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Oracle goes in for the Siebel kill

The software company plans to unveil a new program to steal some disgruntled Siebel software clients.

    The Oracle marketing machine is trying to wound Siebel Systems, and then go in for the kill.

    Oracle is unveiling tomorrow a new program to steal some disgruntled Siebel clients.

    The new program specifically targets Siebel's inherited Scopus customers. Siebel bought Scopus earlier this year and promised Scopus customers at the time a quick migration path to Siebel's products. Siebel makes sales force and marketing management software, while Scopus makes call center and field service management applications.

    Oracle is now preying on some of those Scopus customers who may be less than satisfied with Siebel's plan, or with the product that Siebel is offering them as an alternative to what they had with Scopus.

    "We will be allowing Scopus customers to upgrade to Oracle Front Office Version 3 at a 50 percent discount on the license," said Mark Barrenechea, Oracle's vice president of front office applications.

    "Why are we doing this? Siebel made promises to the marketplace six months ago that they would provide a program to migrate Scopus to Siebel. Now that it is the time to honor that, we are seeing that that is not happening. We thought we wanted to offer Scopus customers a product since they have no place to go without having to re-implement their systems and buy new licenses," Barrenechea said.

    But Oracle may be simply trying to usurp Siebel's plan for its Scopus customers. Siebel is to release on Monday Siebel 99, the latest version of its front office application package. It is the first version that fully integrates the sales force automation and marketing management software of Siebel, with Scopus' field service and call center functionality.

    Siebel 99 is the migration path for Scopus' approximately 250 customers. It was developed in seven months from scratch as Siebel scrapped all of its current products and rebuilt them with Scopus and Siebel technology, combined into one product.

    "This is an opportunity for Oracle to capitalize on converting some customers of Siebel," said Steve Bonadio, analyst at the Hurwitz Group in Framingham, Massachusetts.

    Peggy Menconi, analyst at Boston-based AMR Research agreed, saying that Siebel's and Oracle's squabble is more indicative of a hotly competitive market than two vendors in a tiff.

    "The market has gotten to the point where it is truly aggressive," Menconi said. "In the past, the market was growing so fast there was business everywhere. Now they are clearly taking shots at each other. This is a shot across the bow."

    While Oracle may grab some disgruntled Scopus users who have waited more than a year for an upgrade to their products, Bonadio said Oracle is most likely to lure its own customers over--that is, those Scopus customers running Oracle's enterprise back office applications.

    Part of Oracle's Scopus program is offering free integration of its front office application package with the enterprise resource planning package of financials, manufacturing, and human resource management applications.

    "For Oracle back office customers this is a compelling reason to switch," Bonadio said. "For the others, it is a choice they have now between Oracle's and Siebel's products."

    Oracle's front office applications sale lasts 60 days, which means anyone who is seriously evaluating front office products needs to act quickly.

    "These decisions are fairly extensive and when you look at the normal sales cycle, this window is very short," Menconi said. "If people who are really serious about it, then Oracle will probably have to give a little on that time frame. I don't think after 60 days it will be off the table. But if are just fiddling around getting comparisons, then Oracle likely won't extend this."

    Oracle would not disclose its pricing, making it hard to tell if the 50 percent price cut is a deal. Siebel 99's pricing starts at $1,350 per user.