each other out.

"Embedded analytics are the gauges on the dashboard of the corporation," Conway said. "But they don't do you any good if those gauges are telling you how fast the car was driving last week."

But in order for this to happen, some aspects of the enterprise software business need to change. Conway, noted that while PeopleSoft has written its applications to be integrated with those of its competitors, SAP and Oracle, those companies have not done the same. This, he said, is what is slowing down the evolution to real-time enterprise, where money is saved because less manual administrative work is needed.

"Most companies don't have applications from just one vendor," Conway said. "It's a burden to make them work together and that burden is on the customer. They have to buy packaged middleware to make them work together. The three companies should code the software so that they may be integrated out of the box. We are trying to remove the burden from the customer and put it on ourselves, but it's hard when the other two don't open up."

Such cross-functioning applications, he reaffirmed, would eliminate the need for the costly middleware.

Conway also said one of the keys of its bid to provide more choice for customers was to make PeopleSoft's software compatible with Linux. He likened the arrival of Linux to the arrival of Unix as a compelling alternative to mainframe operating systems, noting that Linux is an alternative to the Windows desktop operating system offered by Microsoft.

"We aren't anti-Microsoft or anti-IBM," he said. "We are pro choice."

Conway said PeopleSoft already has an advantage over rivals SAP and Oracle. He cited a Meta Group study that gauged how firms are improving the operating experience. Conway said Meta found that PeopleSoft was 52 percent less than SAP in total cost of ownership and 25 percent less than Oracle. He said his company can help customers realize even more cost savings and choice should the merger with J.D. Edwards succeed.

In closing, Conway reiterated the synergies of that deal, noting that there will be a large, mid-sized and AS 400-geared product lines to appropriately serve its combined 11,000 customers. The deal, he said, extends PeopleSoft's human resource applications into the middle market, where J.D. Edwards is strong, and extends asset and manufacturing applications to PeopleSoft's high-end market.

He noted that customers, analysts and even Wall Street praised the proposal despite being normally bearish on large acquisitions. It caught the interest of competitors, he said in his lone allusion to Oracle's bid.

"Enterprise software has moved into the era of total ownership experience," Conway said. "PeopleSoft is going to lead that transition."

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