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Oracle, PeopleSoft clash anew

The two firms, which increasingly are aligning along particular industries, compete for markets such as telecommunications.

Fierce rivals Oracle and PeopleSoft are pushing further into specific industries with the help of some services friends.

Oracle today announced a partnership with Price Waterhouse and Sun Microsystems in which the three will team up to offer the telecommunications industry software, services, and hardware tailored to its specific needs.

PeopleSoft announced a similar deal with Price Waterhouse foe Andersen Consulting to offer services and software to the financial industry.

Software companies increasingly are aligning their businesses along specific industries, so-called vertical markets. PeopleSoft, for instance, has organized its business so that any customer that comes in the door can be slotted to a specific industry. Last week, the Pleasanton, California-based vendor bought its partner in the retail market, Intrepid Systems.

"ERP vendors have to move vertically," said Harry Tse, analyst at Yankee Group in Boston. "This is the fifth year into the major ERP replacement cycle. The next wave of growth is verticals."

Tse pointed to industries like telecommunications and the automotive industry as virgin territory for the ERP players.

Called Compas, the telecommunications product comes at a time when the industry it targets is in the midst of reinventing itself as deregulation fuels mergers throughout the industry.

Oracle and its partners are hoping the fierce competition among telecommunications companies will drive some business their way as they search out ways to streamline their businesses and dig up new customers.

"Telecommunications is an industry that by the nature of the business is not a good match for the ERP backbone because a lot of times the IT infrastructure consists of a collection of home built systems," Tse said. "There are very few systems you can buy to tie it all together."

This is where Oracle is hoping to step in with its new package.

Compas includes the full compliment of Oracle Applications, its Universal Server database, server hardware from Sun, and implementation, integration, and industry expertise services from Price Waterhouse. Besides Oracle's enterprise resource planning modules of human resources, manufacturing, and financials, the application package includes front-office apps such as sales force automation and applications specific to the telecommunications market such as services management. The service and package of applications are available now.

With a less catchy name, PeopleSoft Profitability Management for Financial Services is designed for banking, insurance, and capital market firms. It is to be a product suite for analyzing and measuring performance indicators of business ventures such as profitability. PeopleSoft and Andersen Consulting are jointly developing the software scheduled for release early next year.

The package is to include such functionality as funds transfer pricing, risk-weighted capital, and asset liability management functionality as well as reporting tools, a data warehouse, and other analysis and planning tools for the financial industry.

Tse said Andersen is the key player in this alliance as PeopleSoft tries to break into the high end financial market, moving beyond the human resource department where it has traditionally been stuck.

"Andersen definitely brings expertise and the installed base with them," Tse said. "PeopleSoft has not been selected as an enterprise standard for large organizations. In this case, Andersen is bringing more to the table than PeopleSoft. PeopleSoft needs Andersen to gain those high end accounts.

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