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Oracle Takes Aim at Salesforce.com

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Posted September 21, 2010 By Drew Robb     Feedback

Oracle unveils new CRM and applications products at OracleWorld — and unleashes criticism at competitor Salesforce.com.

Salesforce.com (NYSE: CRM) has been a dominant force in the sales force automation and CRM markets, thanks to the company's early embrace of the cloud.

Oracle (NASDAQ: ORCL) hopes to halt that momentum. At this week's Oracle OpenWorld conference in San Francisco, Oracle CEO Larry Ellison saved some of his most pointed comments for Salesforce.com.

Early in his talk, he got on a roll about cloud computing, complaining that some vendors were rebranding old technology and calling it "Cloud Computing." Then he got specific and claimed that Salesforce.com is really only offering software as a service (SaaS), which he dismissed as ten-year old technology. He considers Salesforce merely SaaS and not the cloud.

He accepted that cloud definitions varied widely, but offered his own.

"The cloud is a standards-based application, development and execution platform that includes hardware and software, is virtualized and elastic, and runs many apps," said Ellison. "It can run on both public and private clouds."

He held up the example of Amazon Elastic Computer Cloud (EC2). Ellison said you can build any app on an Amazon cloud, as it is virtual, based on open standards and works with Linux, Java, Oracle, MySQL, and so on. In addition, it is elastic — you pay for what you use.

How does Saleforce.com compare? Not very well, according to Ellison.

"Salesforce.com is merely one or two apps running over the Internet. It isn't virtualized, is proprietary and has weak security," he said.

He said customer data is dumped into one large database pot in Salesforce.com, as opposed to being held separately customer by customer. He said each customer's data needed to be protected through isolation by virtualization, while also having fault tolerance added and the eradication of single points of failure.

A true cloud application can scale up and down seamlessly in pace with demand, said Ellison. EC2, he said, fits the bill, while Salesforce.com does not. Why? It has to throttle down demand by turning off non-mission critical functions to ensure that application performance remains high.

The licensing model of Salesforce.com also came in for attack. It is priced per number of users, not by what is used.

Is Oracle Exalogic and CRM the Answer?

So what does Ellison offer up for sales force automation? He made the case that the new Oracle Exalogic Elastic Cloud provides a cloud-in-a-box architecture to help companies implement the cloud in the CRM field.

Oracle backs this up with a range of CRM tools that could sit on such a box such as Siebel CRM, CRM on Demand and a new batch of Oracle Fusion applications that include CRM modules.

Anthony Lye, vice president of Oracle CRM, covered Oracle CRM on Demand release 18, which includes a ton of new features.

"Probably the most significant change is adding best-in-class marketing," said Lye. He said the CRM vendor community has been saying for years that it covered sales, service and marketing equally well. This, he said, was a misrepresentation.

"We did well in sales, pretty good in service and did nothing at all in marketing," said Lye.

The result: Companies with a CRM system had to go to a third party for a complementary marketing tool. To address this, Release 18 has sales force automation along with marketing and a demand generation system.

"We can provide a single solution that is supported by one central data warehouse," said Lye.

Page 2: Business Planning, Oracle Fusion Apps

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