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Oracle eyes quick PeopleSoft resolution

Oracle's Charles Phillips says the company should know fairly soon, following its appeal of a U.S. Department of Justice antitrust ruling, whether it can pursue its PeopleSoft takeover attempt.

Oracle expects to know in August whether it will be able to pursue its hostile takeover attempt of rival business software company PeopleSoft, a decision that could lead to an acquisition by the end of the year, Oracle President Charles Phillips said Friday.

Speaking at a financial conference sponsored by his former employer, investment bank Morgan Stanley, Phillips said Oracle's appeal of a ruling from the U.S. Department of Justice antitrust division will begin June 7, with the trial expected to last six weeks. If the appeal goes in Oracle's favor, the company could realize its goal of buying PeopleSoft by the end of the year, Phillips said.

U.S. regulators in February found that a merger between Oracle and PeopleSoft would be anticompetitive and blocked the takeover attempt. The appeal to the Department of Justice's antitrust suit will be held in U.S. District Court in San Francisco.

Oracle's $9.4 billion takeover attempt has been rejected by PeopleSoft's board. If Oracle manages to overturn the Department of Justice's ruling on appeal, the company would still need to win over PeopleSoft's board or convince stockholders to tender their shares.

Phillips said reaching a resolution on PeopleSoft could clear up uncertainly around Oracle. "The good news is that this will be clearing up shortly, in a reasonable amount of time, and we can get that behind us," he said.

At the conference in New York, Phillips also addressed Oracle's strategy for finding areas of revenue growth. He reiterated the company's plan to make products, like its Oracle 10g "grid" database, that are designed to work with commodity hardware such as blade servers.

Buying several low-cost servers instead of more powerful machines costs less and lets companies add processing capacity on an as-needed basis. If companies spend less on hardware and operating systems, there may be more money left for the kinds of services Oracle sells, he said.

Phillips said Oracle's application server business--encompassing several products for business intelligence, portals and integration--represents a better growth opportunity than its flagship database business. Over the course of the fiscal year, Oracle will double the number of salespeople specializing in application server technology, which he said requires a different set of skills than selling database software.

In the integration software market, Phillips said Oracle is considering other products similar to its Customer Data Hub product, which it introduced earlier this year. A likely follow-on candidate would be integration software, which centralizes information about a company's products from several sources, he said. Such software would create a single instance in which all product information could be viewed by suppliers, partners, company engineers and others.

Phillips dodged a question about BEA Systems, which Oracle is said to have considered acquiring. BEA, the No. 2 provider of Java-based application servers, reported disappointing revenues on Thursday and lost market share last year. "I think it's safe to say that our acquisition strategy is more aggressive than it used to be, and we're open to new ideas," he said.

Responding to a question about the impact of open-source databases on its core database business, Phillips said that, if anything, open-source database company MySQL has helped boost sales for Oracle. People can learn basic database programming with MySQL and then move on to Oracle's products, which are priced competitively with MySQL's, he said.

Phillips also said the company has strengthened its relationships with consulting firms and systems integrators, such that Oracle expects to see less revenue coming from its own consulting organization.