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PeopleSoft cuts hosting prices

The software maker reduces the prices for its software hosting services by up to 15 percent, reviving its efforts in the growing market for pay-by-the-month business applications.

Tech Industry
PeopleSoft on Monday reduced the prices for its software hosting services by 10 percent to 15 percent, reviving its efforts in the growing market for pay-by-the-month business applications.

For $10,000 per month, PeopleSoft will support up to 100 concurrent users on a particular set of applications, such as those for human resources or accounting. For a higher price, PeopleSoft's "Ultimate" hosting plan covers up to 500 simultaneous users.

PeopleSoft has also improved the reliability of its hosting service, guaranteeing at least a 99.5 percent availability rate for access to its hosted programs, the company said. That's up from 95 percent availability, said Bill Henry, vice president of marketing and strategy for PeopleSoft Global Services.

The company said it will continue a partnership its J.D. Edwards unit forged six years ago with Seattle-based computer services firm WTS, which specializes in hosting J.D. Edwards software.

PeopleSoft, which began its foray into application hosting in 1999, contracts with Hewlett-Packard to provide hosting services to its non-J.D. Edwards customers. HP hosts the software at its Tampa, Fla., data center, Henry said.

The company on Monday also introduced a new program called Remote Hosting, which lets customers run the applications at their own data centers but gives PeopleSoft control of routine maintenance tasks such as performance tuning and patching.

Analysts say neither J.D. Edwards nor PeopleSoft, whose complex business systems are used by some of the world's largest companies, have been particularly successful in the fledgling software hosting market. The primary reason is that their software was not designed to be hosted, Forrester Research analyst Paul Hamerman said. Specifically, they lack the so-called multitenancy feature, which allows a single server to run programs for numerous customers. Multitenancy requires less hardware and reduces the cost of the hosting model, Hamerman said.

PeopleSoft's Henry declined to disclose how many hosting customers PeopleSoft has or how much revenue its hosting business generates. However, he said, hosting is the fastest-growing segment of PeopleSoft's business. The Pleasanton, Calif., company makes software designed to automate corporate accounting, human resources, manufacturing and customer service. It joins rivals Siebel Systems and Oracle in focusing on hosting services.

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